Category Archives: regulation

Rogue Brokers: Finra Asleep at the Wheel

Posted on October 23, 2007 by Felix

Megan Barnett has the interesting tale of Karen McKinley, a rogue Merrill Lynch broker in Florida. McKinley had a habit of working to maximize her own commissions rather than investing her clients’ funds in suitable investments; indeed, even after one … Continue reading →

Posted in law, regulation | 1 Comment

Nasdaq is not a Strategic Asset

Posted on September 21, 2007 by Felix

Matt Cooper today describes a 19.9% stake in the Nasdaq stock exchange as a "strategic US asset" – going even further than Chuck Schumer, the only lawmaker who seems to have any concerns about the deal at all, who said … Continue reading →

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Banks’ Capital in the Era of Re-Intermediation

Posted on September 14, 2007 by Felix

Charles Goodhart says in the FT today that there’s loads of money sloshing around the banking system; what’s missing is not liquidity, but capital. He explains: Just as the central bank is lender of last resort to banks, so banks … Continue reading →

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Australia: Ahead of the Regulatory Curve

Posted on September 10, 2007 by Felix

Which country is most ahead of the regulatory curve these days? A couple of
recent developments suggest that it might be Australia.
Continue reading →

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Nostalgia for Glass Steagall

Posted on September 7, 2007 by Felix

Yves Smith at Naked Capitalism submits: Boy, is sentiment changing. The latest indicator: an article in MarketWatch bemoaning the demise of Glass Steagall, the law enacted in 1933 that separated commercial banking from investment banking. The article by Thomas Kostigen … Continue reading →

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Extreme Measures III: Cambiz Alikhani at the Financial Times

Posted on September 6, 2007 by Felix

Yves Smith of Naked Capitalism submits: As concern about tightening conditions in the credit markets and the continued erosion of the US supbrime and broader housing market has grown, so too have calls for Extreme Measures to combat these snowballing … Continue reading →

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Will Asking Mortgage Servicers to Modify Mortgages Have Much Impact?

Posted on September 4, 2007 by Felix

Yves Smith at Naked Capitalism submits: Bloomberg tells us that the Fed and the Treasury made a joint statement today asking mortgage servicers to take a more proactive stance, identify borrowers in danger of gong into default, and offer loan … Continue reading →

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Bundesbank President Weber vs. White House on Housing Crisis

Posted on September 3, 2007 by Felix

Yves Smith at Naked Capitalism submits: Apologies for the heavy reliance on the Financial Times today, but the pickings elsewhere are meager indeed. The FT has an interesting juxtaposition of stores on its website tonight. The lead story, from the … Continue reading →

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AAA to CCC and Other Rating Agency Horror Stories

Posted on August 31, 2007 by Felix

Yves Smith at Naked Capitalism submits: The news from rating agency land goes from bad to worse. This Bloomberg article does much to explain why investors are avoiding subprime like the plague. AAA paper revealed to be CCC. Repeated incidents … Continue reading →

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Commercial Paper Market Still in Distress

Posted on August 30, 2007 by Felix

Yves Smith at Naked Capitalism submits: Bloomberg tells us that the commercial paper market is shrinking rapidly. This is a more serious issue than might appear. Commercial paper is an important, if not the most important, source of short-term funding … Continue reading →

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The WSJ’s Greg Ip Defends Bernanke Against Martin Wolf

Posted on August 30, 2007 by Felix

Yves Smith at Naked Capitalism submits: Frankly, this is pathetic. If Bernanke and his minions can’t take the heat of some well-deserved criticism from the highly-regarded Martin Wolf of the Financial Times, they don’t belong in public service. To recap: … Continue reading →

Posted in Media, Politics, regulation | 4 Comments

How Greenspan Diminished the Fed

Posted on August 30, 2007 by Felix

Yves Smith at Naked Capitalism submits: It must be miserable to be a central banker these days. Not only are they confronted with the worst mess in at least a generation, but too many interested parties, from the financial services … Continue reading →

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New Business Opportunity: SMS Loan Sharking

Posted on August 29, 2007 by Felix

Yves Smith at Naked Capitalism submits: Lucy Kellaway, a Financial Times columnist who writes about corporate fads, once said no new business technique is too ridiculous to be put into practice. The Springwise newsletter (“New business ideas for entrepreneurial minds”), … Continue reading →

