Here's my Top 10 links from around the Internet at 10am. I welcome your thoughts and suggestions in the comments below. 
Is this the end of the bear market rally? Bloomberg reports the S&P 500 was down more than 2% in late trade as the profit takers emerged after the 37% rebound in the market in the last 2 months, the best since the 1930s... Vernon Small at the Dominion Post has a bit of a scoop with a background briefing paper obtained from Treasury showing a credit rating downgrade could cost New Zealand NZ$600 million a year in higher interest costs.
In a background paper obtained by The Dominion Post, Treasury officials, using Ireland as a benchmark, draw a specific link between the country's credit rating which agencies say is threatened unless debt is brought under control and social spending. The paper cautions that, although extra borrowing is economically attractive in the short term, the cost of continued use of debt would rise exponentially.
The OECD's most recent report on the global economy overnight hints at the early signs of recovery in some countries, including the UK, France, China and Italy, but warns many still have worse to come. Here's the FT.com version of this. Here's another more positive view from the Dean of the New York University Stern School of Business, Thomas Cooley, who spoke to CNN.
"There are distinct signs of a recovery in the U.S. economy, parts of Europe and elsewhere. There is a definite sense that the worst is over," he said. "But there are still many risks in the system, and we need to be cautious in what we evaluate because a lot of the problems aren't being addressed.
Ambrose Evans-Pritchard at The Telegraph delivers a dose of reality tinged with history to those who think the worst is over. He says Eurozone banks have yet to face up to reality and they could be the source of the next slump, just as they were in the bear market rally of the spring of 1931.
Bear market rallies can be explosive. Japan had four violent spikes during its Lost Decade (33pc, 55pc, 44pc, and 79pc). Wall Street had seven during the Great Depression, lasting 40 days on average. The spring of 1931 was a corker. There is at least one more boil to lance before we put this debt debacle behind us. The IMF says eurozone banks have so far written down a fifth of likely losses (US$750bn) compared to half for US banks. They must raise $375bn in fresh capital. Good luck. Germany's BaFin regulator goes further, warning of US$1.1 trillion of toxic assets on German bank books. Landesbanken are a calamity. If the IMF and BaFin are right, Europe has not yet had its crisis. When it does, we will see a second stress pulse through Eastern Europe and Club Med. The echoes of 1931 are ominous. That year began with green shoots, until Austria's Credit-Anstalt buckled in the summer and took Central Europe with it. Continentals who still thought it was an American crisis learned otherwise. Plus ça change.
William Pesek at Bloomberg examines the sharp rally on Asian markets and labels it Irrational Exuberance 3.0. Here's the definitive chart from dshort.com showing the great bear markets of the last 80 years. 
Cactus Cate (aka Cathy Odgers) launches a sustained and detailed attack on the NZX's activities. It is well worth a read. This is an amazing mea culpa from a former insider at Deutsche Bank, Deepak Moorjani, on the culture of high pressure selling and non-existent risk management that led to the credit boom (and bust). Tyler Durden at Zerohedge has the scoop letter. Here's a taste. HT Lance Wiggs.
When speaking about the banking sector, many people mention a "subprime crisis" or a "financial crisis" as if recent write-downs and losses are caused by external events. Where some see coincidence, I see consequence. At Deutsche Bank, I consider our poor results to be a "management debacle," a natural outcome of unfettered risk-taking, poor incentive structures and the lack of a system of checks and balances. In my opinion, we took too much risk, failed to manage this risk and broke too many laws and regulations. For more than two years, I have been working internally to improve the inadequate governance structures and lax internal controls within Deutsche Bank. I joined the firm in 2006 in one of its foreign subsidiaries, and my due diligence revealed management failures as well as inconsistencies between our internal actions and our external statements. Beginning in late 2006, my conclusions were disseminated internally on a number of occasions, and while not always eloquently stated, my concerns were honest. Unfortunately, raising concerns internally is like trying to clap with one hand. The firm retaliated, and this raises the question: Is it possible to question management's performance without being marginalized, even when this marginalization might be a violation of law? Two years later, our mounting losses are gaining attention, and I offer my experiences and my thoughts in the hopes of contributing to the shareholder and public policy debate.
Australian Prime Minister Kevin Rudd's bid to ensure his housing market avoids the global property slump may push a generation of buyers into a debt crisis, Bloomberg opines. The real story at the moment is the rise in US Treasury bond yields despite the US Federal Reserve's money printing and bond buying. This is pushing up US mortgage rates and causing many investors to call for yet more bond buying (money printing), Bloomberg reports.
The slump in Treasuries the past seven weeks pushed yields on longer-maturity bonds up by more than half a percentage point and sent average rates on 30-year mortgages to the highest since the start of April, according to North Palm Beach, Florida-based Bankrate.com. Policy makers said March 18 they were committing "greater support to mortgage lending and housing markets" when they pledged to buy as much as $300 billion of Treasuries and stepped up purchases of bonds backed by home loans. BlackRock Inc., American Century Investments, Federated Investors and Pioneer Investment Management say it's time to buy Treasuries because the Fed will need to expand its purchases to keep consumer borrowing costs from rising further. While higher bond yields, the 37 percent increase in the Standard & Poor's 500 Index since March 9 and U.S. reports on housing and inventories show the economy may be stabilizing, Bernanke said May 5 that "mortgage credit is still relatively tight." "The Fed needs to consider increasing its purchases of Treasuries," said Stuart Spodek, co-head of U.S. bonds in New York at BlackRock, which manages $483 billion in debt. Spodek said he resumed buying Treasuries. "We are still in a recession. It's quite bad. They need to stabilize long-term rates."
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