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Tricky

Tricky
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  • The Obama administration's new lending fund aimed at helping small businesses may not be enough to overcome banks' reluctance to make loans. Community bankers cite an "unprecedented" level of toughness from regulators, rendering them unwilling to underwrite loans they would normally make since they "could cost [the bank] dearly" in setting aside extra capital.  [View news story]
    I'll take your word for it, but does that have anything to do with CRA? Or even "forcing banks to lend to poor people"?

    Or are you now making a different statement about some other issue?
    Dec 3, 2010. 01:26 PM | 1 Like Like |Link to Comment
  • The ballyhooed convergence between magazines and the iPad (AAPL) isn't going as quickly as it could, with publishers and Apple far apart on how iTunes periodical subscriptions should go. The battle's focused on who's got control over sales and subscribers' data, and publishers don't like Apple's 30% cut - so they're taking fresh looks at Android (GOOG).  [View news story]
    I'm involved with a mobile app startup with these exact same problems with Apple. They can be absolutely infuriating to deal with. The recurring subscriptions issue is particularly vexing. The 30% cut is obviously also vexing -- there are workarounds but Apple is trying to shut those down.

    This is why I respect Apple's accomplishments and we certainly can't ignore their user base, but I hope Android keeps making inroads -- otherwise Apple would become even more insufferable for developers.
    Dec 3, 2010. 01:23 PM | 1 Like Like |Link to Comment
  • The Obama administration's new lending fund aimed at helping small businesses may not be enough to overcome banks' reluctance to make loans. Community bankers cite an "unprecedented" level of toughness from regulators, rendering them unwilling to underwrite loans they would normally make since they "could cost [the bank] dearly" in setting aside extra capital.  [View news story]
    A couple of studies have also show that -- in rough numbers -- 50% of subprime loans were originated by entities (i.e., mortgage brokers) that aren't regulated by CRA at all, 25% that are lightly regulated, only 25% by institutions that are fully regulated.

    So if you want to overhaul CRA, believe me, you've got my support. But to then conclude that even the total elimination of CRA would have prevented the crisis just simply isn't correct. I'd rather that energies be focused on fixing the BIGGEST problems (as nice as addressing all problems would be)
    Dec 3, 2010. 12:47 PM | 3 Likes Like |Link to Comment
  • The Obama administration's new lending fund aimed at helping small businesses may not be enough to overcome banks' reluctance to make loans. Community bankers cite an "unprecedented" level of toughness from regulators, rendering them unwilling to underwrite loans they would normally make since they "could cost [the bank] dearly" in setting aside extra capital.  [View news story]
    I'm no liberal, but I am data driven. The claim that "CRA is the root of all the financial crisis" isn't a very strong one. Was it A contributor? Yeah, a bit. But D_Virginia always responds with the same data, that no one ever seems to have a reply for -- the vast majority of subprime wasn't to "the poor" or even in "poor 'hoods". A ton of it was for investment properties, those weren't taken out by "the poor".

    I'm totally sympathetic to the outrage of using big subsidies to tackle a symptom ("poor have lower home ownership") rather than addressing root causes ("why are they poor in the first place"). But to then claim CRA (et al) were the biggest sources of the crisis just simply doesn't fly, when you look at the data and look at all the other issues that got the bubble so big.
    Dec 3, 2010. 11:52 AM | 3 Likes Like |Link to Comment
  • Theatrics were on display in Congress today, as Democrats in the House passed a tax-cut extension for the middle class but not the rich - knowing the bill would die in the Senate. Both parties face pressure from their hard-line flanks to make no concessions, but lawmakers fear the anger that would erupt if they do nothing - so who blinks first?  [View news story]
    Yep, they're both being a-holes. For instance, I have not heard 1 good reason -- actually I haven't heard ANY reason -- out of the Rep's as to why the START treaty isn't being ratified.
    Dec 2, 2010. 05:48 PM | 1 Like Like |Link to Comment
  • For the first time since 2008, Goldman Sachs goes positive on financials, upgrading its rating on the sector to Overweight and making the KBW Bank Index (BKX) a factor in its "top trades." The firm sees improvement in loan demand, capital clarity and capital markets activity, and expects pressure on long-term rates to subside. (earlier)  [View news story]
    And our lobbying dollars are paying off handsomely
    Dec 2, 2010. 11:57 AM | 1 Like Like |Link to Comment
  • The iPhone (AAPL) and BlackBerry (RIMM) are in a dead heat, with each owning about 27% of the U.S. smartphone market, says Nielsen, citing October data. About 22% of U.S. customers use Android (GOOG) handsets. Overall, 30% of all U.S. mobile subscribers own a smartphone.  [View news story]
    Per usual, the story of the smartphone OS wars depends on what story you want to explore -- shipments v installs v rev v profits and then absolute v relative.