Posted in banking, bonds and loans, personal finance, regulation | 1 Comment

Martin Wolf Takes Bernanke to the Woodshed

Posted on August 29, 2007 by Felix

Yves Smith at Naked Capitalism submits: Oh, I do so enjoy it when the Financial Times’ chief economics editor, the normally measured and thoughtful Martin Wolf, works himself into a lather. Wolf blasts what he reads as the Fed’s vow … Continue reading →

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Foreigners Demanding a Say in US Market Regulation

Posted on August 29, 2007 by Felix

Yves Smith at Naked Capitalism submits: Some reformers have argued that we are at the end of a regulatory paradigm and need to consider fundamental change in securities laws. It turns out some foreign regulators are already making that case. … Continue reading →

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Larry Summers’ Unanswered Questions

Posted on August 27, 2007 by Felix

Yves Smith at Naked Capitalism submits: Today, in a comment at the Financial Times, “This is where Freddie and Fannie step in” (subscription required), Harvard’s Larry Summers argued that the subprime crisis highlights three questions. Most commentators focused on the … Continue reading →

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Extreme Measures II: Gillian Tett at the Financial Times

Posted on August 27, 2007 by Felix

Yves Smith at Naked Capitalism submits: Recently, we’ve noticed a new theme among economics writers: Extreme Measures. Commentators have looked toward the end of the road we are on and fear it leads to a precipice. Hence the calls for … Continue reading →

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Willem Buiter on How Central Bankers Are Co-Opted

Posted on August 26, 2007 by Felix

Yves Smith of Naked Capitalism submits: A reader pointed me to Willem Buiter’s blog, and it is a real find. For those who haven’t heard about him, he (along with Anne Siber) has proposed a rethinking of central bankers’ roles … Continue reading →

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Extreme Measures I: Bill Gross at Pimco

Posted on August 26, 2007 by Felix

Yves Smith of Naked Capitalism submits: We’ve noticed a new theme among economics writers: Extreme Measures. Commentators have suddenly looked into the abyss, either of the depth of the US subprime/housing problem or the progressing credit crunch that has already … Continue reading →

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Fed Acts More Directly to Shore Up Battered Asset-Backed Commercial Paper Market

Posted on August 24, 2007 by Felix

Yves Smith at Naked Capitalism submits: To recap the turmoil in the money markets: the problem stems from a near-complete repudiation of asset-backed commercial paper, which constitutes roughly half of commercial paper outstandings. The reason for the concern is most … Continue reading →

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Thinking the Unthinkable: Regulating the Brave New World of Finance

Posted on August 24, 2007 by Felix

Yves Smith at Naked Capitalism submits: Earlier this week, I sought to frame the prevailing views of what the supervising adults, namely central bankers, should do about the turmoil in the financial markets. They break down into four groups (names … Continue reading →

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Central Bank Efforts to Stabilize Money Markets May Not Be Working

Posted on August 23, 2007 by Felix

Yves Smith of Naked Capitalism submits: An update from Bloomberg tells us that commercial paper outstandings fell 4.2% in a week, which suggests the efforts of central bankers to restore confidence in that market, and particularly in asset backed commercial … Continue reading →

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Do-It-Yourself Dubious Accounting

Posted on August 23, 2007 by Felix

Yves Smith at Naked Capitalism reports: Part of the hangover that followed the dot-com bubble was rampant accounting fraud. Before then, accounting chicanery was virtually unheard of in Fortune 500 companies. It instead cropped up at high fliers with loose … Continue reading →

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The Financial Times’ Martin Wolf Defends the Fed

Posted on August 22, 2007 by Felix

Yves Smith of Naked Capitalism submits: Normally, I have the highest regard for Martin Wolf, the Financial Times’ lead economics writer. He is forthright, data-driven, articulate, and insightful. However, I take issue with his current article, “The Federal Reserve must … Continue reading →

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Has Smoke and Mirrors Worked?

Posted on August 21, 2007 by Felix

Yves Smith at Naked Capitalism submits: In an inspired bit of stagecraft, Senate Banking Committee Chairman Christopher Dodd reported today on a meeting with Fed chairman Ben Bernanke and Treasury secretary Henry Paulson that the Fed stood ready to use … Continue reading →

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