Tag: "mortgage backed securities"

Purity, Obscurity and the Slaves of Defunct Economists

The Fed’s lending and the Treasury’s investments in banks will not cost taxpayers anything. Unfortunately, that can’t be said for the government’s stimulus program to create jobs. That is old fashioned government spending: Money spent, money gone. A large stimulus program was needed to cushion the recession and reduce job losses. But the program outsourced […]

Bailouts, Failures, and Death Panels

They are now making jokes about death panels — not to pull the plug on Grandma in the reformed health-care regime, but to pull the plug on banks and other large institutions posing risk in the reformed financial regime. Preventing failure doesn’t seem to be the goal. Triggering and punishing failure are the goals. The […]

Bankers: “charlatans and ne’er-do-wells”

My title is taken from the following quote from Monday’s (10-12-09) Dallas Morning News: “The financial services sector has enjoyed a fine summer rally, but I just can’t get too excited about a bunch of financial stocks leading the market higher. I mean, we are talking about banks, for heaven’s sake. These are the same […]

The Financial Crisis and Its Rhetoric

Guitar-picking virtuoso, Glen Campbell, was once asked, derisively I assume, if he could read music. He said he could read music, but not so much that it got in the way of his picking.  Not to suggest a comparison, but I'm pretty sure that if I'd ever taken a course in writing poetry, I'd never […]

Mark-to-Market, OTTI, Loan Loss Reserves, ETC.

"Accounting Arcana"    "It's fascinating that the not-so-tiny matter of a $30 billion loss comes down to accounting arcana, but it does." I copied that quote down last night when half asleep and this morning I can't recall where I got it. Now I can't find it. My best guess is the WSJ.com. My apologies […]

Stressing over Bank Stress Tests

If it weren't tacky to say I told you so, I'd refer you to my previous posts and interviews pointing out the dangers and pitfalls of the bank stress tests. They weren't just a mistake; they were a mistake anyone without sleep deprivation should have seen coming a mile away. It's not the biggest mistake […]

Well, Are the Banks Weak or Strong?

Good question. Many have received injections of capital (purchases of preferred stock) through the Troubled Asset Relief Program (TARP), yet many large banks announced large profits this week. If this week's announcements were all I knew about it, I'd be very confused. But, my answer is…

My Mark-to-Market Nightmare

I couldn't sleep at all last night. It started with a dream-nay, a nightmare-that I had taken a three-week vacation in a remote part of the world where cell phone reception was happily non existent. There were zero bars. It was a good vacation. I came home refreshed, full of vim and vigor, and ready […]

Guilt by Classification

We've all heard of guilt by association. I've recently come to realize that its first cousin is guilt by classification. The phenomenon isn't new to me, but the label is. It came to me last Sunday (December 14) while reading an article by Gretchen Morgenson in the New York Times. I admire her work very […]

The Fed’s Policy Easing

My quick reaction to the Fed’s shock and awe policy actions on Tuesday may be found at Forbes.com. Prior to the FOMC’s announcement, when the entire focus of expectations was on the target Fed Funds rate, I anticipated a reduction of 50 basis points, but I didn’t think it mattered much since the Fed Funds […]