Nothin’ like having Uncle Sam cut an overly friendly deal. Plenty of folks, including yours truly, were skeptical of Treasury’s claim, made often with a straight face. that the government was exercising care on who got TARP funding (as in it was not just handing out dough willy-nilly, but did have an eye to getting […]
Read more...Submitted by Edward Harrison of Credit Writedowns. So, things are looking a lot brighter we are told by most economists and policy makers. The crisis is over and the banking system is on the mend. Now is the time for true reform and for bankers to get back to business as usual. While the foregoing […]
Read more...What amounted to a statement of principles and a very few stakes in the ground from Timothy Geithner on financial reform got a largely hostile reaction from Congress (see Ed Harrison here and here for further detail). The main criticism was that the notion of making the Fed the uber stability regulator/financial system overseer (officially, […]
Read more...Submitted by Edward Harrison of Credit Writedowns. If you listen to the criticism from the right and from the left, from pro-regulation and anti-regulation pundits, you can understand the political constraints which produced the white paper which the President unveiled yesterday. Given those constraints, I consider the white paper a good effort. My initial reaction, […]
Read more...Submitted by Edward Harrison of Credit Writedowns. Having read through the draft of President Obama’s financial regulatory proposal, my initial reaction is largely positive. He sets the right tone and says all of the right things. However, the devil is in the details and we will need to see how these firm up as these […]
Read more...Submitted by Edward Harrison of Credit Writedowns. This morning I was reading Simon Johnson’s excellent post “President Obama’s Regulatory Reforms Announcement: A Viewer’s Guide” about what Barack Obama should say when he makes his regulatory reform pitch today at 12:30 PM. I agree with what he has to say about the need to re-assure us […]
Read more...The Treasury Department’s plans for securitization reform are being bandied about in the press. A key question is whether it can or will fix the now-broken private securitization process. Credit became more dependent on securitization than many realize. By pretty much any metric, the role of banks relative to other players has declined since 1980, […]
Read more...Joe Nocera of the New York Times has a good piece today on the Obama executive pay proposals, such that they are. While I have sometimes been hard on Nocera for taking positions that I have found to be a bit too forgiving to the financial services industry, today he gave an articulate rendition of […]
Read more...Submitted by Edward Harrison of the site Credit Writedowns. “In many ways the effect of the crash on embezzlement was more significant than on suicide. To the economist embezzlement is the most interesting of crimes. Alone among the various forms of larceny it has a time parameter. Weeks, months, or years may elapse between the […]
Read more...Submitted by Edward Harrison of the site Credit Writedowns. The drama at Bank of America continues with Ken Lewis testifying before Congress today. Most of the events surround claims by Lewis that he was coerced into doing the Merrill deal by Hank Paulson and Ben Bernanke. I chronicled these events when they were made public […]
Read more...Submitted by Edward Harrison of the site Credit Writedowns. Yesterday, I argued that allowing banks to repay TARP funds meant a continuation of overcapacity in financial services, which was a direct contributor to the credit crisis through its dampening impact on unlevered returns. Some of the banks now free of the TARP restrictions are arguably […]
Read more...Submitted by Edward Harrison of the site Credit Writedowns. If you thought the bailout of too big to fail institutions was a massive gift from taxpayers to captains of Wall Street, the news that TARP funds are being repaid should confirm your beliefs. Just today the U.S. Treasury has agreed to allow 10 financial institutions […]
Read more...Readers have been sending various Pangloss/Orwell sightings on a daily basis, with one’s take on whether they fall in the absurdist or merely creeping authoritarian camp depending on one’s degree of cynicism. I have only posed about 1/10th of them simply because it often takes a fair bit of parsing (headline v. meaningful comment close […]
Read more...The Wall Street Journal has an eyepopping item tonight: The Federal Deposit Insurance Corp. is pushing for a shake-up of Citigroup Inc.’s top management, imperiling Chief Executive Vikram Pandit… The FDIC, under Chairman Sheila Bair, also recently pressed a fellow regulator to lower the government’s confidential ranking of Citi’s health — a change that would […]
Read more...Yesterday, we highlighted yet another indication that one of two parts of the infamous Public Private Investment Partnership, the so called Legacy Loans Program, was being delayed, possibly on a permanent basis (or more likely, it will be launched eventually to save bureaucratic face and have weak to non-existent take-up). Its evil twin, the program […]
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