Quote of the day

Scott Patterson, “What would happen if such a “glitch” ate a hole in the balance sheet of a TBTF bank? Know we’re talking something else. Systemic risk–and tax payer bailouts. Again.”  (Scott Patterson)

Chart of the day

AOL ($AOL) is recycling its patent portfolio profits into its own shares…at the highs.  (TechCrunch)

Markets

Don’t look now but positive economic surprises are on the rise.  (Money Game)

A really positive step for the US economy.  (The Reformed Broker)

We’re one year from the S&P downgrade of the US.  (IndexUniverse)

High yield is hot, but what about distressed debt?  (Distressed Debt Investing)

What some investors are doing in advanced of potential tax law changes.  (NYTimes)

Companies

A bet on Berkshire Hathaway ($BRKA) is a bet on housing.  (Bloomberg)

Decline aside, the market still values Facebook ($FB) as a very successful company.  (Economist also Businessweek)

Miners are putting big projects on hold.  (WSJ)

Finance

Incentives matter: for badminton and finance.  (FT Alphaville)

When dealing with Goldman Sachs ($GS) you should always choose the plain-vanilla deal.  (Dealbreaker)

When financial bonds default it is usually really bad news for holders.  (Learn Bonds)

It’s time to abolish the maker-taker model.  (Themis Trading)

Why you should read Doug Henwood’s book Wall Street.  (Justin Fox)

Global

The big Draghi re-think.  (FT Alphaville also Free exchange)

It looks like the Canadian real estate market is finally cooling off.  (Globe and Mail)

Japan is cracking down on insider trading.  (Dealbook)

On the strength in the Israeli economy.  (The Atlantic)

Chinese elites love expensive Swiss watches: here comes the retrenchment.  (Bronte Capital)

Economy

A mixed non-farm payrolls report for July unleashes a wave of analysis.  (Calculated Risk, Real Time Economics, Wonkblog, Planet Money, Money Game, Term Sheet, Tim Duy)

For something that gets revised so much we sure pay a lot of attention to non-farm payrolls.  (Felix Salmon)

Rail traffic continues to show resiliency.  (Pragmatic Capitalism)

Why teachers are still getting laid off.  (The Atlantic)

For the economy’s sake why should welcome creative destruction.  (Cale in the Keys via TRB)

Earlier on Abnormal Returns

What you missed in our Friday morning linkfest.  (Abnormal Returns)

Mixed media

What if the freestyle were really free?  (WSJ)

Finally a reason to love mustaches.  (Wonkblog)

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