naked capitalism

Anonymous says:

Long interview with Mark Carney, Governor of Canadian Central Bank on BBC Radio today:

http://www.bbc.co.uk/worldservice/meta/tx/nb/interview_au_nb.ram

Everything is fixed?

ndk says:

Forty percent of respondents, meanwhile, incorrectly believed that the US president has the power to declare war, while 54 percent correctly answered that that power rests with Congress.

While the rest of the fail is a little scary, I can understand their confusion on that one.

Anonymous says:

From Wallison

This New Deal notion should be discarded.

Exhibit A is the banking system, now mired in the worst financial crisis since the Great Depression — even though it has always been the most heavily regulated. Exhibit B is the S&L debacle less than 20 years ago. Thousands of S&Ls and more than 1,500 commercial banks collapsed in another memorable regulatory failure.

No offense but this is complete tripe. AEI propaganda continues.

There was a reason there were no bubbles from the mid-30s to the late 80s, New Deal regulation. It was when AEI boys got in and started doing things like "de-regulating" S&Ls and the banks, that got us to where we are.

To claim what Wallison does above is simply Orwellian.

There was plenty of problems with the New Deal, financial regulation wasn't one of them. Just shows we got a long way to go.

Anonymous says:

The rat is a banker, the amphibian the American taxpayer.

Yves Smith says:

Saying Walliston’s piece was important did NOT mean I agreed. It is an articulate statement of an orthodoxy (that I happen to disagree with in large measure, but we do need to find a way to rationalize the financial sector) that is just not going away. It needs to be take apart piece by piece to expose the flaws.

Anonymous says:

Re: Walliston’s piece. One thing that the present financial panic has exponsed is that “too big to fail” doesn’t necessarily mean too big for the stock to go to zero. In fact this might be one of the reasons for the collapse of C shares. This points though to another issue. Some of these institutions regarded as too big to fail also appear to be too big to know. I haven’t heard anything about how this might be dealt with except by an army of federal auditors. That would have to include auditing the rating agencies I guess.

But how about this as a regulatory principle — too big to fail means too big period. In other words why not extend anti-trust legislation so that one of the criteria for approving merges would be that the combined institution would not be too big to fail. (This is the opposite of what is happening now.) Equally and in view of the evident trend to build larger and larger financial institutions, the goal of regulators should be to break up all those mega institutions that are now too big to fail. Finally, we might put pressure on non-American governments to enforce a similar rule by ruling that any financial institution dealing with non-American institutions deemed to pose a systemic risk would be ineligible for FDIC insurance or to receive loans from any institution part of the Federal Reserve system.

It may already be the case that being “too big to fail” can make an institution subject to anti-trust legislation since it clearly anti-competitive in the market place (also known as moral hazard). Unfortunately, the incoming administration has too many stalwarts of the ancien regime for anyone too have any hope. This may be the first case of an administration failing before it even takes office. Sorry but there will not be change. I guess that’s good for New York/DC (in the most myopic perspective). It’s pathetic.

Uncle Billy StuporSleuth says:

“The rat is a banker, the amphibian the American taxpayer”

{Evylle snicker}

Frog eats rat after giving him the free ride. Always does; it’s his nature.

Didn’t I post a nice link to a paper last week that went into gory detail about bk for fun and profit?

doc holiday says:

UB,

Perhaps if we triangulate here we can also see that the tax payer frog is the support base which is connected to liquidity, thus the banker rat is trapped on the back of the frog because it needs support, or otherwise will die in a sea of debt. This journey can only go so far, because the water is evaporating and one way or another thy both die …. moohhahahahahaha

However, what happens if the fly to stage left flies by the frog and that in-stability lapse, knocks the rat off and the little fella has no way back to shore, or any way to re-mount the asset-backed vehicle/entity/structure/TARP???

Whaddyah think of that, huh, huh?

Uncle Billy, StuporSleuth says:

doc: I love your tough guy posts!

And think you have a chokehold on the fragility of our little lovely triangle.

I hope you’re still tracking the covered bond world developments.

Gotta go… just ate some korean sushi and got a bad headache.

Anonymous says:

Sorry, only place to put this. Its from a friend in San Fran, who is a tax consultant and works for his fathers firm. It just leaves you breathless.

If Citibank goes under, I will laugh my ass off forever.

We just bought our house in September. The previous owner had two loans on the house and by the time we finished agreeing on the price, they were like 200K in the negative, so both of the note holders had to approve of the sale, because they were getting shorted. Their first loan was held by Citifinancial bank and the second loan was held by Citiresidential bank. The day AFTER we signed our FINAL documents, Citibank came up with a bogus charge of $6000 that they said was billed to them by an insurance company for the liability insurance during a time that the house was vacant for 9 months. They said they would void the entire contract and foreclose the house if we didn’t pay for this. The insurance company that the bill came from was of course Citibank Insurance. My Realtor ended up eating this and is trying to sue them right now to get it back. The lamest part of the entire fuckover was after they dropped this on us, they stopped answering the phone and faxes, or like 200 e-mails that they all sent them and went and hid under a rock. Citibank and all their companies are a complete bunch of douche bags.

I’ll bet you anything that if they do go under, soon afterwords, we’ll hear a story about how their top execs earned 20 million apiece for their wonderful work.

Skippy

doc holiday says:

Re: "When will it be time to grab the King and his friends"

> That will be up to Hillary now that she has bailed on The Senate, and thus, now she can live out her fantasy to be The Mouthpiece to play The Piper Song:

See and hear: And it's whispered that soon
If we all call the tune
Then the piper will lead us to reason

Your head is humming and it won't go
In case you don't know
The piper's calling you to join him
Dear lady can you hear the wind blow

>> That last line is a reference for Bill, but I may be wrong, but that's over my head and I'm just having a glass of ale…