Ambrose Evans-Pritchard, who has been consistently alarmed about Europe (and often charged in comments of going overboard in general, and on this topic in particular) sounds a particularly loud alarm on Europe, based on the view that the ECB has not eased enough. I have limited insight here. I have been told that German banks […]
Read more...Submitted by Richard Smith, a somewhat jaded capital markets IT professional, aviator and amateur mathematician who lives in London. He has been watching the capital markets from the sidelines for over twenty years. He frets over his ducklings, and should probably get out more. The indefatigable Barry Ritholtz is a fund manager and TV talking […]
Read more...The summary of this video (hat tip reader Barbara): The Federal Reserve is one of the most powerful and secretive institutions in Washington, long considered beyond the reach of lawmakers. But now, as details emerge of how the Fed secretly doled out more than a trillion dollars during the financial crisis, a rare bipartisan movement […]
Read more...Lordie, the theater is beginning to look like a Punch and Judy show, where everything is staged and no one gets hurt. Joe Nocera has a not-too bad piece on the latest comedy of errors, except he takes the Adminstration’s PR way too seriously: Remember that infamous meeting last October at the Treasury Department, the […]
Read more...The Washington Post has a pretty bizarre story up tonight. The Administration is thinking about releasing TARP funds as loans to small businesses. Stress the thinking part. As in big-time thinking. As in long way from action. Which begs the question as to why this is a news story. Since I am of the view […]
Read more...This from an attentive (and well known) investor. I’d provide a link except the press release is not yet posted on Dodd’s website United States Congress For Immediate Release July 10, 2009 Contact: Kirstin Brost/Justine Sessions, Dodd, 202-224-7391 Steve Adamske, Frank, 202-225-7141 Dodd, Frank Ask Regulators to Address 2nd Mortgages Valuation Problems that Discourage Loan […]
Read more...Submitted by Edward Harrison of Credit Writedowns. The video linked below is a must-see piece of journalistic skepticism. The duo at Bloomberg News are discussing the recent alleged theft of trading code by a former Goldman employee Sergey Aleynikov who moved to a hedge fund called Citadel Teza, a hedge fund now being sued by […]
Read more...The Lehman demise refuses to go away. It has come out that the losses appear likely to be $130 billion on what was a roughly $660 billion balance sheet. That is an insanely high level. What has caught my attention from the get-go is that blame was very quickly pinned on the disorderly bankruptcy. While […]
Read more...Another day, another banking industry subsidy. From MarketWatch (hat tip reader Marshall): A panel that oversees a $700 billion bank bailout package said Friday that financial institutions buying out warrants they gave the government in exchange for capital injections are now buying back those stakes at well below their fair value. The Congressional Oversight Panel, […]
Read more...Submitted by Edward Harrison of Credit Writedowns. Yves had a very good post yesterday called “Why Big Capital Markets Players Are Unmanageable” on banks: the former i-banks and commercial banks. The biggest takeaway for me came from her statements regarding the level of responsibility that a junior level employee in an investment bank can have. […]
Read more...Submitted by Edward Harrison of Credit Writedowns. The Nationwide, the world’s largest building society, is now bringing back the dreaded 125% mortgage. While the lender claims these mortgages are a “niche product” designed for customers of Nationwide in negative equity, the Financial Services Authority (FSA) is looking to ban this type of lending. From the […]
Read more...Submitted by Edward Harrison of Credit Writedowns. The Online Merriam-Webster Dictionary describes alchemy as “a power or process of transforming something common into something special” or “aiming to achieve the transmutation of the base metals into gold.” Well, it seems Morgan Stanley is engaging in some financial alchemy because it is about to trade near-junk […]
Read more...John Kay comes perilously close to nailing a key issue in his current Financial Times comment, “Our banks are beyond the control of mere mortal” in that he very clearly articulates the problem very well but then draws the wrong conclusion: At Oxford university, I often hear people say there is nothing wrong with the […]
Read more...An article in the Financial Times give a useful recap of what happened to the financial bugbear of days gone by, namely, the SIV, or structured investment vehicle. Henry Paulson’s failed plan to rescue these not-so-of-balance-sheet entities was front page news for most of the fourth quarter 2007. By the sound of it then, if […]
Read more...Goldman and Barclays are out touting old structured credit technology, apparently collateralized debt obligations, and claim they have been tamed and repurposed and are now virtuous. I am skeptical of these assertions, and welcome informed reader comment. CDOs in particular were leverage on leverage vehicles, and indeed, that seems again to be the reason for […]
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