In the wake of the Treasury Department foisting equity infusions onto nine banks, not all of which wanted or needed them, the industry has decided to get in front of these initiatives. The latest bright idea. of guarantees of bank debt, gets a thumbs down from the intended beneficiaries. But sadly, it isn’t the general […]
Read more...The markets in the US did not take at all well to Henry Paulson’s announcement that he wanted to get his hands on the rest of the TARP allotment (a remaining $350 billion) and spend it so as to help consumers go to the mall again. As one correspondend, Andrew, noted: 1) Is the dog-chasing-its-tail […]
Read more...Too many hot button financial news stories tonight, generally not a good sign for the short-term market outlook. GM is twisting in the breeze, saying it won’t make it through year end without help, but the Bush administration, which has been liberal with aid to anyone who can pretend to be remotely connected to the […]
Read more...The latest back-handed insult may be yet another variant of the Bush “we don’t do multilateralism” syndrome. Unfortunately, as various pundits writing at the Financial Times have pointed out, the US’s stranglehold on power is slipping. Even Obama in the campaign repeatedly said that a country cannot maintain military dominance if it is not a […]
Read more...Last night, we posted a VoxEU article on the unraveling of Iceland that (among other things) said that the problem was that the financial sector had gotten so large that the government could not possibly rescue it. The author made a comment in passing that indicated he thought this was not a problem shared by […]
Read more...Note that the headline above was on a Wall Street Journal story about the new taxpayer-raping improved version of the AIG bailout. The current headline is anodyne: “New AIG Rescue Is Bank Blessing.” Just as one wonders why the government backed down on a deal that was appropriately punitive to AIG (at worst, it was […]
Read more...There are some cool charts, and a useful discussion of the continuing travails of Fannie Mae, at EconomPic Data. Let me give you the high points to induce you to read the rest of the post: Fannie Mae lost a reported $29 Billion in Q3. Over the past 7 quarters, they have now lost ALL […]
Read more...Many years ago, when I was in business school, one of the courses was taught by George Cabot Lodge. He said he could remember distinctly the day in 1968 that it occurred to him that the US could not simultaneously end poverty, send a man to the moon, and fight a ground war in Asia, […]
Read more...As this Bloomberg article discusses in detail, the Fed has violated promises it made to Congress, both regarding the amount it would lend (the amounts are vastly in excess of anything envisaged) and its commitments about transparency (which have gone completely by the wayside). Bloomberg has petitioned to get certain details disclosed via a Freedom […]
Read more...The Wall Street Journal reports, as was rumored on Friday, that AIG appears on the verge of approving a considerably enlarged and sweetened rescue package from the government. We were less than happy with the idea when it first surfaced (see our rant “The Black Hole Gets Bigger: AIG Back for Yet Another Bailout“). Let […]
Read more...We have been reporting from time to time on the impact of the credit crisis on international trade. The main focus has been on how buyers and sellers of cargos are finding it increasingly difficult and costly to obtain letters of credit. However, a second effect is on shipowners themselves, both directly (via plunging freight […]
Read more...The Financial Times reports that AIG is up to its old tricks, back again to the trough for more money. Christmas The Iceland credit default swaps settlement is coming soon, you know. The worst is that AIG is pretending to act as if this is a negotiation as opposed to extortion. Get a load of […]
Read more...Bloomberg has a good report today explaining why the DTCC report saying the credit default swaps market is only $34 trillion in notional outstanding isn’t all that it is cracked up to be. We muttered darkly at the time that some might read more into the DTCC report, released yesterday, than it deserved. Useful is […]
Read more...Although Asian markets opened up nicely on the Obama victory, Europe is focusing on credit market woes, and US futures are down at this hour. From Bloomberg: Credit markets are still creaking even after the biggest decline on record in the rate banks say they charge each other to borrow dollars. The London interbank offered […]
Read more...Early 2007 was a frenzied period for commercial real estate (the February sale of Equity Office Properties Trust by Sam Zell to Blackstone was the market peak), but the 2008 drop, even by the standards of the sometimes-volatile New York City real estate market, is still dramatic. And of course, the credit crunch is immediate […]
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