New Deal 2.0 Tue 2009-11-03 20:07 EST

Roosevelt Institute Director and Senior Fellow Rob Johnson will lead Soros' $50 Million Effort

Rob Johnson, Director of the Economic Policy Initiative of the Roosevelt Institute, has been pegged to lead financier George Soros' $50 million effort to create an ``Institute for New Economic Thinking'', which will fund research, convene symposiums, and establish a journal -- all in the name of promoting free market skeptics and creating a new economic paradigm. To this end Soros is gathering market-skeptics this week, including Roosevelt Institute Braintruster and Nobel Prize-winner Joseph Stiglitz, George Akerlof, Michael Spence, and Sir James Mirrlees to start the conversation. ``Economics has failed not only to predict and explain what happened but has also failed to protect society,'' said Johnson in an article in Newsweek. ``That's what the crisis revealed. The paradigm has failed. There is no guidance.''

0; 50; effort; lead Soros; new dealing 2; Roosevelt Institute Director; Senior Fellow Rob Johnson.

zero hedge Tue 2009-11-03 19:57 EST

Guest Post: Systemic Risk is All About Innovation and Incentives: Ed Kane

Edward J. Kane vi Chris Whalen

...we present the views of our friend and mentor Ed Kane of Boston College, who argues that the problem with the financial regulatory framework is not the law, regulation nor even the regulators, but rather the confluence of poorly aligned incentives and financial innovation... The financial crisis of 2007-2009 is the product of a regulation-induced short-cutting and near elimination of private counterparty incentives to perform adequate due diligence along the chain of transactions traversed in securitizing and re-securitizing risky loans (Kane, 2009a). The GLBA [Gramm-Leach-Bliley Financial Modernization Act of 1999] did make it easier for institutions to make themselves more difficult to fail and unwind. But it did not cause due-diligence incentives to break down in lending and securitization, nor did it cause borrowers and lenders to overleverage themselves. Still, the three phenomena share a common cause. Excessive risk-taking, regulation-induced innovation, and the lobbying pressure that led to the GLBA trace to subsidies to risk-taking that are protected by the political and economic challenges of monitoring and policing the safety-net consequences of regulation-induced innovation. These challenges and the limited liability that their stockholders and counterparties enjoy make it easy for clever managers of large institutions to extract implicit subsidies to leveraged risk-taking from national safety nets (Kane, 2009b)...To reduce the threat of future crises, the pressing task is not to rework bureaucratic patterns of financial regulation, but to repair defects in the incentive structure under which private and government supervisors manage a nation's financial safety net.

Ed Kane; Guest Post; incentives; innovation; systemic risk; Zero Hedge.

The Guardian World News Thu 2009-10-22 14:20 EDT

Bear Stearns duo 'lied over and over'

A pair of maverick Bear Stearns hedge fund managers lied to clients "over and over again" to protect their multimillion dollar pay cheques, exchanging secret emails to orchestrate a $1.6bn fraud as their funds imploded in the global financial crisis, a US jury heard yesterday. At a federal court in the New York borough of Brooklyn, financiers Ralph Cioffi and Matthew Tannin became the first Wall Street bankers to stand trial in a criminal case arising from the credit crunch.

Bear Stearns duo; Guardian World News; lying.

TraderFeed Sat 2009-10-10 13:48 EDT

Quick Look at TIPS and Beyond

Brett Steenbarger, Ph.D.

U.S. Treasury Inflation-Protected Securities (TIP; above) are making multi-month highs, amidst the weak dollar and strong gold. I've noticed a tick up in inflation talk among traders as well. With unemployment--not inflation--making the headlines, the Fed hardly has the political cover to begin serious talk of rate increases. With the Reserve Bank of Australia hiking rates, however, there are concerns that we are just a bit closer to the long-awaited exit from monetary ease. Meanwhile, higher Aussie rates only fuel the carry trade that has traders selling U.S. dollars and finding higher yielding alternatives elsewhere.

quick look; tip; TraderFeed.

