This post first appeared on March 14, 2007 One of today’s lessons is to have greater courage in my convictions. In a number of earlier posts (such as “The Rising Tide of Liquidity,” part 2 and part 3 of the same, “Where Has the (Perception of) Risk Gone“) I pointed to how toppy the markets […]
Read more...Joint post by Richard Smith and Tom Adams, a securities lawyer The fabulous Fab has entered his solo response to the SEC’s complaint. It provides an interesting glimpse into what are certainly complex legal strategies by Tourre, Goldman and the SEC. The list of his stated defenses are at the bottom. First, the response may […]
Read more...This post first appeared on February 18, 2007 Mirable dictu, a Wall Street Journal editorial, “How Expansions Die,” that, for the most part, has a solid foundation in reality. Although the WSJ’s news pages have been reporting on the meltdown in the subprime mortgage market (admittedly somewhat less intently than the Financial Times), both the […]
Read more...Back to this thing to try to work out what it’s driving at. Yves wrote: I have serious trouble with its bottom line: We document that the shadow banking system became severely strained during the financial crisis because, like traditional banks, shadow banks conduct credit, maturity, and liquidity transformation, but unlike traditional financial intermediaries, they […]
Read more...Tonight I am initiating summer reruns, a replay of posts I particularly liked from 2007, 2008, and early 2009 (the blog started in late December 2006). This selection represents roughly the top 1% of the pieces written then. I picked this window because it overlaps with the crisis (although the replays of posts from the […]
Read more...To say there is no love lost between Treasury and Elizabeth Warren is probably putting it mildly. Treasury was gunning for her ouster in early 2009; I heard multiple accounts both of how concerted the Administration opposition to her was (recall she was actually chosen as head of the Congressional Oversight Panel before the regime […]
Read more...By Tom Adams, an attorney and former monoline executive and Yves Smith A common fallacy is to assume that situations are polar: win/lose, black/white, hot/cold, heads/tails. But more often, given A, “not A” is not the opposite of A. Conventional wisdom in the financial media is that the settlement announced by the SEC over its […]
Read more...Simon Johnson deserves tons of kudos for pointing out that the US is in the hands of financial oligarchs, via his celebrated Atlantic article, “The Quiet Coup.” But having recognized a clear and present danger, he seems peculiarly willing to confuse non-solutions with meaningful measures. In an article at Project Syndicate, he incorrectly celebrates a […]
Read more...If you have any doubts about how easy it is for someone who works hard in the US to get ahead, consider this factoid from Martin Wolf’s latest comment in the Financial Times, on Raghuram Rajan’s new book (see Satyajit Das’ review here: Thus, Prof Rajan notes that “of every dollar of real income growth […]
Read more...A well placed Washington contact wrote: I was in a discussion with the staff at one of the Federal agencies involved in housing to ask them about the new policies on strategic defaults. It became clear almost immediately that regulators obviously have no idea how to identify strategic defaulters except by asking big banks. They […]
Read more...Satyajit Das is too shrewd to call the European Financial Stability Facility, informally described as a €440 billion sovereign bailout fund, a mere sleight of hand. But it’s hard not to draw that conclusion after reading his Financial Times comment today. Central banks and governments have developed an alarming fondness for the very sort of […]
Read more...When I was in the UK earlier this year, I saw a very senior financial regulator speak. In the Q&A session, someone asked him to comment on US financial reform. His reply was tantamount to “Wake me when it’s over,” and it was clear his expectations were low. One source of frustration is that the […]
Read more...The reporting so far is thin, just notices of the announcement at Bloomberg and the Wall Street Journal that Moody’s cut the rating on Portugal’s sovereign debt from Aa2 to A1. The Bloomberg headline notes that Moody’s put the outlook as stable, while the Journal pointed out that the agency expected “Portuguese government’s financial strength […]
Read more...Der Spiegel (hat tip reader Richard Smith) presents a detailed sketch of German thinking, specifically that of chancellor Angela Merkel and finance minister Wolfgang Schäuble, regarding how countries who fail an initial round of restructuring within the eurozone would be treated. This piece is very much worth reading, but the German proposal has all the […]
Read more...By Wallace C. Turbeville, the former CEO of VMAC LLC and a former Vice President of Goldman, Sachs & Co. who writes at New Deal 2.0 William D. Cohan’s op-ed piece in the July 7th New York Times had the same title as this article, but for the word “Don’t.” At first glance, I thought […]
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