Tom Jacobs's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/199360/comments http://seekingalpha.com/article/173169-the-fed-cracks-down-on-overdrafts?source=feed#comment-759705 759705
www.librarything.com/w...

which emphasized making consumer friendly defaults like contributing to a 401K requiring one to opt out if desired, would be embedded in any policy adopted today by enlightened regulators. It does not say much for the Fed's attempt to beat any planned Consumer Financial Protection agency to the punch. ]]> Fri, 13 Nov 2009 21:39:33 -0500
www.librarything.com/w...

which emphasized making consumer friendly defaults like contributing to a 401K requiring one to opt out if desired, would be embedded in any policy adopted today by enlightened regulators. It does not say much for the Fed's attempt to beat any planned Consumer Financial Protection agency to the punch. ]]> http://seekingalpha.com/article/160187-the-five-most-effective-bailouts?source=feed#comment-665380 665380 Mon, 07 Sep 2009 14:31:34 -0400 http://seekingalpha.com/article/159321-bloomberg-vs-the-fed-secrecy-and-moral-hazard?source=feed#comment-657661 657661
2. As significant balances such as transaction accounts and amounts above the FDIC insurance limit are uninsured, traditional runs are still a problem. Just examine what led the FDIC to move on WAMU and Wachovia.]]> Tue, 01 Sep 2009 23:04:19 -0400
2. As significant balances such as transaction accounts and amounts above the FDIC insurance limit are uninsured, traditional runs are still a problem. Just examine what led the FDIC to move on WAMU and Wachovia.]]> http://seekingalpha.com/article/158379-time-to-change-gses-deal-with-treasury?source=feed#comment-651792 651792 Fri, 28 Aug 2009 19:29:36 -0400 http://seekingalpha.com/article/151191-bernanke-on-consumer-protection-no-fur-flew?source=feed#comment-602269 602269 Sat, 25 Jul 2009 23:39:48 -0400 http://seekingalpha.com/article/149980-7-9-billion-kazakhstan-bank-loss-shows-why-cds-must-be-regulated?source=feed#comment-597440 597440 Tue, 21 Jul 2009 22:43:02 -0400 http://seekingalpha.com/article/141928-a-better-corporate-credit-risk-model-still-not-in-sight?source=feed#comment-537948 537948
While I won't dispute a number of the criticisms the author has provided for building a good model or the failure of most practitioners to understand, collect, clean and appropriately use their data with a given model, something needs to be done differently and anything open source is at least a step in the right direction. Some credit should be given for at least trying to change from the status quo.]]> Mon, 08 Jun 2009 19:41:38 -0400
While I won't dispute a number of the criticisms the author has provided for building a good model or the failure of most practitioners to understand, collect, clean and appropriately use their data with a given model, something needs to be done differently and anything open source is at least a step in the right direction. Some credit should be given for at least trying to change from the status quo.]]> http://seekingalpha.com/article/141750-u-s-banks-putting-lipstick-on-a-pig?source=feed#comment-535689 535689
I generally find your posts, this one included, credible and in the right direction, but I believe that the inflammatory language detracts from your analysis. There is nothing wrong with tact. You have strong arguments and the only perception I get from "crime syndicate" or "feces" is to question your judgment.

I have not observed Bloomberg to be a Wall Street mouthpiece at any point of the crisis. They took the lead on challenging the Fed's secrecy regarding its actions, not a step that a Wall Street mouthpiece would pursue when the Fed has repeatedly acted to protect Wall Street and the status quo.

Tom]]> Sun, 07 Jun 2009 11:14:21 -0400
I generally find your posts, this one included, credible and in the right direction, but I believe that the inflammatory language detracts from your analysis. There is nothing wrong with tact. You have strong arguments and the only perception I get from "crime syndicate" or "feces" is to question your judgment.

I have not observed Bloomberg to be a Wall Street mouthpiece at any point of the crisis. They took the lead on challenging the Fed's secrecy regarding its actions, not a step that a Wall Street mouthpiece would pursue when the Fed has repeatedly acted to protect Wall Street and the status quo.

Tom]]> http://seekingalpha.com/article/140692-understanding-nassim-taleb?source=feed#comment-528716 528716 Tue, 02 Jun 2009 16:46:39 -0400 http://seekingalpha.com/article/140117-brazen-bank-tunneling-and-inflation?source=feed#comment-522757 522757 Fri, 29 May 2009 10:02:13 -0400 http://seekingalpha.com/article/140211-fed-finds-a-way-to-use-stress-tests-to-screw-bank-shareholders-one-more-time?source=feed#comment-522739 522739 Fri, 29 May 2009 09:50:58 -0400 http://seekingalpha.com/article/139868-the-backwards-credit-card-model?source=feed#comment-522187 522187 Thu, 28 May 2009 21:06:20 -0400 http://seekingalpha.com/article/138047-how-cds-spreads-affect-equity?source=feed#comment-510619 510619 Tue, 19 May 2009 22:25:08 -0400 http://seekingalpha.com/article/137889-jpmorgan-amex-issue-non-fdic-backed-debt?source=feed#comment-510610 510610
www.federalreserve.gov...

