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U.S. Banks Relatively Safe from Dubai: HSBC Is Not

In April, HSBC raised $18.5 billion in a rights issue. Looks like they're covered.

ING Shows How Bank Dismemberment Is Done

Actually if you look what the Swiss did with UBS you'd have a better example. The gov't sold a large equity position acquired in UBS's bailout in August '09 at a profit. The US tax payer could have reaped the same reward had the gov't sold its stake or at least part a few months ago. But, perhaps politicians are most interested in keeping a stake in order to have a hand in the banks.

Mobile Phone Wars: Keeping My Distance

If VZ was smart it would charge more for leasing its network to Tracfone or just get into the business themselves.

Government Not Allowing Finance to Heal Itself

That GS (among others) has been an enormous benefactor of the government and is not subject to pay restrictions is beyond explanation. Investors and the media seem to in awe of company and not critical enough.

Goldman Sachs: 'A Hybrid Hedge Fund and Bookie'

Agreed the derivatives market is the epicenter of the bank issues. Unfortunately, unless you work in the right areas of finance, counterparty risk and banking system implications are hard to fathom, as they for the average American and even more so, the average congressman. Even if some speculative component were taken out of the derivatives market so that those who needed to hedge risk were the active parties, the issue of counterparty risk would not go away, because the derivatives market would still be huge. This business is just begging for more regulation.

Also, according to the Fed, JP Morgan is by far the biggest in derivatives, which, I believed, is still followed by Citi, which is far smaller.

Too Big to Fail: Greenspan Adds His Voice to the Break-Up Chorus

Why should the US break up the banks it considers too big to fail if other country's don't do this to their banks, like HSBC, Barclays, Banco Santander, UBS, Credit Suisse, etc. A US bank break-up would just create smaller banks that would be ripe for foreign banks to pick off, then Americans would own less of their domestic banks. Unless the G20 agrees to act alike, it would be like the saying goes, "cutting off your nose to spite your face." The ideal thing is to do what the Canadians do to their large, influential banks, regulate them tightly--there's got to be an offset to tremendous market influence.

Although a Star, Whitney Could Be Wrong on Goldman

No one knows her reasoning on this except her paid clients, also she only moved to being neutral. If you analyze the GS results, however, trading led the way, but the other operations of investment banking, etc. were acceptable, not great. Given that bonds had a huge rebound this year and Goldman was able to ride that huge wave with a higher than average beta, you have to ask yourself how repeatable this will be next year. With spreads as close as they were before the market fell apart, there's little upside. It would be hard to repeat such a performance being short next year if that's what pays off simply because of the size of the assets needed to invest. So, I believe, there's a good chance she told clients the easy money has been made this year and it will be more difficult next year, much of it is in the stock, so take your profits or don't expect a lot more upside.

Goldman Upgrades Banks - But Should We Listen?

GS's sellside equity recommendation track record has never been good. You need to question GS's motives all the time. Everyone I now in asset management jokes about placing a trade with them as to what they're doing on the other side. No one thinks this about any other firm. Investors should ask themselves is this a good time to take profits if they have them. Do you think GS's desks are selling now? Really, the best thing about GS's change of heart on large banks is the significant entertainment value is gives the markets.

SIVs: Employing All the Abuses the Credit Bubble Made Famous

A little knowledge is a dangerous thing. Yes, SIVs were leveraged and if they bought certain instruments they could be more leveraged than they appeared. But, not all the SIVs did the same thing, though if you read the papers you thought so. This is not an area of finance that the average retail investors knows much about as these instruments were sold in the private 144a world to money market funds and short term debt funds. This writer doesn't seem to be familiar with the specifics of any particular SIV. Though Cheyne is mentioned, Cheyne was not the product of an i-bank. It was a newer independent SIV run by a hedge fund out of London (that should have been a warning right there). And, yes, Cheyne bought lots of CDOs and subprime mortgages. Also, he mentions Bank of America had to buy SIV assets. Bank of America didn't have any SIVs. It had money market funds that were threatening to break the buck because of the falling price of some of their SIV paper they held (some may not have paid later), but this wasn't an SIV asset, it was SIV debt. Also, to the best of my knowledge the Citi SIVs did not buy CDOs and stopped buying US MBS in 2005. About half the assets were in better quality financial institutions. Spreads and fear in the market are most of what ultimately did the Citi SIVs in. The assets are in run-off, but have not had the detrimental impact to the bank that was feared compared to the SIVs' size. There's been a lot written about the Citi SIVs, a lot of which isn't true. And, for a fact, the investment bank did not run that Citi business.

Venezuela: How to Ruin an Economy

Need to add that the rumor in Venezuela is that Chavez is a manic depressive, known for wild and unusual swings in his personality and temperment...obviously, that's where all his diplomacy comes from.

Banks Not Buying FDIC Line on California IOUs

The banks are actually doing what there supposed to do, not take unquantifiable risks.

Biofuels: No There, There. Government Should Focus on Other Alternatives

Someone should have told the Brazilians 40 years ago that ethanol will never work. The industry there relied on subsidies and protected the industry for most of those decades, until about the past 5 years. This must have been pretty costly to Brazil, although this is never talked about. What changed for ethanol consumption in Brazil was that the auto manufacturers finally produced cars that ran well on ethanol (for several decades this was a disaster and people hated cars that ran on alcohol), the gov't gave incentives to purchase these cars, the cane producers figured out how to be more efficient.
If more ethanol is used as fuel, the price of oil will come down, and no doubt that makes the economics work against the idea. But, this isn't about economics. As was the case in Brazil, the country wants to free itself from dependency on foreign oil, as well as reduce carbon consumption. While ethanol has not yet made the case in the US for reduced carbon consumption, only be sticking with pushing for greater fuel efficiency in autos that run on ethanol (Ford already has come up with ideas) and advancing ethanol production techniques can this be achieved. If other places can do this, there isn't any reason it cannot be done in the US, but the gov't has to lead this. Just like Brazil, it never would have happened unless the gov't mandated it.

Positioning for Major Reversal in Natural Gas Prices

Since when is Denbury a natural gas company? It primarily produces oil.

Government Handling of AIG vs. GM Smacks of Favoritism

If you look over the last 40 years, the US automakers have been in decline, due to the unions and poor management. They had politicians help them out along the way. Under Reagan, the Japanese capped auto imports, and then eventually built plants here that competed well against the US auto companies. The US companies just couldn't get it right. When you add in the current bleak economic environment, which is effecting the global auto industry, they were bound to be impacted more than their non-US competitors. The Japanese could conceivable be the only manufacturers of autos in the US (and employ Americans to do it) and it would make no difference to the economy.

This is not the situation in the banking industry. While the large US banks have clear culpability, you need a domestic banking industry and you do need to have large leading banks to compete globally (otherwise we'd have the same problem the German's have, but that's another story.)

Regarding AIG, which there is no defense for, if you read the NYT last week, you saw that the bonuses in the financial group were not for the people who wrote the bad CDS, but for the people who stayed to clean up the other financial products business to wind it down orderly or dispose of it with the least pain to tax payers. Though there is not a lot of detail, some of these businesses were profitable. Giving the people incentive to stay and wind down orderly was likely preferable and cheaper than bring in new, unfamiliar people to do the same thing. But, the media and Liddy did not make this case clear.

By the way, most of CitiGroup's credit card business is run out of ND.

Colonial Properties Trust: Value in the Real Estate Apocalypse

CLP's preferred may do better than the common. The yield is good. The company can reduce the size of the common dividend but not the preferred. The preferred will rally as well when the market and company eventually recover, so investors can still make a gain.