Here are my top 10 links from around the Internet at 10 am. I welcome your additions and comments below or please send me your suggestions for Wednesday's Top 10 at 10 to bernard.hickey@interest.co.nz We pride ourselves on being more than furniture with coffee breath... 
1. Really? - It seems one of the biggest buyers of US Treasuries in recent months have been Britain and Hong Kong, or at least buyers domiciled in Britain and Hong Kong for reporting purposes. Here's the detail from Seeking Alpha. There is plenty of talk at least that the US Federal Reserve is buying the Treasuries via Britain in a sort of merry go round printing exercise. HT Gertraud 2. Tent cities - For those who wonder what's really happening in America, here is a video showing the growth of tent cities on the edges of Sacramento as thousands of people lose their jobs and become homeless, NBC reports in this video.
3. Carlos not so Slim - Simon Johnson at Baseline Scenario is always worth a read and here he looks at who might be the winners from this global financial crisis. HT Harry Hansman via email
With every sharp turn of the cycle, new people rise to the front "“ taking advantage of low asset prices and the fact that most people struggle to borrow on reasonable terms. In Mexico, after the crisis of 1994-95, Carlos Slim consolidated his position in telecoms and used this as a launching pad to become one of the world's richest people.
Three sets of players look positioned to do the same in the US today, mostly based on the amazing set of "carry trades" available if you have access to large amounts of cheap short-term funding (e.g., along the yield curve, from dollars into other currencies, and "“ arguably "“ into equity in some parts of the world).
4. Crash baby crash - Ambrose Evans Pritchard is also well worth reading, particularly when he's banging on about the British pound's independent ability to crash when needed. He goes through history and finds some big crashes have done great things for Britain. He is a fan of money printing.
Britain has twice averted disaster over the past century by a timely "“ if humiliating "“ crash in sterling. In neither case was it obvious that this would lead to a decade-long revival in British fortunes.
Sterling's slide may overshoot so badly this time that it triggers a run on the gilts market. But there are risks whatever we do. My (unpopular) view is that the Bank of England has saved this country from depression by printing money a l'outrance, and inviting markets to sell sterling.
A crashing currency is not a pretty sight. Yet the iron rule is that once you have debauched your economy, you must let the exchange rate reflect reality. To pretend otherwise is to dig your nation deeper into a hole.
5. Emperor has no clothes - Obama supporter Paul Krugman talks in his New York Times column about how US banks are still broken, despite all the recovery talk. He also notes a change in tone from his mates around Obama.
Administration officials are furious at the way the financial industry, just months after receiving a gigantic taxpayer bailout, is lobbying fiercely against serious reform. But you have to wonder what they expected to happen. They followed a softly, softly policy, providing aid with few strings, back when all of Wall Street was on the ropes; this left them with very little leverage over firms like Goldman that are now, once again, making a lot of money. But there's an even bigger problem: while the wheeler-dealer side of the financial industry, a k a trading operations, is highly profitable again, the part of banking that really matters "” lending, which fuels investment and job creation "” is not. Key banks remain financially weak, and their weakness is hurting the economy as a whole. You may recall that earlier this year there was a big debate about how to get the banks lending again. Some analysts, myself included, argued that at least some major banks needed a large injection of capital from taxpayers, and that the only way to do this was to temporarily nationalize the most troubled banks. The debate faded out, however, after Citigroup and Bank of America, the banking system's weakest links, announced surprise profits. All was well, we were told, now that the banks were profitable again. But a funny thing happened on the way back to a sound banking system: last week both Citi and BofA announced losses in the third quarter. What happened? Part of the answer is that those earlier profits were in part a figment of the accountants' imaginations. More broadly, however, we're looking at payback from the real economy. In the first phase of the crisis, Main Street was punished for Wall Street's misdeeds; now broad economic distress, especially persistent high unemployment, is leading to big losses on mortgage loans and credit cards. And here's the thing: The continuing weakness of many banks is helping to perpetuate that economic distress. Banks remain reluctant to lend, and tight credit, especially for small businesses, stands in the way of the strong recovery we need.
6. Countdown - Wolfgang Munchau at the FT.com sees a clear way through the uncertainty and the end is not good. He makes some interesting points about the fundamental instability of very large financial institutions, courtesy of Hyman Minsky's 'instability hypothesis'.