the difference was 46bp using CMT for 5 Year Treasury, lowering your balance sheet cost to about 110bp for the JP Morgan placement. Still a big number.]]> Tue, 19 May 2009 22:14:24 -0400
www.federalreserve.gov...

the difference was 46bp using CMT for 5 Year Treasury, lowering your balance sheet cost to about 110bp for the JP Morgan placement. Still a big number.]]> http://seekingalpha.com/article/137339-the-wild-and-crazy-world-of-self-referenced-credit?source=feed#comment-502492 502492
Tom]]> Wed, 13 May 2009 15:02:12 -0400
Tom]]> http://seekingalpha.com/article/135706-writing-naked-cds-when-murder-and-betting-on-it-is-legal?source=feed#comment-496076 496076
I also liked this line from the Barron's piece: "If the total cost of buying a bond and insuring it to par is less than par, it creates an arbitrage that ultimately destroys capital." How does this destroy capital? The arbitrage is to buy the bond and buy protection on the CDS which will drive up the bond price and the cost of insurance until par is reached and the arbitrage is gone.

Tom]]> Fri, 08 May 2009 17:00:25 -0400
I also liked this line from the Barron's piece: "If the total cost of buying a bond and insuring it to par is less than par, it creates an arbitrage that ultimately destroys capital." How does this destroy capital? The arbitrage is to buy the bond and buy protection on the CDS which will drive up the bond price and the cost of insurance until par is reached and the arbitrage is gone.

Tom]]> http://seekingalpha.com/article/135685-fdic-regulation-reason-for-alarm?source=feed#comment-493248 493248
www.washingtonpost.com...]]> Thu, 07 May 2009 01:42:14 -0400
www.washingtonpost.com...]]> http://seekingalpha.com/article/125539-berkshire-s-huge-exposure-nonsense?source=feed#comment-434252 434252
I still cannot get over the hypocrisy in all of Buffet's "derivatives are weapons of mass destruction" hysteria. He can't have it both ways. If anyone can justify selling these large option positions from a speculative position (there is no hedge here) then how are derivatives such evil contracts?]]> Sat, 21 Mar 2009 00:06:29 -0400
I still cannot get over the hypocrisy in all of Buffet's "derivatives are weapons of mass destruction" hysteria. He can't have it both ways. If anyone can justify selling these large option positions from a speculative position (there is no hedge here) then how are derivatives such evil contracts?]]> http://seekingalpha.com/article/124879-a-positive-step-for-the-cds-market?source=feed#comment-425294 425294 Fri, 13 Mar 2009 22:24:05 -0400 http://seekingalpha.com/article/120608-are-uninsured-bank-depositors-in-danger?source=feed#comment-394495 394495 Thu, 19 Feb 2009 00:39:23 -0500 http://seekingalpha.com/article/109953-in-defense-of-the-cds-market?source=feed#comment-328653 328653 Sun, 14 Dec 2008 00:13:02 -0500 http://seekingalpha.com/article/106091-why-aig-was-in-the-cds-business?source=feed#comment-306897 306897
The problem here, as mentioned by another poster, is that AIG did not plan for the collateral calls of marking to market on something widely viewed as AAA+ (the super senior tranches of these CDOs). Why they did not is simply politics. When a business unit at one of these organizations is making money no one has the power to question them. Not internal risk managers and certainly not regulators. They may sing and dance about their independent reporting lines for risk management to the CEO but the reality is no one will get anywhere saying "you need to reserve againt AAA+ tranches going down, rating agencies don't know what they are doing, etc." With all the overlapping branches of regulation the one to try and call the company on the carpet BEFORE the problem occurs is always immediately attacked as extreme by the other regulators. I am not making this up - I have seen it myself. The other simple fact is that no one has cracked the code on default correlation or even default - recovery correlation on corporate names, let alone individual mortgage borrowers.]]> Sat, 15 Nov 2008 22:56:57 -0500
The problem here, as mentioned by another poster, is that AIG did not plan for the collateral calls of marking to market on something widely viewed as AAA+ (the super senior tranches of these CDOs). Why they did not is simply politics. When a business unit at one of these organizations is making money no one has the power to question them. Not internal risk managers and certainly not regulators. They may sing and dance about their independent reporting lines for risk management to the CEO but the reality is no one will get anywhere saying "you need to reserve againt AAA+ tranches going down, rating agencies don't know what they are doing, etc." With all the overlapping branches of regulation the one to try and call the company on the carpet BEFORE the problem occurs is always immediately attacked as extreme by the other regulators. I am not making this up - I have seen it myself. The other simple fact is that no one has cracked the code on default correlation or even default - recovery correlation on corporate names, let alone individual mortgage borrowers.]]> http://seekingalpha.com/article/105142-where-are-the-tips-strips?source=feed#comment-305709 305709

