RollingStone.com: Matt Taibbi | Taibblog Thu 2010-09-23 09:37 EDT

Bob Rubin Cuddles

Matt Taibbi

...No man's behavior looks attractive when he's cheating on his wife, but this little tell-all by a woman who had a sort-of fling with former Goldman chief and Treasury Secretary Bob Rubin is more than unusually embarrassing...The most disgusting (and revealing) part of the story is, to me, this part of Iris Mack's narrative... A multi-multi-millionaire giving a homeless guy a dollar on the way to the Ritz...if that isn't the perfect metaphor for the modern ``Third Way'' Democratic Party, I don't know what is...Bob Rubin's main job at Citi was to hang around and be available for his political connections. His job, as I understand it, was a sort of permanent, ongoing bribe...

Bob Rubin cuddle; com; Matt Taibbi; rollingstone; Taibblog.

Rajiv Sethi Mon 2010-09-20 10:04 EDT

An Extreme Version of a Routine Event

Rajiv

The flash crash of May 6 has generally been viewed as a pathological event, unprecedented in history and unlikely to be repeated in the foreseeable future...far from being a pathological event, the flash crash was simply a very extreme version of a relatively routine occurrence...the flash crash can provide us with insights into the more general dynamics of prices in speculative asset markets...The crash revealed with incredible clarity how (as James Tobin observed a long time ago) markets can satisfy information arbitrage efficiency while failing to satisfy fundamental valuation efficiency...Aside from scale and speed, one major difference between the flash crash and its more routine predecessors was the unprecedented cancellation of trades...this was a mistake: losses from trading provide the only mechanism that currently keeps the proliferation of destabilizing strategies in check...

extreme version; Rajiv Sethi; routine event.

Tue 2010-08-24 20:09 EDT

EconomicPolicyJournal.com: Is China Executing a Cunning Sun Tzu Strategy to Destroy the Dollar and Cause an Upward Price Explosion in Gold?

Elizabeth Brinsden

Could China be coveting the role of the next economic superpower, thereby supplanting the USA? If so, is China planning to do this by design or is it simply awaiting this result by default as a result of the total collapse of the American economic system?...At a superficial level, it may appear to the onlooker that China has been sucked into a giant malinvestment by purchasing these bonds, but a closer look at Master Sun's stratagems may reveal a well conceived and even cunning plan...China may well be heading in the direction of pegging its currency in some form to something else and that that something else, is very likely to be gold. Then China could offload its US bonds by sale , once again raising the price of gold dramatically which in turn would compensate for the dollar losses...Not only would this give China the only trustworthy currency in the world, but it would simultaneously and conveniently constitute the knock-out blow to the USA as the economic superpower...

caused; China executive; com; Cunning Sun Tzu Strategy; destroyed; Dollar; EconomicPolicyJournal; gold; Upward Price Explosion.

zero hedge - on a long enough timeline, the survival rate for everyone drops to zero Fri 2010-07-30 15:41 EDT

China Has Been Covertly Funding A Housing Bubble Five Times Larger Than That Of The US: 65 Million Vacant Homes Uncovered

...a report [Fitch] released today titled Informal Securitisation Increasingly Distorting Credit Data, uncovers that China has in fact been massively underrepresenting the actual amount of new loans in the first half of 2010, courtesy of precisely the kinds of securitization deals that blew up half of our own banking system... [moreover, Yi Xianrong,] an economist at the Chinese Academy of Social Sciences noted estimates from electricity meter readings that there are about 64.5 million empty apartments and houses in urban areas of the country... China's banks are increasingly becoming more opaque in data presentation, which one can assume is due to their unwillingness to reveal the true state of affairs... [According to] Xianrong ``investment in the domestic property market has completely overturned China's traditional concepts of wealth management and investment and its price formation system'' [Chinese real estate bubble]

65; China; covert funding; dropped; housing bubble; long; survival rate; Time larger; Timeline; Vacant Homes Uncovered; zero; Zero Hedge.

