InnocentsAbroad

Antitrust for Banks?

Very hard to believe that any significant anti trust activity will be coming out of DC. Interestingly enough, the Left doesn't have much contemporary interest in ant trust. I think it is just too difficult a subject for the American public.

Probably the only hope is that a coterie of irritable and intellectual Federal attorneys tackle it. There are truly some benefits to altruism, and being an anti trust attorney sure is altruistic.

One way to push the thing ahead is to open up the Federal courts to stronger civil law for bases for cases. That could probably be done to some extent administratively. Please give us an update at some point. Huzzah for your postings on this.

Void Payout to Non-Debt Holders of CDSs

Nice article and comment stream.

I'd just like to advocate for a little different approach -- that derivative transactions be clearly identified as leveraged contracts, and then regulated the way that margin purchases of stock are, with a minimum downpayment.

I'm kind of thinking that they should be treated as traded securities, like other derivatives (futures contracts, options, etc).

This would stabilize markets and also provide some protection for companies and municipalities engaging in the derivative markets with a limited awareness of the hazards (the naive investor).

Time to Bury the Rotting Carcasses of Dead U.S. Banks

Monkeys have a hard time typing, because they don't have opposing thumbs.


On Mar 15 10:26 AM starwonder wrote:

> What is this idiotic Web site?
> Is any monkey with a computer allowed to post on it?
> What a joke!!

TARP Equals Toxic Money

Let's see. Free money makes a corporation less healthy ? You are probably right. The companies getting the Fed and Treasury money are bad bets.

A free lunch is never very healthy for a business in the long run. Companies that get subsidies usually end up on the ropes. They become focused on getting more free lunches, rather than producing products anyone would want.

Kind of like the auto industry and the New York banks.

Trying to remember how the poor single mothers were supposed to get off welfare ?

I can easily imagine a large high school cafeteria full of the creditors of GM and BAC, sitting down, and getting day long seminars on how to get productive work, now that their investment free lunches are no longer panning out. My question is, will they have to bring their own lunches to the seminars ?

Buffett's Financial Bets

Ok. Is it possible that on those companies, as with so many other investors, he had poor accounting data ?

I am just amazed at the current poor quality of accounting data for publicly held companies. The accounting academics are decades behind where the basic economy is.

My argument would be Warren Buffett just didn't have the time and energy to do full dilligence, as with so many other investors.

Why Bank Nationalization Will Never Happen

Please -- Barney Frank may be a corrupt idiot, but that doesn't mean he is the root of the problem.

You might do better to review the history of financial regulation beginning with Ronald Reagan. This is ultimately the return to roost of an ideology that the financial markets needs no regulation.

Ronald Reagan and his heirs paved the way for the whole range of financial re - engineering that made the current collapse possible.

Why Bank Nationalization Will Never Happen

Umm. Sorry Mr. Sage. Happy Days are not right around the corner. The money center banks and their various partners and creditors are doing everything possible to give the taxpayer the tab.

No level of transparency is going to occur prior to that, simply because it doesn't look good politically to transfer money from the ultra poor (the tax paying public) to the ultra rick (the bank owners and debtors).

In factor, I will be very surprised the day some basic accounting transparency regarding the money center banks occurs.

By the way, please don't use terms that have no meaning. "Nationalization" is a term of rhetoric, not economics. Do you mean purchase ? Or condemnation ? Or forced receivership ? Or expropriation ? I really like Seeking Alpha, but gosh, a whole lot of articles here appear to be written by 3rd graders.

(sorry, just my opinion)

JPMorgan Chase: Poisoned by Bear's 5,000 Counterparties

Wow. Very interesting observation on a member of the general public's experience with JPM as a service provider.

My general take (and I greatly appreciate Mr. Saxena's nice article), is that the problem is not only one of disclosure, but also one of the moral capacity to carry out fiduciary duty -- whether at the Fed, the Treasury, the FDIC, or the SEC.

Suspect when all is said and done we are looking at more of a systemic moral failure, rather than just a cyclical political economy problem.

On top of that, malfeasance, either in government or in the government sponsored private banks, seems to not only be endemic, but also as a general rule unpunished.

My continued reading of the core problem facing the economy today makes the US economy not dissimilar to that of the Russian Republic, or of communist China. The cycles of behavior of the wealthy and powerful appear to be more that of a corrupt plutocracy, rather than that of a republic.

What Obama Needs to Know about Tim Geithner, the AIG Fiasco and Citigroup

Pls correct to: The US government may absorb its debts, but that only protects its creditors who made a bad bet in the first place.

What Obama Needs to Know about Tim Geithner, the AIG Fiasco and Citigroup

Actually, a nice dialogue here, getting to the critical issue, which is US net indebtedness. It is US industrial weakness we are looking at. Thus the puzzle of the flight to US financial markets as savior, and yet the source of the crisis. In the long run, however, good credits will get financing, and bad credits will not. AIG is a bad credit. The US government may absorb its debts, but that only protects its debtors who made a bad bet in the first place. The US taxpayer is bailing out speculators. There is no way around that. Rich speculators are being paid off to go speculate another day. Which they will.


On Nov 26 10:04 AM Steve Pluvia wrote:

> You, lost me early in this overly-long soap-box stint.
>
> Are you *seriously* suggesting the U.S. let AIG blow-up?
>
> So let me see if I get your point...
>
> Let AIG fail; All foreign held debt insured by AIG blows up...
>
> -- US treasury and corporate debt immediately has zero credibility;
>
> -- US corporations and have zero borrowing power for short term trade
> and expansion.
> -- Trade grinds to a halt as foreign partners no longer honor purchase
> orders from US corporations.
> -- Run on all banks;
> -- The dollar gets crushed; and,
> -- The US have very little ability to jump start the US economy with
> spending
>
> Oy freakin vey. Your idea is ridiculous. Clearly you don't understand
> the implications of what you propose.
>