The normally bank-friendly Fed fired an unexpected shot across the industry’s bow today, taking issue with its failure to take sufficiently tough measures to curb undue risk-taking. Per the Washington Post: The Federal Reserve has completed an initial review of compensation policies at 28 large banks it oversees and has been giving them confidential feedback […]
Read more...The New York Times yesterday featured an article by Yale economist Robert Shiller in which he discussed how financial reform had fallen short of addressing the conditions that caused the crisis. He focused on the failure to implement effective pay reform at the large financial firms that too big or otherwise too crucial to fail: […]
Read more...ui
Read more...By Glenn Stehle, an engineer who began working in the oil industry in 1974. After a two-year stint with Cities Service Oil Company, he worked for two years for Henry Engineering, a petroleum engineering consulting firm. Upon leaving Henry Engineering he worked as an independent engineering consultant in all facets of the oil and gas […]
Read more...Well, the BP disaster, in particular the intense press coverage of this week, appears to have provided the Administration with some very useful air cover, by diverting public attention from the final rounds in the battle to reform Wall Street. One of the common arguments against the need to create mechanisms to moderate corporate and […]
Read more...Note the fund is to be established over two years, through a combination of dividend cuts and reduction in spending. Moreover, a planned dividend payment for June 21 is being halted, which would appear to be a meaningful concession. From Bloomberg: Svanberg and Chief Executive Officer Tony Hayward agreed to set aside $20 billion over […]
Read more...By Gonzalo Lira, a novelist and filmmaker (and economist) currently living in Chile and writing at Gonzalo Lira On the occasion of the BP oil spill disaster, President Obama’s delivered an Oval Office speech last night—a masterpiece of milquetoast faux-outrage. The speech was all about “clean energy” and “ending our dependence on fossil fuels”. Faced […]
Read more...FT Alphaville has a very useful chart and related discussion based on Citigroup research, on the question of whether BP could segregate its operations as a precursor to some sort of “good company/bad company” restructuring. Such a move would no doubt be presented as a way to remove the cloud of uncertainty over BP, but […]
Read more...As readers may know, I’ve been consistently disappointed by the Obama Administration: its faux progressive packaging versus its corporatist posture, its half-hearted, halting reforms which are noisily trumpeted as the real thing, its deep seated belief that public antipathy to its initiatives means it needs to work harder on selling its message, when it really […]
Read more...What term do you use to describe spin about spin? Spin squared? Meta spin? Whatever you chose to call it, a classic example is in full view in a New York Times article, “Another Torrent BP Works to Stem: Its C.E.O.” If you were to believe the New York Times, which all too often appears […]
Read more...We’ve taken the liberty of designating the biggest money pits of the financial crisis as “black holes.” And one the characteristics of black holes is that anything that crosses the so-called “Schwarzschild radius” does not escape. That means that it is impossible to obtain any information from inside the Schwarzschild radius. That feature seems particularly […]
Read more...Hhhm, are investigations disappearing into the night just like FDIC resolutions, Friday night massacres so as not to upset the great unwashed public? Joe Cassano, head of AIG’s Financial Products Group and individual most responsible for the insurer’s collapse, will not be prosecuted. Per the Wall Street Journal: Federal prosecutors will not bring criminal charges […]
Read more...This is a post which I originally published at Credit Writedowns earlier today. I have written a number of posts which point to a shift in the center of power on Wall Street from the client-facing advisory business to the market-making trading business. I think understanding this shift is vital to understanding what caused the […]
Read more...Enjoy! View the segment here.
Read more...Former Citigroup CEO Chuck Prince made what could be considered the most infamous statement of this credit crisis when he said: "as long as the music is playing, you’ve got to get up and dance. We’re still dancing." –Citi Chief on Buyouts: ‘We’re Still Dancing’, DealBook, July 2007 This statement was correctly interpreted as a […]
Read more...