cabanker

Banks who will be fingered if the Fed is forced to divulge where its money has gone over the past year are none-too-happy: "The Court's Order threatens to impair the ability of our members to access emergency funds through the NY Fed's Discount Window without suffering the severe competitive harm that public disclosure of their identity will cause," they say in a declaration filed yesterday.

I have no faith in the Fed or Treasury. Bernanke, Paulson and now Geithner continue to greese the palms in their "circle of friends". This has to stop in order for anyone to have confidence in the US financial system. When you have the French calling for an alternative reserve currency to the dollar it shows what a sorry state of affairs things have become. It's like the Mountain West Conference saying we need an alternative to the BCS rankings....

Dick Bove on Citigroup (C), up 8.7% today: "People are buying it now in expectation of the triple [that shares will be worth three times as much in three years] because they made the decision that all of the negatives that could happen don't mean anything."

Bove has been wrong for three years on the financials. He was wrong on the way down and wrong over the last 9 months. He's also on his 3 or 4th firm in as many years. Who's he with this week?

The growing divergence in the approaches of central bankers will lead to volatile markets and a weaker dollar, Pimco CEO Mohamed El-Erian says. "The question is not whether the dollar will weaken over time, but how it will weaken. The real risk is that you will get a disorderly decline." Presently, dollar is flat.

Pimco is good, but they "talk their book" far too often. Where's the disclosure...."we own a ton of US denominated debt, we can't hedge it in any meaningful way", so our only way to hedge long term values is to talk about pending inflation doom constantly".

As CNBC struggles with a decline in viewership, the two-year-old Fox Business Network may replace three hours of morning finance programs - Fox Business Morning and Money for Breakfast - with a general-interest show from talk host Don Imus.

Ugh. No more Jenna, Alexis and Sabani? Guess I'll have to get back to business and keep the channel on Bloomberg full time now......They've been a nice diversion.

Was the AIG Bailout a Goldman Bailout by Proxy?

Keep up the excellent work on GS. I am convinced that if enough investigation is done into Goldman's trading practices during the fall of 08, more will come out. The CDS of every major firm were trading fast and furious with large volume. We all know they were not being used to hedge an underlying positions, but to deliberately bring down the confidence of the market, the equity and ultimately the collapse of some major competitors of GS and Hank Paulson.
At this point only a wonded MS and BAC are left along with JPM. And GS has issued billions in bonds backed by the taxpayers, so they can take home fat bonuses.

Ben Stein: "The sad truth is that the economy is still extremely ill. The recovery we were all waiting for has not started in any meaningful way."

Bueller? Bueller? Ben needs to go back to acting!! Actually I'm in agreement with Ben on his point regarding the economy. However, the reality is that the loan mods are not going to help us out of this, nor are new loans. We've got people seriously underwater and they either have to walk or get a principal reduction. Either way, the end result is that the 1/2 of the loan portfolios are worth $.60 on the $1.00. At some point we all have to wake up to that fact.

David Weidner wishes Madoff victims would stop whining. So does Joe Nocera: "They were robbed, pure and simple, and the government is not in the business of reimbursing for robberies. Not even when the cops stumble across the robbers and then mistakenly let them go."

Agreed, these people need to buck up. It's not the Government's responsibility to make up for their losses. There was writing on the wall for years and the investors chose to ignore it out of either greed or stupidity. Did they ever hear of diversification? Don't put all your eggs in 1 basket?
I (and many others) took a bath in financial stocks last year as some of the Banks I owned went under. No one is bailing me out. Suck it up an move on.
Oh and btw, how much of their losses were paper vs. actual $ invested?

After the bell, SEC announces filing fraud charges against 3 former Countrywide executives including CEO Angelo Mozilo and President David Sambol. Mozilo is also charged with insider trading. SEC enforcement chief says Mozilo "raked in $140 million while fully aware Countrywide's business was deteriorating and facing a bleak future."

Is it just me or was Mozilo an Umpa Lumpa before running Countrywide? Maybe it's just the orange skin, grey hair and 5'5" frame....paz83.files.wordpress....

Why did lenders Citigroup (C), Morgan (MS), Goldman (GS) and JPMorgan (JPM) approve Chrysler's $0.29 on the dollar offer while smaller firms held out? Maybe because the gov't left the TARP recipients little choice, confirming "the worst fears of how bailouts of banks would warp the markets."

Once I saw that the "big" bank's settled, I had no doubt that it was due to "political pressure". The individuals running the large banks are all smart people. I seriously doubt that OBama even had to pick up the phone. He had them all out for a meeting a few weeks ago after the AIG bonus scandel and discussed the need to "work together". If they go against the grain on any of the large restructurings (Chrystler, GM..), they'd be cutting off their own lifelines (TARP $, government backed bonds, stress test negotiations...).

Visualizing Job Losses and Gains in U.S.

Great visual. Hard to imagine we are going to have any kind of sustained rally in housing prices with unemployment continuing to climb month after month. I'm seeing "lots" of for sale signs in the bay area, and very few "sold".
The Banks may be able to offset the continued loan loss provisions with NIM, so that sector should begin to settle (stock prices have already reflected that fact).
The big question is where do we go from here in sectors ex-financials? Is the new normal 10%+ unemployment?

Goldman Sachs (GS) hires a law firm to shut down blogger Mike Morgan, whose Facts About Goldman Sachs blog apparently irks the firm it targets. In the meantime, the attention is driving traffic to the blog - big time. On Saturday, the blog's web counter had logged just 40 visits. Now it's up to 102,899... make that 103,517.

We'll see if the internet can spawn a populist uprising against the bailout sham. Willoughby had a good piece in Barrons this weekend with William Black. There are enough people writing about the b.s. which began with Paulson and is being continued with Giethner, that we could get some traction.

Meredith Whitney sticks up for Ken Lewis (BAC).

Only problem was Merrill? Did she happen to notice the $2 billion investment into Countrywide in late '07, followed by the early '08 acquisition at $4 billion for a combined total of a cool $6 billion? Couple that with all the portfolio write-downs and I'm sure they've shoveled north of $30 billion down that rat hole.......
But at least they have an origination platform for mortgages they won't be able to securitize and sell anymore....

Regulating Compensation: Where Does It Stop?

The "AIG Tax" bill which passed the House is a "very" slippery slope. Where does it end? The auto manufacturers took TARP funds are their employees included? How about the banks that took under $5 billion, why not tax their executives as well? What about "any and all" employees of GE subsidiaries (NBC, CNBC, GE Capital...etc)? Shouldn't we also look at employees of all companies with government contracts? Boeing, McDonald Douglas...etc.?
Trying to manage this through the tax code does not seem very strategic with the cure worse than the disease.

The AIG Bailout: Why Was the Onus Placed on Taxpayers?

Am I the only one who questions Paulson's motives of bailing out AIG? From the start I figured Goldman was going to be the largest beneficiary. It's certainly looking that way now.

JPMorgan (JPM) slashes dividend to $0.05 from $0.38. "Our action today is being done as a strong precautionary measure to help ensure that our fortress balance sheet remains intact - even if conditions worsen significantly." Says Q1 so far is in-line. Shares -1.8% AH. (PR)

The save from the dividend could pay for a nice sized acquisition, given the imploding market caps......