Category Archives: Banking industry

Wolf Richter: FOMC Minutes Show Fed Doesn’t Know How to Unscramble the ZIRP Omelet

FOMC members are discussing an exit from QE, even the Fed has no clue how to get the financial markets through it in one piece.

Ilargi: Russia’s Central Bank Governor Is Way Smarter Than Ours

Just like the Bank of England hired Mark Carney from Canada, maybe our central bank, the Fed, should hire Elvira Nabiullina from Russia?

Rob Parenteau: Draghi’s Doom Loop(s) – More Than Just the Euthanasia of the Rentiers

Draghi’s Doom Loop(s): why the ECB’s QE, combined with negative deposit rates, could set a 1987 style crash for bonds in motion.

Don Quijones: “Bad Bank” Mania Spreads in Europe

Yves here. I’m not as negative about “bad banks” as Don Quijones is. He does mention the positive result in Sweden, and I hope Swedish Lex will pipe up in comments to add more insight. But the Spanish case is a horrorshow and others in Europe are troubling.

Greece Threatens to Miss IMF Payment, Issue Drachma (Updated)

Greece has decided to up the ante in its negotiations with the Troika. The open question is whether the latest move, the press leak via Ambrose Evans-Pritchard at the Telegraph that Greece will miss its April 9 payment to the IMF so that it can continue to make pension payments, and has started to make plans to issue the drachma, are game-changers that Greece hopes they will be.

Bill Black: We Send Teachers to Prison for Rigging the Numbers, Why Not Bankers?

One has to wonder if the prosecutorial investment in bringing down a public school test-cheating ring has less to do with concern about the students and more to do with charter schools.

Tom Adams: The Ocwen Meltdown: When a Company Discloses Conflicts of Interest, You Should Believe Them

By Tom Adams, securitization professional for over 20 years and partner at Paykin, Krieg & Adams, LLP. You can follow him on Twitter at @advisoryA It’s been a while since I wrote here about Ocwen Financial Corporation http://www.nakedcapitalism.com/2015/02/tom-adams-ocwens-servicing-meltdown-proves-failure-of-obamas-mortgage-settlements.html , the large non-bank mortgage servicer, but things haven’t gotten any better for the company or its […]

Elizabeth Warren Strikes Back as Citigroup Tries to Blackmail the Democratic Party

Citigroup tried to get back at Elizabeth Warren and her allies for daring to call out The Bank That Must Not Be Named. The move looks to have backfired.

Bill Black: Meet Citi’s Ethical Underwriter Who Fought and Won: Sherry Hunt

How Citi ran into a buzz saw and lost a False Claims Act case when it tried stymieing whistleblower Sherry Hunt. But true to form, the DoJ took the easy way out.

The Troika’s Leverage Over Greece: The Ongoing Bank Run

Why Greece’s bank run, and the risk of a banking system collapse, gives the ECB the whip hand over Greece.

Ilargi: Kiev, Moscow, Bonds and Haircuts

Why the proposed Ukraine bond restructuring is a geopolitical matter, part of the US push against Russia via Kiev, and not mere high finance.

Bill Black: How FCIC Spurned Its One Chance at Greatness

How the FCIC not merely ignored but actually suppressed information that revealed what and more important, who, drove the crisis.

How Wall Street Used Swaps to Get Rich at the Expense of Cities

This post by Ed Walker provides a detailed description of how badly municipalities have been fleeced when they bought interest rate swaps from Wall Street as part of financings. It isn’t simply that these borrowers were exploited, but that the degree of pilfering was so extreme that the financiers clearly knew they were dealing with rubes and took full advantage of the opportunity.

But what is even more troubling than the fact set here is the failure of the overwhelming majority of abused borrowers to seek to recover their losses. Walker describes that multiple legal approaches lead you to the same general conclusion: the swaps provider, as opposed to the hapless city, should bear the brunt of the losses. So why haven’t cities like Chicago, that have been hit hard by swaps losses, fought back? Walker does not speculate, but in the case of Rahm Emanuel, it’s not hard to imagine that his deep ties to Big Finance are the reason.