The title of this Telegraph article may strike some US readers as alarmist, and since one of the two authors is Ambrose Evans-Pritchard, a card carrying member of the uber-bear club, it may be easy to dismiss it. But that would be a mistake. I was in Austria in December, meeting with some local businessmen, […]
Read more...Even though Congress in general seems pretty clueless on matters financial (the Wall Street/high end variety), some members appear to understand the mindset. One consequence of the ever-delayed “buy the bad assets” program, which clearly has to pay at or above banks’ current marks (otherwise they show losses, which hurts their capital bases, something that […]
Read more...I cannot recall a major US policy initiative being met with as much immediate revulsion as the so-called Geithner plan. Even the horrific TARP, which showed utter contempt for Congress and the American public was in some ways less troubling. Paulson demanded $700 billion, nearly $200 billion bigger than the Department of Defense, via a […]
Read more...The Freddie/Fannie conservatorship, which seemed like an epic event at the time, was succeeded by so many crises, Lehman, the September/October meltdowns, AIG, the European bank rescues, that it seems like a distant memory. But the Treasury made a commitment to maintain positive net worth for both the mortgage lenders/guarantors and was remarkably non-specific as […]
Read more...That one word assessment of the Geithner plan, as previewed in the New York Times tonight, comes from reader Scott, and is good enough to print. I am so disgusted with this entire proceeding that I am going to dispatch it quickly. Let’s start with the basics. The US banking system is insolvent. Got that? […]
Read more...I’ve never seen Martin Wolf speak before, and he’s refreshingly energetic and direct. Watch Part One here. And Part Two.
Read more...We’ve been of the view that despite its theoretical advantages, (enabling various liabilities and cliaiims to be restructured more easily) a bankruptcy filing for a big automaker would be likely to lead to liquidation. A pre-pack is impossible for companies of this scale; an article in the Deal laid out the process and contended that […]
Read more...Remember the embarrassing ten weeks of so of Henry Paulson failing about to try to get his “get the bad assets out of the structured investment vehicles” effort, the MLEC, also fondly known as The Entity, off the ground? It quietly faded from the headlines.. Why? It was supposed to be a private sector solution, […]
Read more...Churchill’s famous dictum, “Democracy is the worst form of government, except for all those other forms that have been tried from time to time,” could also be applied to mark-to-market accounting. However, like democracy, mark-to-market may be on its last legs. The stock market rally of late last week was fueled by the rumor that […]
Read more...David Sirota at Salon gives a concise, brutal assessment of Obama’s economic team and its priorities. We’ve now had two bait and switch Presidents in succession. Bush promised “compassionate conservatism” and dragged the country far to the right, enriching those at the top of the food chain and leaving everyone else with the empty promise […]
Read more...Even before its inception, we’ve been very skeptical of the TARP. Paulson managed to get the type of spending authorization that you only see in wartime, with almost no contraints on what he could do, and most troubling, put himself beyond the reach of law. From the original draft of the bill: Decisions by the […]
Read more...Like sports achievements, I have no doubt this so-called record will be broken soon, and in short order. From the Financial Times: US credit card delinquencies hit a record high in January, and further deterioration is likely as the economy slows down and unemployment rises, Fitch Ratings says. Payments at least 60 days late rose […]
Read more...Your humble blogger, and the vast majority of readers have been pretty skeptical of the notion that the Fed could absorb $29 billion of risk on $30 billion of dodgy Bear Stearns assets and come out whole (JP Morgan takes the loss on the first billion and change). Despite reports from the Fed showing no […]
Read more...Guest blogger and former Congressional staffer Lune was kind enough to provide this post on Volcker’s testimony before the Senate Banking Committee today. Enjoy! From Lune: Paul Volcker, former Fed chief and currently the head of President Obama’s Economic Recovery Advisory Board, and the chairman of the Group of Thirty, testified to the Senate Banking […]
Read more...I believe I am permitted to hyperventilate only once in an evening, so I’ll have to act with a modicum of restraint here. The Obama executive compensation restrictions for bailout fund recipients have been leaked, and may be long enough on appearances to appease an angry US electorate. But the shortcomings of the supposedly tough […]
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