Category Archives: Banking industry

Interview with Andrew Patterson in New Zealand

It’s striking how the media overseas is much more receptive to the message of ECONNED than our home grown outlets are. Hope you enjoy this interview from New Zealand! Go here to listen.

Satyajit Das: Grecian Derivative

By Satyajit Das, a risk consultant and author of Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives – Revised Edition (2010, FT-Prentice Hall). In his “Ode on a Grecian Urn”, the English Romantic poet John Keats declared that “beauty is truth, truth beauty”. In derivatives, its seems transactions may be […]

Summer Rerun: Do-It-Yourself Dubious Accounting

This post first appeared on August 23, 2007 Part of the hangover that followed the dot-com bubble was rampant accounting fraud. Before then, accounting chicanery was virtually unheard of in Fortune 500 companies. It instead cropped up at high fliers with loose controls and/or overly aggressive cultures (remember Zzzz Best? Miniscribe?). But in 2002, it […]

Representatives Convey and Kaptur Call on Geithner, Fannie, FHFA to Stop Efforts to Pursue Strategic Defaulters

As we’ve noted on this blog, the Administration efforts to punish so-called strategic defaulters seem hopelessly misguided. First, it’s well nigh impossible to tell with simple screens who really could afford their house longer term (ie people who default suddenly, as opposed to wobble in and out of being current on their mortgage before folding, […]

How (Mis)Use of Client Assets Pumped Up Shadow Banking System

One of our regular contributors chatted with a reporter at a major financial media outlet who was frustrated that management was not willing to let him dig into open mysteries from the global financial crisis. Fortunately, the Financial Times takes a broader view, and Gillian Tett today focused on a recent IMF report that describes […]

The Fed’s Fallacious “QE Lite” Logic

The Fed seems to be exhibiting a pretty bad case of “if all you have is a hammer, every problem looks like a nail” syndrome, particularly when it has (or perhaps more accurately, had) other tools at its disposal. In case you somehow missed it, global markets got a bad case of deflation heebie jeebies […]

Steve Keen: Bank Profits a sign of economic sickness, not health

By Steve Keen, Associate Professor of Economics & Finance at the University of Western Sydney, and author of the book Debunking Economics, cross posted from Steve Keen’s Debt Deflation. The record $6 billion profit that the Commonwealth Bank is expected to announce today is a sign of an economy that has been taken over by […]

Summer Rerun: On What the Fed Hath Wrought (So Far)

This post first appeared on August 21, 2007 A gut-wrenching two weeks in the credit markets have been capped by unprecedented moves by central bankers. The ECB’s offer of an unlimited infusion to member banks the week before last was followed last Friday’ by the Fed’s discount rate cut, which included stern warnings that those […]

More Extend and Pretend: HUD Offers $1 Billion of Subprime Teaser Loans

The latest stunt from the Obama Administration on the housing front is a peculiar bit of theatrics at the margin. As Bloomberg reports: The Obama administration will offer $1 billion in zero-interest loans to help homeowners who’ve lost income avoid foreclosure as part of $3 billion in additional aid targeting economically distressed areas. The Department […]

Pimco’s Crescenzi Gets Award for Artless Candor

Bloomberg tells us: The Federal Reserve’s decision to buy Treasuries and keep interest rates low will support “risk assets” without bringing down unemployment, said Anthony Crescenzi at Pacific Investment Management Co. “Low volatility tends to be good for the interest-rate climate,” said Crescenzi, who is based in Newport Beach, California at Pimco, manager of the […]

Guest Post: Strip Mining the U.S. Economy

By Jack Sparrow, who writes at Mercenary Trader The employment picture constitutes yet another headwind and a significant one to the already-faltering U.S. recovery. It will undermine future spending, company earnings and profitability. Indeed, the poorer the employment picture, the greater the likelihood that households will become more cautious and that the corporate sector will […]

NYT Muffs Merrill/Magnetar Piece (Corrected and Updated)

By Yves Smith and Tom Adams, an attorney and former monoline executive Update and correction 4:45 PM: We owe an apology to readers and to Louise Story of the New York Times, for an apparent error in our analysis. We have been informed that, remarkably, there were two separate Pyxis vehicles which were issued in […]

Guest Post: European Banks – Distinguishing the Walking Wounded from the Living Dead

By Max Bruche. Assistant Professor of Economics, CEMFI and Gerard Llobet i Codina, Associate Professor of Economics, CEMFI. Originally posted at VoxEU Bank bailouts have been controversial from the outset, with some commentators saying that they reward banks for making risky loans. This column investigates the idea of an asset buyback in which a special […]