Category Archives: Federal Reserve

Run for the Hills: Fed Plans to Build on Sham Stress Tests as Basis for Regulation

As readers may recall, we and just about anyone who understood anything about financial firm supervision saw the stress tests as a complete and utter farce. The authorities had tea and cookies with the 19 banks and then talked about model outputs. The talks sometimes got heated, so were were supposed to take this as […]

Geithner Bullies Financial Regulators to Accept Fed as Top Dog

The Wall Street Journal reports that Timothy Geithner tongue-lashed Federal financial services regulators over their bucking the Obama Administration initiative for the Fed to become The One Regulator to Rule Them All. This comes on the heels of Congressional testimony which showed rather clearly that the key actors were not singing from the same hymnal. […]

Government Taken in Dealings with Wall Street: Accident or Design?

We’ve grumbled at points during the process of throwing various lifelines out to the financial sector, that media has tended to focus unduly on the TARP (no doubt encouraged by the powers that be who are eagerly pushing “the banks are fine” line) at the expense of the vast net of additional subsidies. The ones […]

Did Federal Reserve Remove Some Embarrassing Bernanke Testimony?

Readers, I will confess I am only a user of garden variety search tools, with no special training, merely years of trial and error. I am having to do a quite a bit of rooting around these days to track down support for various arguments I am putting together for the book. I decided to […]

Guest Post: Representative Alan Grayson on His Questions to Bernanke Over Dollar Swap Lines

From Congressman Alan Grayson, member of the House Financial Services Committee and representative to the 8th Congressional District of Florida: Hi, Alan Grayson here. I just questioned Ben Bernanke in a Financial Services Committee hearing over the Federal Reserveís use of swap lines. You can watch the clip here. There was some good discussion on […]

Bernanke outlines Fed’s easy money exit strategy

Submitted by Edward Harrison of Credit Writedowns. Over the past week, America’s banks have had a bumper earning season, in part courtesy of the Federal Reserve’s accommodative monetary policy. Even before this week, a number of market pundits (including me) began to wonder aloud whether the Fed had any strategy with which to remove all […]

Alan Grayson: "Where is the half a trillion dollars the Federal Reserve lent to foreigners?"

I found this exchange intriguing. First, the unflappable Bernanke looks stressed. I can’t put my finger on why, but the Congressional attacks seem to be getting to him. Second is the stunning lack of candor as to why the dollar swap lines were put in place, that there was massive dollar deleveraging happening. It would […]

Denninger Savages WaPo Defense of Goldman

It simply amazes me that those who are cheerleading the seeming return of Wall Street to health overlook the extensive, hydra-headed subsidies they’ve received and continue to receive. The media has bought and is touting the line, “Hey, they (more accurately some) paid back the TARP, so what’s the beef?” Let us consider the other […]

Quelle Surprise! The Fed is Reporting Losses on Its Bear Stearns and AIG SPVs

Readers may recall that during the heat of bailout battle, the Federal Reserve got into the fancy finance business, relying on the sort of deal structuring sometimes used to try to turn toxic odd pork scraps into barely-digestible sausage, the procedure used for pigs so dead that merely putting lipstick on them just won’t do. […]

Guest Post: Richard Alford on Target Fixation and the Fed as Systemic Regulator

Submitted by Richard Alford, a former economist at the New York Fed. Since them, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. TARGET FIXATION AND THE FED AS THE SYSTEMIC REGULATOR Target fixation is a process by which the brain […]

"The Fed Under Fire"

The summary of this video (hat tip reader Barbara): The Federal Reserve is one of the most powerful and secretive institutions in Washington, long considered beyond the reach of lawmakers. But now, as details emerge of how the Fed secretly doled out more than a trillion dollars during the financial crisis, a rare bipartisan movement […]

Make Sure You Get This One Right

Submitted by Edward Harrison of Credit Writedowns. This post is from Niels Jensen of Absolute Return Partners. I have featured his monthly newsletter a number of times on Credit Writedowns (here’s the link to the last one, hilarious title). Jensen is very good. Visit www.arpllp.com to learn more about Absolute Return Partners and to sign […]

"Quantitative easing, credit easing and enhanced credit support aren’t working; here’s why"

Dear readers, we are NOT setting out to have a Willem Buiter-fest this weekend. It’s simply that this is a slow news period and Buiter has a good post after the first video clip I’ve ever seen of him. So if there was more activity, the Buiter-density would be lower. The Anglophile Dutch economist has […]

S.F. Fed chief Yellen tells inflationistas to pipe down

Submitted by Edward Harrison of Credit Writedowns. Of late, there have been a lot of worries about he potential for inflation in the U.S. Marc Faber is the most noted pundit in this regard. Over-the-top comments he made back in May about hyperinflation in the U.S. may have been a catalyst for all of the […]

Reader Sanity Check: Interest Rate Policy, Leverage and the Financial Crisis

There are some interesting things one learns in putting together a book. Blogging is a lot like working in watercolors, speed and confidence in execution are key, versus the oil-painting medium of a book. And you learn how many times you wind up scraping the canvas and reworking. I’m up to the sixth revision of […]