Links 5/20/09

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Man saves ducklings from ledge BBC

Twitter is our id, Facebook is our Ego Roger Ehrenberg. Further confirmation of why I want neither on display.

Hamptons Homes Drop Most Since Realtors Kept Records Bloomberg

Effect of Household Deleveraging on Housing, Consumption and the Stock Market Michael Shedlock (hat tip reader Steve L)

U.S. Considers Stripping SEC of Power in Rules Revamp Bloomberg (hat tip reader Michael D). They want to shift its duties to….the Fed. The SEC has become more and more ineffectual over the years, but could be revitalized. The Fed is full of monetary economists who don’t understand (and don’t have much interest in) derivatives, among other things. They don’t have have the skills or mindset to do criminal investigations.

Where Are the Damn Cops (BAC) Karl Denninger (hat tip reader Richard R)

Beijing’s stimulus measures questioned Financial Times (hat tip reader Michael Q)

Activist Financier ‘Terrorizes’ Bankers in Foreclosure Fight Wall Street Journal

Let battle commence Gilian Tett and Aline van Duyn, Financial Times. On derivatives regulation. If you have not read it, you MUST also see Kabuki on the Potomac: Reforming Credit Default Swaps and OTC Derivatives Institutional Risk Analytics.

Antidote du jour (hat tip reader Stephen):

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  1. Richard Smith

    Our ducklings did the dive in April – just as you see in the video, except the drop is 80ft, and there’s no road at the bottom, just a handy lake.

  2. Carrick

    Fed do the SEC’s work?…. wtf.

    I’m a total novice, but at the very least, isn’t this an awful idea b/c the Fed has a conflict of interest? They may not exactly be involved for gain, but they are affecting the market. Should they really be investigating and taking out unique players too? “Hmmn, don’t like how this action is playing out? Who’s in the way? Well, ease off/open up that investigation we’ve had in the wings..”

    On Elizabeth Warren on RealTime:
    Kudos to her for going above over her boss’ head and going to the ‘street’ to put her voice out there. She should be in a more Admin-supported public role. Obama underestimated how much PR work his Treasury pick would need to do, which is odd considering that their outlook has been that the markets just need a ‘cool hander’ to get the everyone playing again. If she were the face of the Treasury, the general public might have more faith in this whole endeavor. As it is, its barely skating by on Obama’s cred. Now he’s the face of this thing, and his “brain” just comes across as having been cut from the same class of incompetent bullshit artists that made it happen.

    It is really relieving to see a HUMAN woman in the media representing government. Pelosi, Bachmann… the goolgie-eyed egos on steroids… the latter doesn’t have kids, and all the better. She seems like the type that eats their young.

  3. skippy

    RE: The Financial Times/Institutional Risk Analytics articles.

    For 40 odd years the Turkeys of Finance and their False Positives, have come home to roost and were all sitting under the tree enjoying the trickle down/droppings of their cerebral assisted fraud upon us all.

    skippy…I wish the planet was a big etch-a-sketch for I would give it a huge shake, the present drawing is crap and the authors are beaming with pride even still.

  4. Glen

    BoA raised $13 billion a day after GS recommended an upgrade. Sorry, just to cynical to believe that this was random event. Be interesting to see the rush for capital raisings over the next week before the squeeze ends but at least their sucking cash out of other suckers and not the tax payer.

  5. joebek

    The Feds should take this opportunity to enter the housing market in the Hamptons to begin converting Long Island into a wilderness area. It will take several decades but it is clearly the way to go.

  6. Crystal Clear

    Just wanted to add Yves that although I’ve only been a faithful daily reader for about 9 months, I really appreciate your take on things and have come to truly adore the comments as well. You definitely have the BEST comments on your blog and it is your voice I think which inspires it all! Keep it up gang- not only is your prose not wasted… it is thoroughly valued and lends me hope there is still intelligent thought out there.

  7. Peripheral Visionary

    Yves: “The Fed is full of monetary economists who don’t understand (and don’t have much interest in) derivatives, among other things. They don’t have have the skills or mindset to do criminal investigations.”

    I’ve been seeing this coming from my little corner of the financial regulatory world. As you noted, the Fed does not have the “skills or mindset” (or the staffing) to do financial regulation, particulary criminal investigations, but that is beside the point. The call to move regulation to the Fed is because the Fed is more “trusted”, which is to say, they have been more willing to do the executive branch’s will rather than act independently. Even with all its other problems, the SEC remains bipartisan and has not been fully captured by the executive branch the way the Fed has.

    This has nothing to do with competency (note that even the proponents of this move are not saying that the Fed would be any better at it), but rather political expediency. To put it bluntly, the “all regulators under one structure” move is being used as a trojan horse to strip the regulatory structure of what little independence it has left.

  8. Peripheral Visionary

    As somebody on Krugman’s blog pointed out, he has gone strangely quiet on domestic economic issues, confining his comments to mostly politics with a little international economics. Wonder if there is any connection between the shift in topics and his recent trip to the White House . . .

  9. Marlowe


    A special request, please. WSJ says BAC sold 800 shares at $10 in a single block on Tuesday, but was extremely coy about the source of this item and no hint about who bought that $8 billion stake — without which BAC’s at-the-market secondary would have materially failed after GS buy recommendation. Denninger is mad because there was selective news and obvious insider dealing just before the close yesterday. I don’t care about that. What I want to know is *who* bought the 800 million share block after hours? Was it Goldman? NYFed? Treasury? Buffett? China Development?

  10. Marlowe

    Sorry. 800 million shares in a single block. It’s astounding that no one has picked up on this, and it ought to be public information.

  11. john bougearel


    I am just reading the govt intent to strip the SEC of its powers. Their rational for doing so is what is scary. The aim is to give the Fed more authority to supervise the “too big to fails.” In short, the “O” admin is buying the TBTF myth hook line and sinker. According to BN:

    The proposal, still being drafted, is likely to give the Federal Reserve more authority to supervise financial firms deemed too big to fail.

    My budding hopes that O might use the automaker bankruptcies as a precedent to shrink the TBTF’s is shot to hell. My takeaway: Oh shit, the financial system will be the same as it ever was before teh crisis started. The only diff: a few less TBTF’s on the field, which only strengthens the TBTF’s still on the field only at the behest of the taxpayer dime being fraudulently extorted by the admin and Treasury.

    America is becoming a debtor’s prison. The TBTF’s have become religious institutions/sacred cows supported only by the forced tithing of taxpayers.

    Oh, and as for CDS products taking us up shit creek: according to a recent IRA article, the banks own the new clearing corp, and the ICE exchange on which these WMD products will be traded on, and the exchange/clearing corp will not be regulated by the Fed. Again, it is all about reconstituting the flawed financial system of yesteryear exactly as it was. This is not just illegal, it is sinful

    Oh and my word verification is “sindfuy”

  12. Todd Wood

    Not going to read Karl Denninger. If it were not for this attack from above, he would be attacking us who are below him.

    He is a real Neil Blortz living in his Happy Valley. To hell with the rest of us.

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  14. Doc Holiday

    a full recovery could take as long as six years, according to a forecast issued today by the Federal Reserve.

    The projections were grimmer than those issued by the Fed in January.

    >Six years is about right, and it also is the length of time need to depreciate losses….

  15. "DoctoRx"


    Re “Twitter id/Facebook ego” link to Roger Ehrenberg, note that the location of NC’s “Bookmarks” interferes w hitting the COMMENTS button.

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