CFR staff writer Roya Wolverson with a terrific overview of the debate.
Debating a New Role for the Fed
Author: Roya Wolverson, Staff Writer
Introduction
Debating a New Role for the Fed
December 21, 2009 By Leave a Comment
Readings on Financial Regulatory Reform
December 20, 2009 By Leave a Comment
When the author of Principles of Economics suggests some weekend reading, you will rarely be disappointed.
Readings on Financial Regulatory Reform
By Greg Mankiw
Too Much Spitzer, Not Enough AIG
December 19, 2009 By Leave a Comment
As a New Yorker I still cringe at details of Gov. Spitzer’s fall from grace, tidbits I wish I could forget. This doesn’t take away from his fundamental arguments with William Black though.
We know too much about Spitzer, not nearly enough about what really happened at AIG.
Show Us the E-Mail
By ELIOT SPITZER, FRANK PARTNOY and WILLIAM BLACK || NYTimes.comWE end this extraordinary financial year with news that the Treasury is in discussions with American International Group about selling the taxpayers’ 80 percent ownership stake in that company. The government recently permitted several banks to break free of its potential oversight by repaying loans made during the rescue. But with respect to A.I.G., the Treasury should not move so fast. There is one job left to do.
“It’s Certainly Not For A Lack Of Effort”
December 19, 2009 By Leave a Comment
The hubris case against bank CEOs has been made before in several flavors but the gist is always straightforward — essentially, proponents argue that bank CEOs haven’t shown nearly sufficient respect for responding to the President given circumstances. It’s hard to imagine there’s not at least some truth, and this is POTUS we’re talking about.
That said, circumstantial evidence doesn’t necessarily prove ill intent, it only implies it. I agree with Simon this was impolite to the maximum but I’m not as certain it will be anyone’s undoing (at least in the short term).
FDIC Busy Bees
December 19, 2009 By Leave a Comment
Mish commentary on bank failures:
Seven Banks Fail, 140 YTD total, Sheila Bair “prepared to handle an ever-larger number of bank failures next year”
A total of 140 banks have failed year to date and FDIC Chairman Sheila Bair is adding staff, prepared for even more failures next year.
Please consider Seven U.S. Banks Are Seized, Raising Year’s Failure Toll to 140
Seven U.S. banks were seized by regulators today, bringing this year’s total of failed lenders to 140 as financial companies are tested by the recession and the Federal Deposit Insurance Corp. anticipates more shutdowns.
Paul Volcker Picks Up a Bat
December 17, 2009 By Leave a Comment
Volcker may not have the most prominent position in government these days, but it’s good to see another perspective in the debate at his level — hopefully our policy will come out more effectively as a result, whichever direction it takes.
Paul Volcker Picks Up A Bat
For most the past 12 months, Paul Volcker was sitting on the policy sidelines. He had impressive sounding job titles – member of President Obama’s Transition Economic Advisory Board immediately after last November’s election, and quickly named to head the new Economic Recovery Board.
Volcker: “Wake Up, Gentlemen”
December 15, 2009 By Leave a Comment
Volcker has made a lot of splash recently, including his questioning whether financial innovation has improved society much since the ATM. This may or may not have been hyperbole on his part (the High Yield bond market led to some good innovations, for one), but it seems clear that he is indeed moving the ball along a different direction.
“Wake Up, Gentlemen”
The guiding myth underpinning the reconstruction of our dangerous banking system is: Financial innovation as-we-know-it is valuable and must be preserved. Anyone opposed to this approach is a populist, with or without a pitchfork.
FDIC Playing a Dangerous Game
December 14, 2009 By Leave a Comment
Government may need to think outside the box to get the kind of lending they want going again, hopefully without leaving the punch-bowl out too long. Fiscal stimulus can at least be more focused than a monetary one — quantitative easing can’t last forever.
Where does politics end and prudence begin?
Sheila Bair Begs For More Bank Failures
One might think that 159 bank failures in the last two years would be the primary concern to Sheila Bair.
Unfortunately, that is not the case as noted by Bloomberg in FDIC’s Bair Concerned Banks Making Only ‘Safest Loans,’ Urges More Lending
Congress and Swiss Cheese Legislation
December 10, 2009 By Leave a Comment
Lobbying has long been a sore point for politics and unfortunately the activity does reflect a conflicting agenda vis-à-vis taxpayers on occasion. This is probably one of those times.
OTC derivatives are ground zero that led to the cascading bilateral counterparty collapse of 2008.
$344 Million Buys A Lot Of Loopholes
The world financial system nearly melted down in 2008. This was a result of the interlocking web of exposures between major financial institutions caused by the unregulated and completely opaque over-the-counter (OTC) derivatives market. The U.S. taxpayer was forced to pledge nearly $24 trillion in cash and loan guarantees to avert financial Armageddon. That amounts to approximately $200,000 for every household in America!
Game Theory in Polifinance
November 29, 2009 By Leave a Comment
Is the financial services industry a zero-sum game?
“Can’t Get Enough: Goldman’s Profit is Citi’s Pain?”
By Thomas Adams, at Paykin Krieg and Adams, LLP, and a former managing director at Ambac and FGIC.
Many thanks for the thoughtful comments on my earlier post. If you can take a little more on the subject, I thought I would add some clarification to some of the issues raised.
First, on the merits of a monoline vs. AIG bailout, consider a case of counterparty compare and contrast, using Goldman Sachs and Citigroup as examples.
Nitpicking a Fed Chairman
November 29, 2009 By Leave a Comment
Yves is terrific to read when she gets rolling — I’m not against Bernanke but I must admit:
- that he even felt compelled to write an op-ed is remarkable (Fed Chairmen historically do not do this), and
- he does lay it on a wee bit thick.
Bernanke Tries to Defend the Fed
In a sign that the Federal Reserve is circling the wagons, chairman Ben Bernanke has an op-ed in the Washington Post that attempts to defend the central bank’s role. What is interesting is how much the tables have turned. The Obama effort to make the Fed into the uber bank regulator has become a rout, with decent odds that the Fed will have its powers reduced, and an increasing possibility that Bernanke might not be reconfirmed (which is frankly the right outcome, no CEO who presided over a similar disaster would still be in charge).
More Compelling Than a “Vampire Squid”
November 24, 2009 By 1 Comment
I’m not all that into the vampire squid meme, but well supported arguments deserve attention in the arena of government influence. Clearly, evidence supports that Goldman is very good to their shareholders and employees. In my mind, this means they’re upholding their side of fiduciary responsibility.
If there is a problem embedded here (and likely there is), then responsibility should ultimately rest with our elected leaders.
Goldman/AIG Conspiracy Theories: There’s a Reason They Won’t Go Away
Note: this post is by Thomas Adams, at Paykin Krieg and Adams, LLP, and a former managing director at Ambac and FGIC, with some minor additions by yours truly. This is a significant piece of some puzzles he, some other experts who prefer to remain anonymous, and I have been pushing on for several months.
Jason Paez (