Gtarras

Regulatory Arbitrage Attempt of the Day

Felix
I am curious how exactly Goldman is providing this insurance? Is there any details? Is Goldman Sachs the BANK the protection provider or they have set up and Special Purpose Company for these means? Such as Derivative Product Company many of the IBs were setting up in the years prior to the Lehman bust (after successful Primus IPO).

These DPCs are now either shelved or in run-off, but I got interested if Goldman is trying to revive them, exactly for the reasons you mention. DPC would be off Goldman's balance sheet and regulated as an insurance company, i.e. would be able to attain higher leverage.

Mortgage Modification Programs Are 10X More Expensive than You Think

I have reread your piece and actually am kind of angry now. This is one total misrepresentation of the current plan . You probably have not followed the mod plans as close as I did. First off, the data in your report was WELL KNOWN before the administration came out with final version in Feb, and was widely discussed by people involved (Bair, etc)., Thus many more things were built into the current Obama program to address the issues and reduce the rate of redefault. I am sorry, but your readers would be well advised to look some place else, such as for Citi banks assessment of the current plan. Yours is based on old attempts, an d I cant believe you would put it out, to put it mildly.

Mortgage Modification Programs Are 10X More Expensive than You Think

Ira
like you said, these data is for prior subprime loans. Without the incentives for both the borrower and lender built in in todays plan. We do not know yet how the new program takes care of the Indymac redefault issues. Give it some time. Actually, lots of other analysts I am reading are way more optimistic than you are.

The Urgent Financial Crisis Facing Obama

"Then he messed-up the oath of office big time.."

Brokow said its Chief Justice who messed up the words of oath, Bama just got startled...