Rolfe Winkler has an useful sighting on a wrinkle in the Ambac receivership. A big bone of contention has been the credit default swaps that Ambac wrote on various structured credit transactions. While many of the contracts provided for considerably delayed payment (they were different in this regard from AIG’s CDS), as Ambac’s condition worsened, […]
Read more...Independent Strategy’s latest report, “China’s credit bubble: the missing piece in the jigsaw” makes a persuasive case that China’s debt fueled growth model is due for a hard landing, but the timing is uncertain, since the debt is funded internally. China is barely past an episode of dealing with banks chock full of bad loans […]
Read more...Enjoy! Below is a related discussion by Ann Rutledge of R&R Consulting, another structured credit expert:
Read more...Rampant fraud in the mortgage industry has increased so sharply that the FBI warned Friday of an "epidemic" of financial crimes which, if not curtailed, could become "the next S&L crisis." Assistant FBI Director Chris Swecker said the booming mortgage market, fueled by low interest rates and soaring home values, has attracted unscrupulous professionals and […]
Read more...By Richard Alford, a former economist at the New York Fed. Since then, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. Wide swaths of families, businesses, investors, taxpayers, and others have had not just their net worth but their lives […]
Read more...By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. Arthur Conan Doyle’s literary creation, Sherlock Holmes, once solved a murder by noting the dog that didn’t bark. It doesn’t take Holmes’s ingenuity to see that the plan on offer for Greece is clearly a rescue package which doesn’t rescue. […]
Read more...The Financial Times reports that the SEC has launched a probe into whether other financial firms used repos to engage in what amounted to financial fraud (as in fraudulent financial reporting), although perilous few are using the “F” word. From the Financial Times: US regulators on Monday asked more than 20 financial groups whether they […]
Read more...The EU seems unintimidated by various threats the hedge fund and private equity fund industry have tried to make to forestall efforts to restrict the activities of those firms. The EU proposed both limiting the ability of EU nationals to invest in non-EU funds, and the ability of non-EU players to operate within the EU. […]
Read more...Economists are often in the “it works in practice, but does it work in theory?” mode, but here we see a case where some are grappling with why some of their prized notions pre-crisis came a cropper. A clever post at VoxEU discusses why financial innovation isn’t what it is cracked up to be, and […]
Read more...By Eliot Spitzer, former governor of New York who blogs for Slate.com and guest posts on New Deal 2.0, and Josh Rosner, the managing director of an independent financial services research firm It doesn’t take a rocket scientist — and certainly not an accountant — to deduce one thing from the Lehman scandal. The misleading […]
Read more...The so-called Valukas report on the Lehman bankruptcy has put a harsh light on the final months of the floundering firm and the regulators who stepped up their oversight, in particular, the New York Fed. Some of the NY Fed’s moves have been so indefensible as to in and of themselves warrant full bore investigation. […]
Read more...An interesting right/left conversation. It’s refreshing to see reasoned discussion across ideological lines.
Read more...A story in China Daily indicates that the Chinese offiicaldom foresees a record trade deficit for March: The country will probably see a “record trade deficit” in March thanks to surging imports, Minister of Commerce Chen Deming said on Sunday, while warning that Beijing will “fight back” if Washington labels China a currency manipulator. Speaking […]
Read more...The widely-extolled idea, that the EU would find a way to muddle through the Greece crisis, looks very much in doubt. The pressure has not simply put the rescue of Greece into disarray, but appears to have led to some positions being taken that, if they hold, could lead to the partial dissolution of the […]
Read more...Via an e-mail from someone who has worked at the SEC. Note that the reason for the mention of the Department of Justice is that the SEC cannot bring criminal cases on its own, but has to secure the cooperation of the DoJ. The SEC-DoJ relationship is not entirely functional, but I suspect that the […]
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