Our present situation can give rise to two scenarios "“ or some combination of the two. The first is that central banks start exiting at some point in 2010, triggering another fall in the prices of risky assets. In the UK, for example, any return to a normal monetary policy will almost inevitably imply another fall in the housing market, which is currently propped up by ultra-cheap mortgages. Alternatively, central banks might prioritise financial stability over price stability and keep the monetary floodgates open for as long as possible. This, I believe, would cause the mother of all financial market crises "“ a bond market crash "“ to be followed by depression and deflation. In other words, there is danger no matter how the central banks react. Successful monetary policy could be like walking along a perilous ridge, on either side of which lies a precipice of instability. For all we know, there may not be a safe way down.
7. Bricbats - Nouriel Roubini talks at the Globe and Mail about the vulnerability of Russia, which is just about to sell US$20 billion worth of bonds.
Conventional wisdom rarely survives a good stress test, and few tests have been as stressful as what the global economy has endured over the past 24 months. A healthy season of reappraisal has dawned, shining a new light on boom-time notions such as the value of opaque markets, the untouchable status of the American consumer and the wisdom of deregulation.
One piece of bubble wisdom that has escaped relatively unscathed, however, is the assumption that the BRIC countries "“ Brazil, Russia, India and China "“ will increasingly call the economic tune in years to come. The BRIC notion, coined in a 2003 Goldman Sachs report, is not all bad: At 75-per-cent correct, it scores a good deal better than most economic prognostications of the day.
Yet, the economic crisis that began in 2008 exposed one of the four as an imposter. Set the vital statistics of the BRIC economies side by side and it becomes painfully obvious that, in the words of the old Sesame Street game, "One of these things is not like the other."
The weakness of the Russian economy and its highly leveraged banks and corporations, in particular, which was masked in recent years by the windfall brought by spiking oil and gas prices, burst into full view as the global economy tumbled. Saddled with a rustbelt infrastructure, Russia further disqualifies itself with dysfunctional and revanchist politics and a demographic trend in near-terminal decline.
8. He said what? - Alan Greenspan now believes that banks should not be too big to fail. As Neil Finn might have sung about US monetary policy: "The finger of blame has turned upon itself..." Or maybe the old codger who got it horribly wrong has yet to realise how he got it wrong... Read his comments reported by Bloomberg and try not to throw your computer out the window
U.S. regulators should consider breaking up large financial institutions considered "too big to fail," former Federal Reserve Chairman Alan Greenspan said. Those banks have an implicit subsidy allowing them to borrow at lower cost because lenders believe the government will always step in to guarantee their obligations. That squeezes out competition and creates a danger to the financial system, Greenspan told the Council on Foreign Relations in New York. "If they're too big to fail, they're too big," Greenspan said today. "In 1911 we broke up Standard Oil -- so what happened? The individual parts became more valuable than the whole. Maybe that's what we need to do." At one point, no bank was considered too big to fail, Greenspan said. That changed after the Treasury Department under then-Secretary Hank Paulson effectively nationalized Fannie Mae and Freddie Mac, and the Treasury and Fed bailed out Bear Stearns Cos. and American International Group Inc. "It's going to be very difficult to repair their credibility on that because when push came to shove, they didn't stand up," Greenspan said.
9. Sell out - This is a great piece from Kevin G Hall at McClatchy Newspapers about how Moody's sold its ratings and sold out investors. And remember, New Zealand is going to be relying on Moody's for some of its credit ratings for non bank deposit takers.
As the housing market collapsed in late 2007, Moody's Investors Service, whose investment ratings were widely trusted, responded by purging analysts and executives who warned of trouble and promoting those who helped Wall Street plunge the country into its worst financial crisis since the Great Depression. A McClatchy investigation has found that Moody's punished executives who questioned why the company was risking its reputation by putting its profits ahead of providing trustworthy ratings for investment offerings. Instead, Moody's promoted executives who headed its "structured finance" division, which assisted Wall Street in packaging loans into securities for sale to investors. It also stacked its compliance department with the people who awarded the highest ratings to pools of mortgages that soon were downgraded to junk. Such products have another name now: "toxic assets."
10. Windfall tax? - Gordon Brown is scrambling around for cash to fill his yawning budget chasm. It seems the banks are his new target. There's fresh talk of a windfall tax for those banks making big trading profits, TimesOnline. reported. What's really needed is a Tobin tax on financial transactions.
Banks are being threatened with a windfall tax on profits amid mounting criticism from across the political spectrum of a return to huge bonuses. Strong financial results from American investment banks have raised the prospect of a bumper bonus season in Britain, even at the state-controlled RBS. Evidence that banks were returning to "business as usual" a year after the financial system was bailed out sparked anger yesterday from all the main parties and from President Obama's Administration. A senior Labour source said that a windfall tax was "plan B" if the banks failed to take action themselves on excessive remuneration.
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