Category Archives: Regulations and regulators

We Talk to CNNMoney About Geithner Plan, Bank Nationalization

Hope you enjoy this chat. Click here to view.

Bank Stress Testing: Less Than Meets the Eye

We are supposed to be impressed with the speed and scale of government action on the bank front. As reported in the New York Times: Nearly 100 federal banking regulators descended on Citigroup in New York on Wednesday morning. Dozens more fanned out through Bank of America, JPMorgan Chase and other big banks across the […]

Toxic Assets: Sellers Holding Out for Government Deal?

Even though Congress in general seems pretty clueless on matters financial (the Wall Street/high end variety), some members appear to understand the mindset. One consequence of the ever-delayed “buy the bad assets” program, which clearly has to pay at or above banks’ current marks (otherwise they show losses, which hurts their capital bases, something that […]

Geithner Plan Smackdown Wrap

I cannot recall a major US policy initiative being met with as much immediate revulsion as the so-called Geithner plan. Even the horrific TARP, which showed utter contempt for Congress and the American public was in some ways less troubling. Paulson demanded $700 billion, nearly $200 billion bigger than the Department of Defense, via a […]

Black Hole Alert: Fannie, Freddie Cash Needs May Exceed $200 Billion

The Freddie/Fannie conservatorship, which seemed like an epic event at the time, was succeeded by so many crises, Lehman, the September/October meltdowns, AIG, the European bank rescues, that it seems like a distant memory. But the Treasury made a commitment to maintain positive net worth for both the mortgage lenders/guarantors and was remarkably non-specific as […]

Geithner Bank Bailout Plan: Fiasco

That one word assessment of the Geithner plan, as previewed in the New York Times tonight, comes from reader Scott, and is good enough to print. I am so disgusted with this entire proceeding that I am going to dispatch it quickly. Let’s start with the basics. The US banking system is insolvent. Got that? […]

Now It’s Semi-Official: MLEC to Rise From the Dead

Remember the embarrassing ten weeks of so of Henry Paulson failing about to try to get his “get the bad assets out of the structured investment vehicles” effort, the MLEC, also fondly known as The Entity, off the ground? It quietly faded from the headlines.. Why? It was supposed to be a private sector solution, […]

Guest Post: "Dear Mr. Volcker: It’s the Banks, Stupid"

Guest blogger and former Congressional staffer Lune was kind enough to provide this post on Volcker’s testimony before the Senate Banking Committee today. Enjoy! From Lune: Paul Volcker, former Fed chief and currently the head of President Obama’s Economic Recovery Advisory Board, and the chairman of the Group of Thirty, testified to the Senate Banking […]

SEC Stonewalls at Senate Hearings on Madoff (and Congressional Fireworks!)

L’affaire Madoff gets more interesting by the day. I had though the failure to pursue the hedge fund scamster had more to do with incompetence and a disinclination to go after investment managers (insider trading cases, which is what seems to get the SEC’s enforcement division juices going, usually pick up penny ante players at […]

Obama’s Executive Comp Proposals: Closing the Gate After the Horse is in the Next County

I believe I am permitted to hyperventilate only once in an evening, so I’ll have to act with a modicum of restraint here. The Obama executive compensation restrictions for bailout fund recipients have been leaked, and may be long enough on appearances to appease an angry US electorate. But the shortcomings of the supposedly tough […]

The Bad Bank Assets Proposal: Even Worse Than You Imagined

Dear God, let’s just kiss the US economy goodbye. It may take a few years before the loyalists and permabulls throw in the towel, but the handwriting is on the wall. The Obama Administration, if the Washington Post’s latest report is accurate, is about to embark on a hugely expensive “save the banking industry at […]

"The Rise and Fall of the US Mortgage and Credit Markets"

The Milken Institute has released a new report on the housing/credit crisis, which is a preview of a book to be released this spring (hat tip reader Dwight). What I found particularly interesting, given the Institute’s conservative leanings, is that the policy recommendations were on the whole, middle of the road. They acknowledged the need […]

Sentence First, Verdict Afterwards on TARP?

Maybe I am reading too much into this development, but the fact that Team Obama is planning to announce some TARP restrictions prior to revealing how the money will be doled out is really odd. I welcome other views, but I can come up with only three theories: 1. The Administration is waking up to […]

John Paulson Attacks Fellow Hedge Funds for Restricting Redemptions (and Implications for Banks)

This is starting to get interesting. Readers may recall that a fair number of hedge funds have restricted or barred redemptions (a classic example of “possession is 9/10 of the law” since it is contrary to the redemption policies in their investment agreements). The justification goes something like this: We the fund hold liquid and […]