The saga of Harvard Management Company’s relationship with its lead law firm, Ropes & Gray, is a cautionary tale for those who like to believe that private equity investors are doing a good job of taking care of their interests. Just follow the money.
Read more...The Fukushima nuclear plant crisis continues unresolved in a bad way.
Read more...If we go by the rumors circulating in the financial press, the Obama Administration is on the verge of selecting a proven failure – Lawrence Summers – to be the next Chair of the Federal Reserve System. We can, and need to, do a lot better than that.
Read more...I’ve been gobsmacked to see that not only is Larry Summers on various short lists of candidates to become the next Fed chairman, but that Summers is also supposedly closing in on the favorite, Janet Yellen.
Read more...Yves here. Aside from the foursquare case that Professor Black makes for reinstituting Glass-Steagall, another important set of arguments came in 2009 from Andrew Haldane, director of financial stability at the Bank of England.
Read more...What sexual favors were exchanged so that the New York Times blunted the impact of an important, detailed investigative story on Goldman profiteering, this time in the aluminum market, by releasing it on a heat-addled summer Saturday?
Read more...Yves here. This post is yet another reminder of how most companies’ first line of defense when they have engaged in seriously bad conduct is to lie, no matter how flagrant the lie is. Recall during British Petroleum’s Deepwater Horizon crisis when the oil producer repeatedly and grossly misrepresented the flow rate from its out-of-control well.
Read more...Yves here. This post illustrates yet another sign of decay among the ruling classes: that of not even bothering to go through the motions of following stipulated political and regulatory processes.
Read more...One of hedge fund manager David Einhorn’s saying is “no matter how bad you think it is, it’s worse.” An article in Washington Monthly, Special Deal by Haley Sweetland Edwards, deep dives into one big and largely hidden reason why medical costs in the US are out of control and are unlikely to be reined in any time soon.
Read more...Yves here. One of my colleagues is back from a month in Europe (a lot of travel, and lots of meetings with economists and political types). I need to debrief him more fully, but his short take was Portugal is clearly in crisis, with Spain and Italy not far behind, and that the political train wrecks will hit faster than the economic ones. Although I can’t see how the former won’t accelerate the arrival of the latter.
Read more...Yves here. This post looks at the unwinding of quantitative easing in the UK and raises some concerns.
Read more...Yves here. I suspect NC readers can go even further will Bill Black’s question!
Read more...The top Republican on the House Financial Services Committee has tucked a provision into his mortgage finance reform bill that would create a privately held “National Mortgage Data Repository.” The repository would basically look like MERS, the bank-owned electronic database tracking mortgage transfer. The difference is that, while MERS’ activities have drawn legal challenges across the country, the National Mortgage Data Repository would have the force of statute to carry out the exact same behavior. According to the bill text, any document arising from this repository would be seen as presumptively legal, pre-empting state and federal laws on demonstrating the right to foreclose.
Read more...I’m going to be brief, in part because the CFTC’s probable demonstration of lack of gumption is still in play, while the SEC’s was expected but nevertheless appalling. But the bottom line is that even though we seem some intermittent signs of the officialdom recognizing that big banks remain a menace to the health and well-being to the general public*, the measures to constrain them continue to be inadequate.
Read more...Sadly, we’ve entered into a world where the word “corruption” has become inadequate to describe the many and varied practices of profitable abuse by the powerful and connected of their inferiors. Like the popular (and sadly apocryphal) accounts Inuit with their numerous words for “snow,” we need more refined and granular terminology to describe various types of corruption. Hugh uses “kleptocracy” but that’s a name for a system of governance, not particular behaviors within that system.
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