TODAY, we learn that Abu Dhabi will provide $10 billion in support to Dubai, to help it resolve the debt problems [...]
Working in Washington 12/11/2009
The Congressional Budget Office is expected to release its analysis of the Senate’s health-care compromise, with Democrats looking for a vote before the end of the year. There’s also a number of tech companies reporting earnings. Stacey Delo reports.
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Asia’s Week Ahead: Central Banks in Action 12/11/2009
Traders will [...]
It is Doug French who first pointed out the obvious to me: It is not "Interest Rates Are Low, but Banks Balk at Refinancing" but rather "Interest Rates Are Low, and Therefore Banks Balk at Refinancing."
Part of the problem with Bailouts are they prop up bad banks, and push aside those without the competitive advantage of taxpayer monies.
This chart shows exactly how concentrated the current state of deposits are at US banks:
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Market Share of 4 Biggest US Banks Since 1998Why do Americans owe less money this year?
Floyd Norris zeros in one one of the factors: Banks writing down uncollectable debts:
“Figures released this week by the Federal Reserve showed that Americans owed $10.8 trillion on home mortgages at the end of the third quarter, down 2.2 percent from a [...]
The WSJ has new details on how banks would pass CDO risk between each other in an improbably long chain:
One of Goldman's trades with AIG involved a financial vehicle called South Coast Funding VIII. South Coast was one of many pools of bonds backed by individual homeowners' mortgage payments' [...]
FELIX SALMON describes the future of personal banking:
Yodlee is the engine behind the online banking operations of most banks in [...]
Big banks have benefited from TARP funds, but those benefits are not trickling down to the real economy, Elizabeth Warren, chairman of the Congressional Oversight Panel, told CNBC.
Airtime: Wed. Dec. 9 2009 | 8:35 AM ET
My colleague Peter Thal Larsen has an interesting take on the numbers associated with the UK banker supertax, and how a 50% tax on a £6 billion bonus pool can generate only £550 million in revenue:
The government’s estimate assumes that banks will reduce their bonuses. It is also a [...]
With the government, the opposition and the media all heavily engaged in gratuitous bank-bashing, few people have given much attention to the implications of tighter capital adequacy regulation for the cost of borrowing to consumers. RBA Governor Glenn Stevens was remarkably frank about [...]
Alistair Darling, the UK Chancellor of the Exchequer, announced today that banks either had to use their profits to rebuild capital, or face a 50% tax on bonuses of more than GBP25,000. The Wall Street Journal reports:
Alistair Darling, delivering his pre-Budget report speech this afternoon, [...]
This chart comes from the Congressional Oversight Panel's latest report, and it's pretty self-explanatory. Here's the COP's gloss:
Bank consolidation has worrisome implications for moral hazard, as long as there continues to be a perception in the market of an implicit guarantee. As a small number of [...]
Drastic times call for drastic measures. The current crisis has brought global central banks to their knees. Interest rates have been lowered to zero, or nearly so, in a concerted attempt to stimulate investment and consumption spending. The effect has been minimal.
While quantitative easing - the method central bankers employ [...]
To nobody's surprise, bankers are complaining about the UK's 50% supertax on their bonuses this year:
The government hopes the move will encourage banks to use additional cash to shore up their capital bases, rather than pay high salaries. But banking groups have warned that penalizing high earners in the [...]
Lucian Bebchuk, Alma Cohen, and Holger Spamann explain how executive pay at investment banks helped precipitate the crisis:
Our analysis undermines the claims that executives’ losses on shares during the collapses establish that they did not have incentives to take excessive risks. The fact that the executives did not sell [...]
The WSJ reports there are as many as 600-700 foreclosure auctions each weekday in Phoenix.
"'The banks are so screwed up,' says Mr. Mirmelli, the Phoenix investor, that they don't always have a clear idea of the value of the property they are foreclosing on."
' [...]PERHAPS you've noticed that being too-big-to-fail comes with some fairly significant benefits. Notably, you can't be allowed [...]
Buying homes at foreclosure auctions is not for the faint of heart, and James Hagerty's WSJ article today does a good job of explaining many of the potential pitfalls — up to and including finding concrete poured down the toilet. But what really puzzles me is the degree to' [...]
So, all's well that ends well, right? The government's making an $18 billion profit on its TARP bailout, or at least that part of it which went to the banks. (Never mind the $30 billion in losses on the money that went to AIG.) Kuwait has made $1.1 [...]
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