Category Archives: Regulations and regulators

Obama Signs Bill to Exempt US Airlines from EU Aviation Carbon Tax

I managed to avoid listening to pretty much all of Obama’s election victory speech but managed to click onto a news site that had a streaming video of it, and caught his tepid reference to climate change, a passing comment on “the destructive power of a warming planet.” This wasn’t a commitment of any kind; I took this as a sign simply that the president now feels he has to give global warming lip service.

This news story, of Obama undermining an EU carbon tax, is consistent with that theory.

Why Robert Khuzami Would Be a Terrible Choice to Head the SEC

Given that the Obama Administration appears to think that missing-in-action Attorney General Eric Holder has been doing a fine job, it probably isn’t surprising to see the SEC’s head of enforcement, Robert Khuzami, included on a short list of names rumored to be under consideration to head of the agency.

But if the object is to prove that regulators can’t regulate and it’s too hard to enforce securities laws, then Khuzami’s your man.

Spain About to Whack Hapless Smaller Savers Conned into Buying Bank Preference Shares as a Condition of its Bank Rescue

Yves here. We’ve flagged in earlier posts how the Spanish banking crisis had the potential to become destabilizing politically, as if Spain wasn’t already at considerable risk of upheaval. Spanish depositors were pushed to convert their deposits into preference shares, which they were told were just as safe. That of course was never true.

This was a simple desperation move by the banks to save their own skins, customers be damned, by raising equity from the most unsophisticated source to which they had access. And now that that gambit failed, these shareholders are due to have those investments wiped out unless the Spanish authorities can cut a deal to spare them. The conditions of a bank rescue, which Spain did try to resist, was to have equity holders wiped out, or at least haircut. And that plan is now about to be set in motion. Having losses imposed on small savers who were in many cases conned by their own bank to buy these preference shares is going to do serious harm as well as further delegitimate the government.

NC’s Guess About a Sean Quinn-GT Group Connection Just Got a Bit More Solid (But a Bit More Ho-Hum, Too)

More about a possible link between bankrupt Irish ex-billionaire Sean Quinn’s asset hiding activities and the Taylor family’s company registration businesses (GT Group and successors)

Marshall Auerback: Bank of Canada Governor is Wrong on Too Big To Fail and Wrong on Canada’s Banking System

Yves here. It was very telling, and disappointing, to find out that the Governor of the Bank of England in waiting, Mark Carney, has been critical of the ideas of Andrew Haldane, the executive director of financial stability of the Bank. Haldane has the goods on major banks, and has come up with both colorful and insightful critiques as well as creative solutions. It now becomes clear why George Osborne made this surprising pick: Carney sees nothing wrong with large, universal banks, while the departing Governor, Mervyn King, Haldane, and the head of the soon-to-be-disbanded FSA, Adair Turner, were unified in their desire to cut the mega-banks down to size.

By Marshall Auerback, a portfolio strategist, fellow with the Economists for Peace and Security, and a research associate for the Levy Institute. Cross posted from New Economic Perspectives

As a Canadian, perhaps I should feel a surge of patriotic pride now that Mark Carney has been designated the new head of the Bank of England – quite a step up for the current governor of the Bank of Canada. That said, his recent attack on the Bank of England’s Andy Haldane in a Euromoney interview last month, does give one some cause for concern, particularly as it evinces the usual complacency that most Canadians seem to feel about the basic soundness of their own banking system, which essentially upholds the universal banking model as a viable one.

At Least Half of the 21,500 Companies Revealed by the Guardian/ICIJ Offshore Investigation Have Connections With Rogue Agent GT Group

The GT Global sham company network may be far bigger than you ever imagined.

Welcome to the Future of Your Health Insurance. It Sucks.

There have been numerous reports about the shortcomings of Obamacare which its boosters have either ignored or shouted down. And troublingly, the attitude is often “I got mine” as in “My kids are now covered under my policy” without questioning what the narrow and broader issues are.

Well, I’ll tell you I got mine too. My current policy, which on paper is actually quite good, has a lifetime cap. Under the ACA, it is grandfathered and the cap is removed. And I’m still here to tell you that the future sucks. This deal enriches Big Pharma and the health insurers at the expense of the public at large. And the result of that will be a worsening of the already lousy health care system in the US. And I can give you a feel for what your future is likely to look like. It’s not pretty.

The 0.1% Circles the Wagons: Buffett Pumps for Dimon as Treasury Secretary

Well, given that our current Treasury secretary was forgiven for being a tax cheat (Turbo Timmy never did settle up for his underpaid taxes that were beyond the IRS statute of limitations), there is a certain logic in upping the ante with his replacement. Having a Treasury secretary who is a slam-dunk case for criminal Sarbanes-Oxley violations (see here and here) as well as running a bank where the auditors signaled the worst level of accounting failure short of signaling “going concern” worries is par for the course for the ever-risinng level of corruption among what passes for our elites.

Mirabile Dictu! Regulators Using Trading Scandals to Push for Tougher Capital Requirements

Most news reports on financial regulatory reform hew to a few storylines: banks pushing back in private and winning on diluting regulatory reform; banks attributing lousy profits to new regulations (with a notable lack of proof of this convenient blame-shifting); bank regulators demonstrating capture, corruption and incompetence (which even though true to a fair degree is played up by industry incumbents to support the notion that regulation is futile).

So it’s refreshing to see a contrasting storyline….

EPA Testing Dangerous Pollutants on Human Beings

By Jen Alic, a geopolitical analyst, co-founder of ISA Intel (www.isaintel.com) in Sarajevo and the former editor-in-chief of ISN Security Watch in Zurich. Cross posted from OilPrice

Want to know how dangerous pollutants are to your health? For $12 an hour, you can find out directly.

Why Greece is a Model of Economic Mismanagement

By Delusional Economics, who is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.

Today I thought it was timely to have another look at the Greek economy from a sectoral balance perspective which will hopefully provide some clarity on exactly what we are seeing in Greece, but just as importantly also provide some broader context to the likely outcomes for other Eurozone periphery nations with similar economic dynamics.

Mortgage Settlement Monitor “Progress” Report Gooses Numbers to Hide Lack of Real Relief to Homeowners

Today, the settlement monitor Joseph Smith released another PR piece, um, progress report.

Quelle Surprise! New York Fed Chair Dudley Confirms that TBTF Lives, Big Firms Still Can’t Be Resolved

The New York Fed’s William Dudley gave a surprisingly candid, meaning not positive, assessment of the state of the Too Big to Fail problem in a speech yesterday at the Clearing House’s Second Annual Business Meeting and Conference. From the text of his speech (hat tip Richard Smith):

The Most Dangerous Choice for SEC Chairman

In a new column in the New York Times, Simon Johnson points out that Obama is likely to be appointing a new SEC chairman soon. He describes two alternatives: choosing a friend of the industry versus someone who might actually be willing and able to regulate it. Johnson believes that a tough-minded chairman should not only enforce the rules but “actively seek to change the conventional wisdom around finance.”

Quelle Surprise! HUD and Obama Whoppers About Mortgage Settlement, FHA Finances, Housing Market Remedies Coming Home to Roost

We took a very dim view of some of the Administration’s less-than-credible claims about its much-touted backdoor bank bailout, which was more popularly known as the mortgage settlement. And a rash of news reports tonight have caught the Administration out in its deceptions. From a March post, Memo to Shaun Donovan: Your Nose is Getting So Long You Need to Get a Hacksaw: