Ah, today the Financial Times reminds me of the way it was back in early 2007, when it was clearly heads and shoulders above any US paper. Wonder why I have fewer days like that, It isn’t improved reporting by the US media (although they are further down the curve). I suspect that the FT […]
Read more...Before readers start throwing brickbats at the mention of the name of Alan Greenspan, it’s important to remember that he has become the poster boy of the policy errors that lead to our financial mess. And that isn’t an accurate picture. This crisis had many parents, and even though Greenspan was one of the key […]
Read more...By way of background, William Black is a former senior bank regulator, best known for his thwarted but later vindicated efforts to prosecute S&L crisis fraudster Charles Keating. He is currently an Associate Professor of Economics and Law at the University of Missouri – Kansas City. More germane for the purpose of this post, Black […]
Read more...The China bulls have commented approvingly on the growth in loans in China, seeing it as a sign of pending recovery, along with an upswing in stock prices. We’ve pointed out that economist and China commentator Michael Pettis has heard quite a few reports that many of these loans were in fact sham transactions to […]
Read more...One of our beefs has been the lack of any progress, even interesting trial balloons, on the financial firm reform front. And that’s a serious problem. Economists like to point to the Great Depression as the textbook example that fiscal stimulus works. FDR launches a bunch of spending plans, and voila, by 1936, the economy […]
Read more...Those on the hedge fund beat may recall how themasters of the universe have in most cases suffered a reversal of fortune. 2008 was a bad year for most strategies, and the perterbations of September and October made matters worse. Sudden plunges in markets lead to margin calls, and the funds would sell whatever seemed […]
Read more...Just when you thought most of the bad news was out in the open, another ugly problem raises its head. Remember collateralized loan obligations? They last got press because investment banks were stuck with a whole bunch of them as unsold inventory, and their erosion in value was wreaking havoc on investment bank balance sheets. […]
Read more...We’ve commented from time to time that a possible financial flashpoint is countries that got themselves in the same fix as Iceland , of having a banking sector engaged in the generally risky practices that were standard form recently, and was outsized relative to the economy (Willem Buiter also points out that that precarious situation […]
Read more...In case you think my headline is too harsh, consider the one at Bloomberg: “Obama to Work on Executive Pay Limits After Industry Complaints.” So in case you were laboring under the delusion that widespread managerial failure among the nations’ top banks, to the point of being dependent on taxpayer provided drip-feeds among the nation’s […]
Read more...I must confess to having read only a bit of economist Axel Leijonhufvud’s writings, but what I have seen, I have liked very much. Leijonhufvud’s current post at VoxEU does a very good job of looking at the economic mess the US is in and assesses policy options. It is a remarkably straightforward piece. Most […]
Read more...Last week. Bloomberg reported that Volcker, who many regard as the best asset on Obama’s economics team, is sorely underutilized: Paul Volcker has grown increasingly frustrated over delays in setting up the economic advisory group President Barack Obama picked the former Federal Reserve chairman to lead… Volcker, 81, blames Obama’s National Economic Council Director Lawrence […]
Read more...Reader Russell had wondered whether the attorney general of North Carolina might go after Bank of America over the difficult-to-rationalize bonuses paid to Merrill staff, given that the Charlotte bank had signed off on them (failing to inform and obtain consent Bank of America would have been grounds for terminating the deal). I had thought […]
Read more...Your humble blogger has said that rationalizing and recapitalizing the banking system is essential for recovery. Economists like Ben Bernanke attribute Japan’s failure to dig itself out of its hole to not being aggressive enough in terms of fiscal and monetary stimulus,. Yet Japan did a great deal on both fronts. The biggest difference between […]
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Read more...We are supposed to be impressed with the speed and scale of government action on the bank front. As reported in the New York Times: Nearly 100 federal banking regulators descended on Citigroup in New York on Wednesday morning. Dozens more fanned out through Bank of America, JPMorgan Chase and other big banks across the […]
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