Weekend Reading

Good Sunday morning, and welcome to Weekend Reading. As always, here are some articles and papers worth reading. First, however, a look back at the week that just finished, and a look forward to the week ahead.

The major U.S. indices had their best week in four years. The S&P 500 gained 3.5%, and the Dow climbed 3.1%. The tech-heavy Nasdaq rose more or less equivalently, up 3.2% for the week. Most people "blamed" positive comments on future Fed rate cuts in this past week's FOMC statement. That's fair enough, but you might just as well as have blamed sunspots. After all, investors have been selling and have been nervous for the better part of a month, so it doesn't take much to turn things around in a fear rally, which is exactly what we had this past week.

Looking forward to next week, bulls will try to keep things going, but it may be a little tougher. Last week's positive Fed statement, as well as a lessening of concern about subprime mortgages, helped do the trick, but that particular fuel won't be available next week. Instead, we have new concerns about the subprime spiral, including the impact it could have on higher quality borrowers. ...