Tue 2009-09-29 11:39 EDT

The Health Care Deceit

Paul Craig Roberts, CounterPunch

...The health care bill is not about health care. It is about protecting and increasing the profits of the insurance companies. The main feature of the health care bill is the ``individual mandate,'' which requires everyone in America to buy health insurance. Senate Finance Committee chairman Max Baucus (D-Mont), a recipient of millions in contributions over his career from the insurance industry, proposes to impose up to a $3,800 fine on Americans who fail to purchase health insurance...The telltale part of Obama's speech was the applause in response to his pledge that ``I will not sign a plan that adds one dime to our deficits.'' Yet, Obama and his fellow politicians have no hesitation to add trillions of dollars to the deficit in order to fund wars...t was the war in Afghanistan, not health care, that President Obama declared to be a ``necessity.''

Health Care Deceit.

Satyajit Das's Blog - Fear & Loathing in Financial Products Tue 2009-04-21 00:00 EDT

Satyajit Das's Blog - Fear & Loathing in Financial Products: Credit Default Swaps -- Exercises in Surrealism

Satyajit Das's Blog - Fear & Loathing in Financial Products: Credit Default Swaps - Exercises in Surrealism; CDS payouts are placing a material pressure on the price of underlying bonds and loans exacerbating broader credit problems ``The CDS market is also complicating restructuring of distressed loans as all lenders do not have the same interest in ensuring the survival of the firm. A lender with purchased protection may seek to use the restructuring to trigger its CDS contracts''

Credit Default Swap; exercised; fears; financial products; loath; Satyajit Das's Blog; surreal.

Fri 2009-01-16 00:00 EST

Buying Inflation Protected Treasuries - iShares TIP ETF And SellDirect

Buying Inflation Protected Treasuries - iShares TIP ETF And SellDirect For Treasury Inflation Protected Securities

Buying Inflation Protected Treasuries; iShares TIP ETF; SellDirect.

Fri 2009-01-16 00:00 EST

U.S. Treasury Inflation-Protected Securities (TIPS)

tip; U.S. Treasury Inflation-Protected Securities.

Fri 2009-01-16 00:00 EST

The Savings Investor: All About TIPS (Treasury Inflation Protected Securities)

Saving Investors; tip; Treasury INFLATE protect Securities.

Tue 2008-07-22 00:00 EDT

Individual - Legacy Treasury Direct®

Legacy Treasury Direct® -- buy Treasury bills, Treasury notes, and Treasury Inflation-Protected Securities (TIPS) directly from the U.S. Treasury, without a broker.

individual; Legacy Treasury Direct®.

Sat 2008-05-24 00:00 EDT

Jesse's Café Américain: Silver Price Manipulation through 'Naked Shorting'

Jesse's Café Américain: Silver Price Manipulation through 'Naked Shorting'; CFTC protecting silver short interest; crony capitialism corrupting public markets

Jesse's Café Américain; Naked Short; Silver Price Manipulation.

Tue 2008-05-13 00:00 EDT

FBI Targets Internet Archive With Secret 'National Security Letter', Loses | Threat Level from Wired.com

FBI Targets Internet Archive With Secret 'National Security Letter', Loses, by Ryan Singal | Threat Level from Wired.com; Internet Archive; Brewster Kahle; EFF defeats NSL; "time-honored tradition of librarians protecting the rights of their patrons"

com; FBI Targets Internet Archive; Lose; nation security letter; secret; Threat Level; Wired.

Mon 2008-03-31 00:00 EDT

Hussman Funds - Weekly Market Comment: What Congress and Investors Should Understand About the Bear Stearns Deal - March 31, 2008

"Protecting the bondholders of investment banks is not an efficient way to help homeowners."

2008; Bear Stearns Deal; Congress; Hussman Funds; Investors; March 31; understanding; weekly market comments.

Sun 2007-12-23 00:00 EST

Bear In Mind > Was George Stephanopoulos lying about the PPT?

Bear In Mind > Was George Stephanopoulos lying about the PPT? plunge protection team created by Fed in 1989; cf. Sprott "The Visible Hand" pdf

Bear; George Stephanopoulos lying; mind; PPT.

Wed 2007-12-05 00:00 EST

Mish's Global Economic Trend Analysis: More Banks Abandon Paulson's Super-SIV Plan

"Is protection of Citigroup itself the only reason left for the Super-SIV?"

Banks Abandon Paulson's Super-SIV Plan; Mish's Global Economic Trend Analysis.

Tue 2006-11-28 00:00 EST

Washington Post

Science a la Joe Camel, by Laurie David; National Science Teacher Association declines "An Inconvenient Truth" to protect oil industry funding

Washington Post.