The Eurocrats finally seem to have realized time is running out. The abrupt market downdraft of last week appears to have focused their minds on the need for a much larger scale rescue mechanism of some form, with numbers like trillions attached, and that will move the Eurozone further towards fiscal integration, another badly needed outcome.
Read more...We’ve mentioned in older posts that Dimon’s history as a bully goes back at least to business school. Former section mates report that even by Harvard Business School standards, Dimon was a standout in the aggression category.
Readers may also recall that Dimon’s latest effort to get out of having international capital standards imposed on JP Morgan was to call them “anti-American”. It appears that, for a big bank, “American” = “not having to obey any rules”.
Read more...Yves here. Before reacting reflexively to the thesis of the article, consider this corroborating view from the former chairman of Goldman, John Whitehead, back in 2007:
“I’m appalled at the salaries,” the retired co-chairman of the securities industry’s most profitable firm said in an interview this week. At Goldman, which paid Chairman and Chief Executive Officer Lloyd Blankfein $54 million last year, compensation levels are “shocking,” Whitehead said. “They’re the leaders in this outrageous increase.”
Whitehead went even further, recommending the unthinkable, that Goldman cut pay:
Whitehead, who left the firm in 1984 and now chairs its charitable foundation, said Goldman should be courageous enough to curb bonuses, even if the effort to return a sense of restraint to Wall Street costs it some valued employees. No securities firm can match the pay available in a good year at the top hedge funds.
“I would take the chance of losing a lot of them and let them see what happens when the hedge fund bubble, as I see it, ends,” Whitehead, 85, said….
By Bruno S. Frey, Professor of Economics at the University of Zurich and Margit Osterloh, Professor (em.) for Business Administration and Management of Technology and Innovation, University of Zürich; and Professor, Warwick Business School. Cross posted from VoxEU
Read more...I’m beginning to wonder whether the right to assemble is effectively dead in the US. No one who is a wage slave (which is the overwhelming majority of the population) can afford to have an arrest record, even a misdemeanor, in this age of short job tenures and rising use of background checks.
Read more...Hoisted from comments, this from reader barrisj. When I went to read the London Banker post in question, I too was struck by the passage barrisj singled out:
Read more...Well, we are clearly in crisis mode. We are back to weekends being a period when you need to watch the news in a serious way.
And in another bit of deja vu all over again, the powers that be in Europe are readying yet another bailout plan, this one supposedly big enough to do the trick once and for all.
Read more...By Sell on News, a macro equities analyst. Cross posted from MacroBusiness
The Euro crisis appears to be developing into something similar to the 1980s Latin American debt crisis when the idea that, to quote Walter Wriston, who ran First National City/ Citibank from the 1960s into the 1980s it was assumed that: “countries don’t go out of business.” The Latin American leadership demonstrated that they, in effect, could, by defaulting. As a number of bloggers at MacroBusiness have pointed out, government finances are not like household finances, although they are often seen that way. That much is well understood in the financial community, although perhaps not as well in the wider public.
Read more...Big banks are very powerful, and they destroy politicians they don’t like. Obviously, they don’t do it directly, but operate through front groups. Some of these organizations are known as “media outlets”, such as the New York Post, which outed one of Eric Schneiderman’s lawyers as a dominatrix to embarrass and intimidate his office.
Read more...Bloomberg interviewed Harvey Miller, who is regularly described as the dean of the bankruptcy bar in the US. Miller handled the Lehman bankruptcy and is thus well positioned to opine on whether Bank of America might put Countrywide into bankruptcy.
Read more...By Matt Stoller, the former Senior Policy Advisor to Rep. Alan Grayson and a fellow at the Roosevelt Institute. You can reach him at stoller (at) gmail.com or follow him on Twitter at @matthewstoller
The fight over the future, in the form of the fight over who writes the history of the Obama years, has begun in earnest.
Read more...Jeff Madrick is a journalist, economic policy consultant and analyst. He is also the editor of Challenge magazine, which seeks to give alternative views on economics issues, as well as a visiting professor of humanities at The Cooper Union, director of policy research at the Schwartz Center for Economic Policy Analysis, The New School, a senior fellow at the Roosevelt Institute and the author of numerous books. His latest book, The Age of Greed, is available from Amazon.
Interview conducted by Philip Pilkington, a journalist and writer based in Dublin, Ireland.
Philip Pilkington: Your book The Age of Greed is a detailed historical survey of some of the key figures that facilitated — broadly speaking — the transition away from the progressive, government-regulated economy of the post-war years and toward the finance-driven, deregulated economy in which we now live. In this interview I don’t want to focus on all the figures that crop up in the book as that is done so there in great detail. Instead I want to explore the broad sweep of this history focusing both on some of the more recognisable of these figures and on the actual cultural, political and economic shift that took place over this period.
Read more...By Delusional Economics, who is unhappy with the current dumbed-down vested interest economic reporting the Australian public is force fed on a daily basis, and takes pleasure in re-reporting the news with “bad” parts removed, and a bit of contrarian balance thrown in. Cross posted from MacroBusiness
The big news from Europe last night was the “surprising” PMI numbers. But as usual the news also goes behind the headline.
Read more...By Marshall Auerback, a portfolio strategist and hedge fund manager
I’ve been in Amsterdam and met some people very well connected with the ECB. The topic de jour is the apparent split between the Germans and the ECB, especially in light of the resignation of Jürgen Stark last week from the ECB executive board. This has been a move hailed as a German protest of the errant ways of the ECB, andStark is now touting his conservative ideas around Europe in a hope to undermine the central bank’s current interventions. That’s the public line.
But the people to whom I’ve spoken here contend that Stark’s resignation does reflect the reality that the Germans are losing out as far as the ECB goes. The profound objections to what the ECB is becoming on the part of Germany is also accompanied by a realisation that it is the only supranational game in town and has little choice but to take on this quasi-fiscal function that it is now undertaking.
Read more...I don’t mean to sound as if I am hectoring Shahien Nasiripour, since he has doggedly and successfully broken quite a few banking stories when he was at Huffington Post, which lead the Financial Times to snatch him up. That’s tremendous validation for a young reporter.
However, the conventions of reporting (and it may reflect FT style preferences) are having two unfortunate side effects on his latest article about the so-called 50 state attorney general settlement.
Read more...Mr. Market so far is not at all impressed with the announcement today that the Fed will be changing the composition of its portfolio by selling $400 billion of near-dated Treasuries and buying the same amount of longer maturity Treasuries. Since the Fed will maintain the same Fed funds target rate, the Fed’s intent is to keep short term rates low and also reduce longer term rates.
The fallacy with the Fed approach, as our Marshall Auerback has pointed out repeatedly, is that targeting a quantity means the central bank has no idea what result it will achieve.
Read more...