A Mid-Year Correction. Whatever Happened to Decoupling? The UK Starts to Slow. A Recession by Any Other Name. What’s a Central Banker to Do?

Last week’s letter was the first part of a speech I have been giving on what I think will be the rise of a new asset class. This week will be the second and final part.

We vaporized 60 percent to the shadow banking system, the SIVs and CDOs, the people who actually bought US mortgages, who bought student loans, who bought credit cards, who bought car loans. That’s gone and it’s never coming back. As we’ll see, it’s going to take well into the next decade for us to create a completely new infrastructure to replace the broken one.

Earnings and Mr. Bear. Earnings Before Bad Stuff. How Ugly Can it Get? A Lean Mean Reversion Machine. Some Thoughts on Energy. Oregon, Maine and a Wedding.

Whip Inflation Now…Where Can We Get Help on Inflation?…The Patient Died Anyway…Inflation in Asia and Europe…There Are No Good Solutions

I remember in the summer of 2006 I would face my blank computer screen on a Friday and wonder, what I could write about? The media was all Goldilocks, all the time. Today, there is such a target-rich environment.

So, without further ado, let’s jump into the problem with the Euro. Back in May 2007, we wrote a piece entitled “Part 2-So What Should We Worry About“.

About five years ago, I said that the euro, which was trading at about $.88 at the time would rise to $1.50 and then fall back to $1 over the course of a decade or more. It would be one huge round trip.

The Commodity Futures Trading Commission announced yesterday that they are looking very hard at possibly closing a regulatory loophole that allowed some extremely large commodity index funds to get around position limits.