On Nov 11 12:55 PM dr.doolittle wrote:

> say what?]]> Thu, 13 Nov 2008 22:24:33 -0500

On Nov 11 12:55 PM dr.doolittle wrote:

> say what?]]> http://seekingalpha.com/article/104367-memo-to-congress-please-stop-obsessing-over-bank-execs-bonuses?source=feed#comment-299815 299815 Thu, 06 Nov 2008 21:18:52 -0500 http://seekingalpha.com/article/102987-when-banks-stop-underwriting?source=feed#comment-295043 295043
On the evils of derivatives arguments it just gets worse and worse. Just because Warren Buffet blew his due diligence on General Re:

"When we purchased Gen Re, it came with General Re Securities, a derivatives dealer that Charlie and I didn’t want, judging it to be dangerous. We failed in our attempts to sell the operation, however, and are now terminating it.

But closing down a derivatives business is easier said than done. It will be a great many years before we are totally out of this operation (though we reduce our exposure daily). In fact, the reinsurance and derivatives businesses are similar: Like Hell, both are easy to enter and almost impossible to exit. In either industry, once you write a contract – which may require a large payment decades later – you are usually stuck with it. True, there are methods by which the risk can be laid off with others. But most strategies of that kind leave you with residual liability."

(from:

www.myprops.org/conten.../

we are now saddled with the endless doom and gloom over products that are great for clients when they reach commodity status but always cause problems when banks first develop them since clients are so easily convinced to pay a lot for something they don't need unlike the rest of human experience with the sales process. The misrepresentation by all of these ignorant pundits is really sickening.]]> Fri, 31 Oct 2008 10:15:11 -0400
On the evils of derivatives arguments it just gets worse and worse. Just because Warren Buffet blew his due diligence on General Re:

"When we purchased Gen Re, it came with General Re Securities, a derivatives dealer that Charlie and I didn’t want, judging it to be dangerous. We failed in our attempts to sell the operation, however, and are now terminating it.

But closing down a derivatives business is easier said than done. It will be a great many years before we are totally out of this operation (though we reduce our exposure daily). In fact, the reinsurance and derivatives businesses are similar: Like Hell, both are easy to enter and almost impossible to exit. In either industry, once you write a contract – which may require a large payment decades later – you are usually stuck with it. True, there are methods by which the risk can be laid off with others. But most strategies of that kind leave you with residual liability."

(from:

www.myprops.org/conten.../

we are now saddled with the endless doom and gloom over products that are great for clients when they reach commodity status but always cause problems when banks first develop them since clients are so easily convinced to pay a lot for something they don't need unlike the rest of human experience with the sales process. The misrepresentation by all of these ignorant pundits is really sickening.]]> http://seekingalpha.com/article/103058-chart-of-the-day-the-russia-brazil-spread?source=feed#comment-295010 295010
www.thefreelibrary.com...

one could get the historical rates on Google finance, indeed one could still access daily data up through March of 2007 until recently, but I can no longer find it there. ]]> Fri, 31 Oct 2008 09:50:02 -0400
www.thefreelibrary.com...

one could get the historical rates on Google finance, indeed one could still access daily data up through March of 2007 until recently, but I can no longer find it there. ]]> http://seekingalpha.com/article/100700-buffett-says-short-uncle-sam?source=feed#comment-287708 287708 Wed, 22 Oct 2008 09:53:46 -0400 http://seekingalpha.com/article/100469-aig-gets-the-scarlet-letter?source=feed#comment-285465 285465
www.dealbreaker.com/20...

He is so sincere when he makes all these statements about increasing taxes for everyone else (keep the death tax, raise property taxes in California, etc.)

Am I the only one disgusted by all the hypocrisy between his behavior and his public statements?]]> Sun, 19 Oct 2008 01:26:11 -0400
www.dealbreaker.com/20...

He is so sincere when he makes all these statements about increasing taxes for everyone else (keep the death tax, raise property taxes in California, etc.)

Am I the only one disgusted by all the hypocrisy between his behavior and his public statements?]]> http://seekingalpha.com/article/89452-the-wsj-s-broken-subscription-system?source=feed#comment-226605 226605
There was zero recognition that I as a customer had any value. It took me a long time to get used to not reading it every day and I am sure they are happier without me and my subscription fees. Further, as an academic, I will never sign up for a class, either. I have never seen such a broken business model.

Tom]]> Fri, 08 Aug 2008 23:55:53 -0400
There was zero recognition that I as a customer had any value. It took me a long time to get used to not reading it every day and I am sure they are happier without me and my subscription fees. Further, as an academic, I will never sign up for a class, either. I have never seen such a broken business model.

Tom]]> http://seekingalpha.com/article/84605-setting-the-record-straight-taxpayers-not-funding-jp-morgan-s-bear-buyout?source=feed#comment-202887 202887 Fri, 11 Jul 2008 09:40:46 -0400