    To me, the most important near-term story for investors is that the total pie is growing for everyone, rapidly. No matter what % of the pie, the absolute size of the slices sitting on the plate are growing for AAPL, GOOG and RIM.

    Will be interesting to see if NOK and MSFT have anything to say about it in 2011.

    It's a fascinating war, even more fun to watch than the early PC OS wars were.
    Dec 1, 2010. 11:22 AM | 1 Like Like |Link to Comment
  • Here Comes Europe's 'Lehman Event' [View article]
    To be a little more accurate with analogies, the "Lehman event" for Europe will be when German taxpayers scream so loudly that the German government refuses to rescue someone.
    Dec 1, 2010. 09:09 AM | 3 Likes Like |Link to Comment
  • Forget Gold, Buy Diamonds [View article]
    One very important update -- De Beers WAS the monopoly, by virtue of its ownership/control over the vast majority of the world's diamonds. But Russia has always had massive reserves and started exploiting them in its post-Soviet era. To date, they have cooperated with De Beers. We'll see what happens going forward. Also, De Beers control of mines outside of South Africa isn't quite what it used to be.

    But I agree with all of your fundamental conclusions that the high price of diamonds is driven purely by artificial constriction of supply (and outstanding marketing) rather than anything inherent in its rarity or indispensibility. I'm in gold and many different plays on oil.
    Dec 1, 2010. 09:01 AM | 6 Likes Like |Link to Comment
  • Saying observers "are tending to underestimate the determination of governments," Jean-Claude Trichet let it be known that officials are ready to increase their response to the European debt crisis. Risk premiums for PIIGS debt are falling and the euro stands at $1.31 +0.85%.  [View news story]
    No, I don't underestimate the determination of PIIGS governments to spend German and US taxpayer dollars. Of course, we'll have to see how much appetite the German taxpayers continue to feel about that. As for Americans, the vast majority don't even know their taxpayer dollars are being spent on this (via IMF), so that well will keep getting tapped without much squelching.
    Dec 1, 2010. 08:23 AM | 3 Likes Like |Link to Comment
  • U.S. Treasuries Holders: China Is #2 [View article]
    ^ are all of the "buyers" shown in the chart governmental buyers or does this also include origin of the purchaser, therefore including private purchasers?
    Nov 28, 2010. 08:00 AM | 1 Like Like |Link to Comment
  • The U.S. isn't falling behind - the world is catching up, Michael Elliott writes. The U.S. has the resources and ingenuity to meet its challenges and prosper, but will it ever regain its old dominance. No, and "get over it."  [View news story]
    It's just reality to recognize that some of the most populous countries in the world aren't shooting themselves in the foot (as much, anyway) with adhering to catastrophically failed economic systems like communism [although I guess that's the cue for the usual suspects to explain how US is currently being run by a communist regime, oy].

    So we're going to face more competition than we have before.
    Nov 24, 2010. 08:17 PM | 1 Like Like |Link to Comment
  • Warren Buffett Says Taxing the Rich More Is Key to U.S. Recovery [View article]
    "The top 20% already pay 80% of the federal income taxes"

    Okay. The top 20% also make 60% of the income and own more than 90% of wealth in the US.

    I agree that having nearly half of households pay nothing can lead to some pernicious effects, but I'm finding it hard to work up sympathy for high income/wealth households (of which I am one). Sure, plenty of them are truly self made (I am) but plenty of others inherited the money, or at least the connections, from their wealthy parents.
    Nov 24, 2010. 07:58 PM | 2 Likes Like |Link to Comment
  • News Corp.'s (NWS -3.1%) $360M purchase of 90% of education technology provider Wireless Generation 'just doesn't make sense.' Wireless isn't 'wildly profitable,' there were no other known suitors, and it provides no 'unique advantages' to News Corp., which won't know how to digest it, anyway.  [View news story]
    Hopefully they'll do better than they did with MySpace
    Nov 23, 2010. 03:27 PM | 1 Like Like |Link to Comment
  • Volkswagen (VLKAY.PK) will invest $71B over five years in new production facilities and R&D, as it ramps up plans to overtake Toyota (TM) as the world's biggest automaker. “We want to make Volkswagen the world’s most future-proof automotive group,” CEO Martin Winterkorn says.  [View news story]
    When Toyota got a blind ambition for market share, that's when its quality problems started. Hopefully VW will learn from that, but all I keep hearing is "we're going to be bigger than Toyota"
    Nov 19, 2010. 10:11 AM | Likes Like |Link to Comment
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