THE PRAGMATIC CAPITALIST Wed 2010-04-07 18:22 EDT

THE ENRON BANKING SYSTEM

TPC

``Panics do not destroy capital -- they merely reveal the extent to which it has previously been destroyed by its betrayal in hopelessly unproductive works'' -- John Mills ...We should draw a distinct line in the sand between banks and diverse risk taking firms. There are always going to be Enron's in the economy, but why should we allow our entire banking sector to mirror Enron? Taking a 30,000 foot risk management view I say something must be done to ensure these banks can never do this again. Turn banks into true banks. Hedging and exotic business models are fine. Just don't commingle them under the same umbrella as a deposit taking ``bank''. With that, a few ideas come to mind: * Our banking system should be aligned with the goals of the nation to help ``grease'' the wheels of the economic growth engine of the United States. Banks should be more like utilities and less like hedge funds. Otherwise, banking becomes counter-productive and potentially destructive. * Banks should not be allowed to exact onerous fees on the public or enact a business model which is inherently dependent on driving their customers deeper and deeper into debt. This undermines the entire goal of productive economic growth. * ``Banks'' should be true lending institutions. Non-traditional banking operations and products such as CDS, ``off balance sheet'' finance, derivatives as collateral and such would be deemed illegal unless performed only by non banking/lending institutions (such as hedge funds) so as to insulate the public and true lending institutions from the risk taking, ``hedging'', and ``financial innovation'' of firms such as Lehman Brothers.

ENRON BANKING SYSTEM; pragmatic capitalists.

naked capitalism Tue 2010-02-16 16:38 EST

AIG Scandal: Fed as Chump or Fed as Crony?

No matter which way you look at it, the picture that is emerging of the Federal Reserve, as revealed by the ongoing probes into its AIG bailout, is singularly unflattering. The explanations for its actions can only support one of two interpretations: that the Fed was a chump, taken by the financiers, or a crony, and was fully aware that it was not just rescuing AIG, but doing so in an overly generous way so as to assist financial firms in a way it hoped would not be widely noticed or understood...

AIG Scandal; chump; crony; Fed; naked capitalism.

naked capitalism Fri 2010-01-08 19:33 EST

Geithner's dubious AIG cover up

Edward Harrison

...This was looting and a cover-up plain and simple...Damaging e-mails have revealed that Treasury Secretary Timothy Geithner urged AIG to withhold crucial information about the deterioration of its financial condition in the lead up to its demise...He was on the job when these firms levered up and took reckless risks that endangered our financial system. For him to absolve himself of responsibility is a disgrace. And to add insult to injury, we now learn that he urged a systemically important company to withhold evidence of his looting of taxpayers. Tim Geithner must go.

Geithner's dubious AIG cover; naked capitalism.

Wed 2009-12-16 12:39 EST

'Sometimes I think, was it real?' The American bailout nightmare - Times Online

The architect of America's banking bailout has revealed for the first time the chaos behind the scenes at the US Treasury during the creation of the controversial $700 billion (>>425 billion) Troubled Asset Relief Program (Tarp).

American bailout nightmare; Real; Think; time online.

New Deal 2.0 Mon 2009-11-30 13:44 EST

Geithner's Disgrace

Eliot Spitzer

he issue has been festering for months: Why were AIG's counterparties -- including Goldman Sachs, JPMorgan Chase, and UBS -- paid 100 cents on the dollar when the feds rescued the insurance giant, helping raising the cost of the bailout to nearly $200 billion? A new report issued by Special Inspector General Neil Barofsky now reveals that government officials, notably then -- New York Fed President and current Treasury Secretary Timothy Geithner, grievously damaged the nation and capitulated to the very banks they should have been supervising.

0; Geithner's Disgrace; new dealing 2.

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.

Fri 2009-09-04 19:05 EDT

Lehman downfall triggered by UK and US mix-up

*** Communication breakdown revealed in first-hand accounts of bank collapse *** Blame game goes on as G20 ministers prepare for crucial London talks A breakdown in communications at the highest level between the US and the UK led to the shock collapse of the investment bank Lehman Brothers in September last year, a Guardian/Observer investigation has revealed. The downfall of Lehman, which triggered the biggest banking crisis since the Great Depression, came after a rescue bid by the high street bank Barclays failed to materialise. In London, the Treasury, the Bank of England and the Financial Services Authority all believed that the US government would step in with a financial guarantee for the troubled Wall Street bank.

Lehman downfall triggered; mixed; UK.

