While deathbed conversions might earn you a spot in heaven in some religions, they don’t carry you very far here on Planet Earth.
Christine Lagrade has taken too small a step in the right direction far too late to do much good.
Read more...Via e-mail, some updates from Michael Crimmins, a bank compliance expert and member of Occupy the SEC, on the continuing failure of the media to portray the real significance of the JP Morgan London Whale losses: that it revealed glaring deficiencies in internal controls that warrant prosecution of Jamie Dimon under Sarbanes Oxley.
Read more...Earlier today, El-Erian in the Financial Times released a short and apt note on the limits of the central bank put.
Read more...Last week, we saw a host of commentators rush to defend the mini October surprise of a sign of life from the heretofore moribund Mortgage Task Force, in the form of a filing by Eric Schneiderman against JP Morgan for fraud charges under New York’s Martin Act, even though we and others took a dim view of the suit. And even though a bit more information has come out, it doesn’t change our view that this and parallel cases (which the Mortgage Task Force has said it will launch) will be settled quietly, well after the election, perhaps even after Schneiderman’s current term expires, for comparatively little.
Read more...A New York Times profile of Ina Drew, the former head of the JP Morgan Chief Investment Office, almost certainly produced high fives in the bank’s corporate communications office. This piece is the best sort of PR you can get: it treats the trading losses as yesterday’s news, of interest only as point of entre into the downfall of a heretofore unknown but once hugely successful and personally appealing trading manager.
Read more...By Randy Wray, Professor of Economics at the University of Missouri-Kansas City and Senior Scholar at the Levy Economics Institute of Bard College, New York. Cross posted from Economonitor
OK, I know you think this is yet another critical column on Chairman Ben Bernanke.
Read more...During the Microsoft antitrust case, some institutional investors were keen for Microsoft to lose, and not because they were short its stock. They felt that Microsoft being in both the operating systems business and the applications business had become a negative. They believed that separating the two businesses would not only produce higher multiples over time for each as “purer” plays, but having each new business more narrowly focused would be better for growth in the long term.
We have a similar discussion taking place regarding the big banks, and the pro-breakup case is even stronger there than for the software giant.
Read more...Just because the banks are on one side of an issue does not always mean they are wrong, just that they might be right for the wrong reason.
Read more...It looks like Eric Schneiderman is living up to his track record as an “all hat, no cattle” prosecutor. Readers may recall that he filed a lawsuit against the mortgage registry MERS just on the heels of Obama’s announcement that he was forming a mortgage fraud task force. The MERS filing was a useful balm for Schneiderman’s reputation, since it preserved his “tough guy” image, at least for the moment, and allowed his backers to contend that he had outplayed the Administration.
By contrast, we were skeptical of the suit, both in timing and in substance, and thought it had substantial hurdles to overcome. Indeed, despite invoking an impressive-sounding $2 billion in lost recording fees and other harm, the suit settled for a mere $25 million.
Schneiderman has churned out another lawsuit that the Obama boosters and those unfamiliar with this beat might mistakenly see as impressive.
Read more...Gretchen Morgenson has a good piece up today which again proves that no matter how bad you think the mortgage settlement is, it’s worse.
Read more...By Occupy the SEC. Cross posted from their website
Contrary to critics, who seem to think that the only way for Occupy Wall Street to have an impact is by taking to the streets, the movement continues to focus on developing novel ways to reduce the power of a deeply entrenched, abusive financial services industry. One way is by serving as a people’s lobbyist to shine light on the way critical aspects of financial services regulation are negotiated, usually out of sight of the public.
Read more...The mortgage settlement looks to be every bit as bad as cynics predicted. The most exacting and detailed reporting on the settlement terms came from attorney Abigail Field, who undertook the painful process of reading the entire agreement and making sense of what the detailed terms meant. And the latest word from the settlement monitor Joseph Smith is yet another confirmation of the settlement process as enforcement theater.
Read more...By Delusional Economics, who is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.
As I talked about yesterday the outcomes of the failing policies enacted by European leaders in the face of the economic crisis boil down to a lose-lose struggle between international creditors and national citizens.
Read more...April Charney sent me a link to a post which had a condescending explanation of a recent piece by FICO that warrants further discussion. The FICO article attempted to justify its position that someone who enters into a short sale gets his credit score dinged as badly as for a foreclosure. Yes, you read that correctly. One of the reasons many borrowers go to the effort to arrange a short sale, as opposed to the faster and easier process of “jingle mail” is that they assume that the damage to their credit score will be lower.
Here is the rationale….
Read more...Sheila Bair’s new book Bull by the Horns is out and based on early reports, it looks like it skewers the bailouts in general and Tim Geithner in particular. But it also gets a lot into the weeds in what still needs to be fixed in bank-land, which is a part of these crisis post-mortems and retrospectives that too often get short shrift.
Read more...