We have what is arguably the best Fed chairman ever ready to roll up his sleeves during the worst financial crisis since the 1930s. Team Obama has asked him to work on…..the tax code. From Reuters: A panel led by former Federal Reserve Chairman Paul Volcker will study options for U.S. tax reform and report […]
Read more...Submitted by Edward Harrison of the site Credit Writedowns Edward Harrison here. This is a post I published just last night over at Credit Writedowns with some minor edits. Barack Obama’s presidency will likely be decided by one single issue – his ability to deal with this financial crisis. With the release of his Treasury […]
Read more...The Wall Street Journal tonight, in “As It Starts Programs, Fed Weighs How to Stop Them,” broaches the touchy subject of how Federal Reserve unwinds all the “support lending” initiatives it has underway and is on the verge of launching. In general, this piece is more wary of party line than the typical WSJ offering, […]
Read more...Submitted by Swedish Lex, who helped unwind Sweden’s imploded banks in the 1990s: The U.S. Secretary of the Treasury appears to be close to proposing a Faustian bargain that, seemingly, will involve considerable Government subsidies towards a limited number of economic operators. In return for the sacrifice – the creation of massive moral hazard – […]
Read more...The kabuki continues. The story from the Washington Post on AIG bonuses would appear to represent a modest win for taxpayers: American International Group is doling out tens of million of dollars in bonuses this week to senior employees. While AIG agreed to pay the bonuses months before the government’s rescue of the company began, […]
Read more...Ooh, the posturing is getting interesting. As we noted in Links last night, Timothy Geithner has already climbed down from his “currency manipulator” saber rattling by pressing the G-7 to deliver a much more China-friendly statement on what they’d like to see it do with the yuan (the original version urged letting it appreciate. the […]
Read more...Readers may have noticed that Team Obama has put on a pre-G-20 session push to have participants spend more to pull the global economy out of its nosedive. The New York Times gave a short summary: In recent days, the White House has begun signaling that when leaders of the Group of 20 nations meet […]
Read more...Submitted by Rolfe Winkler, CFA, publisher of OptionARMageddon.com Policy-makers not only misunderstand the economic crisis, they continue to underestimate it. Consequently, solutions to date have not only failed to “fix” anything, they have made the problem worse. The problem isn’t falling asset prices, it’s not rising foreclosures, it’s too much debt. With an assist from […]
Read more...Before I start shredding “Nationalize? Hey, Not So Fast,” by Alan Blinder in the New York Times, let us first go back to the basic problem,, nomenclature. Blinder does not specifically do so in this article, but opponents to nationalization often raise the image of enterprises being expropriated by the state, in other words, healthy […]
Read more...Even though I often take on the Wall Street Journal’s depiction of new stories, the flip side is that it does break significant news stories. Today is one of those days, although I wonder about an item this juicy hitting the wires on a Friday evening. Remember that the reason for shoring up AIG was […]
Read more...Paul Keating, former Austrailian Prime Minister, gave an assessment of Timothy Geithners’ performance in the Asian crisis that is sharply at odds with US reports. According to Keating, Geither completely misread the nature of the crisis, that it was the result of hot money flight, but reverted to the standard IMF “country facing currency crisis” […]
Read more...We have sometimes pointed to a paper by Nobel prize winner George Akerlof (of “markets for lemons” fame) and Paul Romer on the phenomenon of looting. Forgive us for repeating ourselves, but this paper was written in the wake of the savings and loan crisis, and was clearly ignored, because if anyone had heeded their […]
Read more...This tidbit comes in a Wall Street Journal story, “Top Treasury Candidates Pull Out“: Treasury has identified and is vetting other people for top slots, including H. Rodgin Cohen, chairman of top law firm Sullivan & Cromwell LLP and an adviser to virtually every firm on Wall Street, for the deputy secretary position, two people […]
Read more...The British don’t do shrill, but Wolf today is as close as you will ever find on the pages of the Financial Times. And the telling sign that Wolf is borderline unhinged is (aside from mentioning his fury) that his article has less of a clear structure than his comments usually do. But he nevertheless […]
Read more...The Treasury today announced its so-called “Making Homes Affordable Program”. I am clearly an old fart. The fact that the Treasury bothered to have a logo created for the program (do consumers and servicers really need brand imaging when having money shoved at them?) gives me more than a little pause. I will nevertheless try […]
Read more...