Mish's Global Economic Trend Analysis Wed 2009-08-26 16:00 EDT

Critically Under-Capitalized Banks Direct Result Of "Wonderful Chain of Stupidity"

Michael Shedlock

Last week the Wall Street Journal ran an article about how trust securities sank Guaranty Financial Group and six family-controlled Illinois banks in early July. Please consider In New Phase of Crisis, Securities Sink Banks. Federal officials on Thursday were poised to seize Guaranty Financial Group Inc., in what would be the 10th-largest bank failure in U.S. history. Guaranty's woes were caused by its investment portfolio, stuffed with deteriorating securities created from pools of mortgages originated by some of the nation's worst lenders. Delinquency rates on the holdings have soared as high as 40%, forcing write-downs last month that consumed all of the bank's capital. Guaranty is one of thousands of banks that invested in such securities, which were often highly rated but ultimately hinged on the health of... Security losses are a non-operating item and are listed after pre-tax operating income on the call report. This is very unusual and possibly reveals another cancer hiding on many banks balance sheets. those garbage trust-preferred securities problems are on top of the widely expected fallout from commercial real estate problems affecting small to medium-sized regional banks. Thus, banking woes are much deeper in many areas than either the FDIC or Fed is admitting.

Capitalized Banks Direct Result; Criticizes; Mish's Global Economic Trend Analysis; Stupid; Wonderful Chain.

Tue 2009-06-16 00:00 EDT

New Data Reveals Largest US Banks at Risk of Failure According to Weiss Research: JPMorgan Chase, Citibank, Wells Fargo, HSBC USA, Goldman Sachs, SunTrust, Compass, Fifth Third, and Huntington

bank; Citibank; compassion; failure; Goldman Sachs; HSBC USA; Huntington; JPMorgan chasing; New Data Reveals Largest; Risk; SunTrust; Weiss Research; Wells Fargo.

Tue 2009-06-16 00:00 EDT

naked capitalism: Capital One Reveals Big Increase in Credit Card Chargeoffs

capitalism; Credit card chargeoffs; naked capitalism; Reveals Big Increase.

Tue 2009-06-16 00:00 EDT

naked capitalism: Guest Post: Stress tests reveal Citi and BofA need more capital, but you knew that already

BofA need; capitalism; Guest Post; knew; naked capitalism; Stress tests reveal Citi.

Fri 2008-03-28 00:00 EDT

AlterNet: The Wright Controversy Revealed America's Gutless, Panicky, Deeply Insecure Side

by Matt Taibbi; "A society at peace with itself wouldn't have reacted in the way it did to the partly true/partly crazy remarks of Obama's former pastor."

AlterNet; Deeply Insecure Side; panicky; Wright Controversy Revealed America's Gutless.

Wed 2008-03-26 00:00 EDT

Barack Obama's Smart Speech "A More Perfect Union": Did It Reveal Him To Be Too Intellectual To Be President? | The Smirking Chimp

Barack Obama's Smart Speech "A More Perfect Union": Did It Reveal Him To Be Too Intellectual To Be President? by John Dean | The Smirking Chimp; "Republicans have spent the past half century dumbing-down the American presidency, for it has helped them win the White House"; "Anti-intellectual Republican presidents have led this nation into a new age of unreason"

Barack Obama's Smart Speech; intellectual; Perfect Union; President; revealed; Smirking Chimp.

Tue 2008-02-12 00:00 EST

The Wall Street Examiner >> Fed Eunuchs Reveal True Selves In Technicolor

by Lee Adler; "Fed has aggressively collapsed the size of the System Open Market Account...to withdraw billions of dollars of what is, in essence, margin buying power from the trading accounts of the Primary Dealers"

Feds Eunuchs Reveals True Selves; Technicolor; Wall Street Examiner.

Thu 2007-11-01 00:00 EDT

Funhouse Mirrors #1: Personal Savings Rate - iTulip.com Forums

overstating GDP; understating inflation; personal savings rate reveals failure of earnings to offset inflation

1; com forums; funhouse Mirror; iTulip; personal savings rate.

Fri 2007-04-06 00:00 EDT

Rolling Stone : National Affairs: Cheney's Nemesis, Seymour Hersh, Reveals White House's Secret Plan to Bomb Iran

Rolling Stone : National Affairs: Cheney's Nemesis, Seymour Hersh, Reveals White House's Secret Plan to Bomb Iran, by Matt Taibbi

Bomb Iran; Cheney's Nemesis; national affairs; Reveals White House's Secret Plan; Rolling Stone; Seymour Hersh.

Fri 2006-12-22 00:00 EST

Report Reveals 2.2 Million Borrowers Face Foreclosure on Subprime Home Loans; Homeowners to lose Billions - Center for Responsible Lending

2; borrowers face foreclosure; center; homeowners; lose billions; Report Reveals 2; Responsible Lending; subprime home loans.