Category Archives: Banking industry

"Does Securitization Affect Loan Modifications?"

A study by the Boston Fed came to the credulity-straining conclusion that securitization was not a culprit in the noteworthy dearth of loan mods on residential mortgages, Lew Ranieri remarked back in 2008 at the Milken Conference that he was appalled by what was going on, that servicers used to do mods (as in no […]

Germans must get their head out of sand on banks

Submitted by Edward Harrison of Credit Writedowns. Germany never participated in the upswing of the housing bubble. This fact has led German politicians of all stripes to mistakenly believe their banking system was somehow immune to the problems infecting bubble markets like the US or Spain. Unfortunately, it has not worked out that way because […]

Odd Mortgage Refinancing Sighting

This is admittedly one data point, but one has to assume that Citi is making similar calls to others similarly situated. From a reader: I had an interesting conversation yesterday with a neighbor of mine. He said that he and his wife received a call from Citibank offering to refinance their mortgage at a lower […]

Denninger Savages WaPo Defense of Goldman

It simply amazes me that those who are cheerleading the seeming return of Wall Street to health overlook the extensive, hydra-headed subsidies they’ve received and continue to receive. The media has bought and is touting the line, “Hey, they (more accurately some) paid back the TARP, so what’s the beef?” Let us consider the other […]

Quelle Surprise! The Fed is Reporting Losses on Its Bear Stearns and AIG SPVs

Readers may recall that during the heat of bailout battle, the Federal Reserve got into the fancy finance business, relying on the sort of deal structuring sometimes used to try to turn toxic odd pork scraps into barely-digestible sausage, the procedure used for pigs so dead that merely putting lipstick on them just won’t do. […]

CIT Makes Tentative Deal With Bondholders to Avert Bankruptcy

CIT appears to have reached an out-of-court restructuring, which includes having current bondholders provide financing. From Reuters: CIT Group Inc has reached a tentative deal with a bondholder group for $3 billion in rescue financing, which the lender hopes will help it avoid bankruptcy,… The bondholder group, which includes Pacific Investment Management Company (Pimco) and […]

Guest Post: Review of Ferdinand Pecora’s "Wall Street Under Oath"

Submitted by DoctoRx, who comments on the economic and financial scene at EconBlog Review. In a few months during what was likely the worst financial crisis of the Great Depression- the tumultuous events of early 1933 culminating in closure of all banks in most states and then FDR’s sweeping bank “holiday”, a man who had […]

Ambrose Evans-Pritchard Says End of the Financial World is Nigh

One of the good things about those of the Austrian persuasion is that they serve to protect the flanks of the merely skeptical like me. I am not exactly keen Ambrose Evan-Pritchard’s prescription, which is greater monetary easing with more fiscal restraint. I put banking industry reform (of the root and branch sort) very high […]

Bank of America Sent to the Woodshed, Big Time (And Citi Going There Too)

The Wall Street Journal has quite a bombshell, namely, that the Fed and the Office of the Comptroller of the Currency have ordered the Bank of America to make changes to its board and clean up its risk and liquidity management. The bank is under the shortest of regulatory short leashes, a memorandum of understanding, […]

Wells sells $600 million in distressed assets at 35 cents on dollar

Submitted by Edward Harrison of Credit Writedowns. I got a tip from a friend Andrew about a sale of assets by Wells Fargo (WFC) which raises a number of interesting questions. He sent me the following 14 July article from the Milwaukee Business Journal. Wells Fargo sold $600 million in mostly non-performing subprime loans to […]

Bair and Bernanke Back Size Disincentives For Banks

In an about-face, the Administration seems to be getting serous about trying to Do Something about the too-big-to-fail syndrome. Or is it? The proposal comes from Shiela Bair, and does not have the support of the Treasury Department. Curiously, Bloomberg reports that Bernanke has endorsed the Bair plan, which unusually puts him in opposition with […]

Did Markit’s Owners Trade CDS on Advance Access to Information?

We have a juicy tidbit on the wires tonight. The Department of Justice is conducting an investigation into whether Markit’s clients traded on its research prior to its being made public, As much as I would love to see the credit default swaps market reined in, or better yet, shut down, this move is puzzling. […]

Is Meredith Whitney bullish now?

Submitted by Edward Harrison of Credit Writedowns. Just when I was wondering where Meredith Whitney had gone, she’s back. But she has a whole new tone to her. In this interview on CNBC, she says she is expecting a monster number from Goldman (GS) tomorrow morning, in 2010 and in 2011. She is well above […]

How globalisation led to universal banking in America

Submitted by Edward Harrison of Credit Writedowns. Last week, I followed up Yves Smith’s excellent post on “Why Big Capital Markets Players Are Unmanageable” with “More on why big capital markets players are unmanageable.” I would like to extend the discussion beyond the U.S. border into a look at how the universal banking model abroad […]