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...Goldman has just issued an eight page letter to shareholders, in which it tries to defend itself against its critics, particularly regarding its conduct vis-a-vis AIG, with how it got short the residential mortgage market, and its compensation. To be more terse than usual: the AIG argument is generally plausible (and not inconsistent with what […]
Read more...The Kraft acquisition of Cadbury provides a vivid illustration of why the US model of screwing workers to preserve executive bonuses does not go over well abroad. Brief synopsis: Kraft acquires the 200 year old British confection-maker Cadbury after a heated battle. The chairwoman and CEO Irene Rosenfeld (already not a good sign, best practice […]
Read more...Perversely, what prompted me to read Lawrence Kotlikoff’s new book, Jimmy Stewart is Dead, was a review that described his proposal as forcing all banking to become mutual funds. That seemed both radical and naive, but coming from a well known economist, I thought it would be interesting to see if he could make a credible case.
Read more...Rampant fraud in the mortgage industry has increased so sharply that the FBI warned Friday of an "epidemic" of financial crimes which, if not curtailed, could become "the next S&L crisis." Assistant FBI Director Chris Swecker said the booming mortgage market, fueled by low interest rates and soaring home values, has attracted unscrupulous professionals and […]
Read more...Via an e-mail from someone who has worked at the SEC. Note that the reason for the mention of the Department of Justice is that the SEC cannot bring criminal cases on its own, but has to secure the cooperation of the DoJ. The SEC-DoJ relationship is not entirely functional, but I suspect that the […]
Read more...I had not pointed to the letter written by Matthew Lee, the so-called Lehman whistle blower, because it seemed to add little to the main story: insider alerts senior management to a Big Problem (or in Lehman’s case, that its chicanery/incompetence was so pervasive as to be impossible for anyone within hailing distance of it […]
Read more...The Fed, having performed abysmally in recognizing the growth of a global debt bubble, and then having botched the early-stage reactions (after each of the first three acute phases, it went into Mission Accomplished mode), now is pushing not simply to hold its turf, but expand its sphere of influence. From the New York Times: […]
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