Yearly Archives: 2011
Quelle Surprise! GAO Finds the Fed is a Club of Backscratching, Well Connected, White Bankers
The GAO released a report yesterday that provided some anodyne but nevertheless useful confirmation of many of the things most of us knew or strongly suspected about the Fed: it’s a club of largely white male corporate insiders who do a bit too many favors for each other. But the GAO seemed peculiarly to fail to understand some basic shortcomings of its investigation.
Read more...Eurozone Leaders Ready €80 Billion Band-Aid for Banking Industry Gunshot Wound
I must confess I don’t stay on top of the blow by blow of the ever-devolving Eurozone mess. The broad lines of the trajectory look all too predictable. The officialdom could patch up things for quite a while if the powers that be let the ECB monetize the debt (eventually, you could have an inflation problem, but with the EU and global economy so slack, “eventually” will take quite a while to show up).
However,everyone in positions of authority seems to believe in certain-to-fail-much-faster austerity instead. So the permissible short-to-medium term fixes involves lots of complicated programs, multi-party negotiations, and in some cases, political approvals. The timeline for the governmental maneuvering seems badly out of line with what Mr. Market requires. And to make matters worse, an earlier deal on a Greek funding, which involved bondholders taking a 21% haircut, is now deemed not to be punitive enough to banks. While that is narrowly true, having this deal come unglued could be the detonator that sets off a crisis chain reaction.
And from a wider vantage, none of these remedies address the real issue
Read more...Bank of America Setback: $8.5 Billion Mortgage Settlement Successfully Removed to Federal Court (Updated)
Bank of America can’t win for losing.
Read more...Links 10/19/11
David Graeber: On Playing By The Rules – The Strange Success Of #OccupyWallStreet
By David Graeber, who is currently a Reader in Social Anthropology at Goldsmiths University London. Prior to that he was an associate professor of anthropology at Yale University. He is the author of ‘Debt: The First 5,000 Years’ which is available from Amazon.
Just a few months ago, I wrote a piece for Adbusters that started with a conversation I’d had with an Egyptian activist friend named Dina:
All these years,” she said, “we’ve been organizing marches, rallies… And if only 45 people show up, you’re depressed, if you get 300, you’re happy. Then one day, 200,000 people show up. And you’re incredulous: on some level, even though you didn’t realize it, you’d given up thinking that you could actually win.
As the Occupy Wall Street movement spreads across America, and even the world, I am suddenly beginning to understand a little of how she felt.
Read more...Latest Attorney General Bailout Plan: Give Banks “Get Out of Jail Free” Card for a Few Refis
Attorney General Tom Miller of Iowa, who is leading the whitewash once known as the 50 state attorney mortgage settlement negotiations (7 have defected), reliably, every few weeks, has gotten word to the media that a deal is weeks away. This has been going on so long that it is easy to ignore it, particularly since the absence of key states is going to reduce the importance of any settlement being reached.
Note we’ve been skeptics of a deal happening unless the AGs capitulated on a release of liability. And that is the latest plan.
We have a combo plate of stories, one in the Wall Street Journal yesterday morning and a further critical tidbit from Reuters this evening that together give an overview of Miller’s latest effort to push a deal over the goal line. The latest idea is as bad as we feared.
Read more...Attorney General Beau Biden on Investigating the Mortgage Mess
The Dylan Ratigan show is on a roll this week. The program today included a segment with one of our heros, Delaware attorney general Beau Biden, who was early to join New York’s Eric Schneiderman in questioning the now less than 50 state attorney general mortgage settlement. He also joined the FDIC, Schneiderman and a large number of investors in objecting to a proposed $8.5 billion mortgage settlement by Bank of America.
Biden makes a clear and concise statement of the major issues:
Read more...Credit Revulsion in Belgium, France and Austria
Look at these charts that Win Thin has crafted on sovereign bond spreads. Yes, the periphery looks bad. But look at Belgium, Austria and France. That’s the euro zone core. As I predicted in August and reiterated most recently last week when I saw Belgium’s CDS indicating a one in four chance of default: we […]
Read more...Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository
If you have any doubt that Bank of America is going down, this development should settle it. I’m late to this important story broken this morning by Bob Ivry of Bloomberg, but both Bill Black (who I interviewed just now) and I see this as a desperate move by Bank of America’s management, a de facto admission that they know the bank is in serious trouble.
Read more...Links 10/18/11
The Data That the Economy is Not So Hot is Getting Harder to Ignore
The propagandistic exhortation that we all need to need to learn to love or at least accept the crappy economy known as “the new normal” is starting to wear a bit thin. One of the things that has allowed the punditocracy to pretend that “the new normal” really isn’t all that bad are various myths that they get investors and sometimes the broader public to believe in succession or better yet simultaneously:
Read more...Elizabeth Warren’s Jobs Plan: War with Iran
As much as your humble blogger still regards Elizabeth Warren as preferable to Scott Brown in the Massachusetts Senate race, the evidence from her campaign is that she is no progressive, unless you define “progressive” to mean “centrist/Hamilton Project Democrat willing to throw a few extra bones to the average Joe.”
We’ve warned repeatedly that Warren not being all that left leaning was a real possibility.
Read more...A Victory for #OccupyWallStreet in the Most Unlikely of Places?
Please welcome Carol Smith, who is based in Austin and has considerable experience in financial services industry research and analysis. I’m pretty confident she’s also listened to more analyst conference calls than most Naked Capitalism readers have, and you’ll see her put her experience to good use.
By Carol Smith
A Financial Times article today showcased recent comments by bank executives and politicians (and even Erick Erickson of RedState.com!) sympathizing with the sentiments behind the Occupy Wall Street movement.
Read more...Tom Ferguson: Congress is a “Coin Operated Stalemate Machine”
Readers may recall that we discussed a Financial Times op ed by University of Massachusetts professor of political sciences and favorite Naked Capitalism curmudgeon Tom Ferguson which described a particularly sordid aspect of American politics: an explicit pay to play system in Congress. Congresscritters who want to sit on influential committees, and even more important, exercise leadership roles, are required to kick in specified amounts of money into their party’s coffers. That in turn increases the influence of party leadership, since funds provided by the party machinery itself are significant in election campaigning. And make no doubt about it, they are used as a potent means of rewarding good soldiers and punishing rabble-rousers
A new article by Ferguson in the Washington Spectator sheds more light on this corrupt and defective system.
Read more...