As readers of the financial press may recall, there was a kerfluffle over the fact that Greece had used a currency trades designed by Goldman in 2001 to mask the level of its indebtedness and secure Eurozone entry. A much bigger and more costly shoe of the same type has dropped in Italy and it directly implicates the current ECB chief, Mario Draghi.
Read more...Yves here. Readers may recall that Gary Gensler, the head of the Commodities Futures Trading Commission, is being pushed out by Obama. His planned replacement is so appallingly lightweight (oh, and formerly in a very junior role at Goldman) as to assure that all she’ll be able to do is take dictation from financial firm lobbyists.
But Gensler may be having a last laugh before he leaves office.
Read more...Yves here. This article, part of an ongoing AlterNet series, ‘The Age of Fraud,’ edited by Lynn Stuart Parramore, does the difficult and important feat of unpacking a financial structure that blew up a lot of municipalities in layperson-friendly terms. It also proposes some sound reform ideas. Circulate to friends and colleagues, particularly in communities that have been on the losing end of bad Wall Street deals.
Read more...Jefferson County’s sewer system train wreck is now looking an awful lot like the periphery country in Europe mess.
Read more...By Sasha Breger, a lecturer at the Josef Korbel School of International Studies at the University of Denver and author of the recent book Derivatives and Development. Her research includes global finance, derivatives, social policy, food, and farming. Cross posted from Triple Crisis
In my last two posts (http://triplecrisis.com/a-great-sucking-sound-part-2/, http://triplecrisis.com/a-great-sucking-sound-part-1/), I addressed the roles of debt, farmland acquisition, and physical commodity hoarding in helping finance siphon wealth from global agriculture. In this final post, I discuss the role of derivatives and insurance markets in this redistributive process.
Read more...Obama is no longer bothering to pretend that he is anything other than a stooge for banks and other big money interests.
Read more...Lordie, the market upset we’ve had over the past week plus over Bernanke using the T, as in “tapering” word, is escalating into a full-blown hissy fit. We now have the Wall Street Journal and other finance-oriented venues telling us how unbelievably important today’s job report is. Huh? One jobs report is just another in a long series of data points.
So why has this one been assigned earth-shaking importance?
Read more...Now before anyone gets excited about the specter of bankers doing a perp walk, the early word in a Wall Street Journal story on criminal charges being readied against former Barclays bankers says that the prosecutions will target “midlevel traders.” This exercise thus continues the established pattern of small fry serving as human shields for managers and executives.
Read more...Josh Rosner of Graham Fisher testifies before a subcommittee of the House Financial Services committee today on why Dodd Frank has not ended too big to fail, but also has managed to entrench the megafirms’ advantaged position.
Read more...Good progressives like MoveOn, New Bottom Line, the Alliance of Californians for Community Empowerment, AFR, Elizabeth Warren, and Richard Trumka, head of the AFL-CIO have all fallen in line with Obama’s nomination of Mel Watt, Representative from Bank of America North Carolina.
It might help if they looked harder at Watt. If they were honest about it, there’s not much to like.
Read more...By Lynn Parramore, a senior editor at Alternet. Cross posted from Alternet
The LIBOR price-fixing scam has cost at least $110 million — in the state of Oregon alone!
Read more...Yves here. I had really wanted to write this piece, but Lynn Parramore beat me to the punch. There’s been almost universal enthusiasm for Brown-Vitter, legislation proposed by Sherrod Brown and David Vitter to get tough with the too-big-to-fail banks. The legislation is sufficiently stringently written that if it were enacted (big if), it would force the banks to make changes to maintain anything remotely resembling their previous profit margins. Goldman and Morgan Stanley would probably drop their banking licenses and the other US systemically dangerous banks would presumably downsize by hiving off major operations.
So what’s not to like? The problem is that the enthusiasts haven’t looked behind the curtain. This bill is being pushed, hard, by big insurers, who would be major winners.
Read more...It’s been far too long in coming, but Jamie Dimon may finally be getting his comeuppance.
Read more...Wow, did I miss it? Didn’t we have a crisis just a bit over four years ago? And wasn’t one of the big drivers the fact that banks were overlevered and took on too much risk?
Well, not only do we seem to be rerunning that playbook, banks are using strategies right under regulators’s eyes last time around to create phony capital. Worse, are pulling the exact same tricks they did last time around. Worse, regulators seem to be doing nothing to stop it.
Read more...Last week, Simon Johnson pumped for Gary Gensler, now chairman of the CFTC, to become the Deputy Treasury Secretary. Frankly, it would have been better if Gensler were Treasury secretary (an idea Johnson also promoted), but we are past that point. Obama is serious about selling catfood futures via deficit scaremongering, and he’s tagged budget maven Jack Lew as his perfect front man.
Gensler, along with Sheila Bair, has been one of the few financial services regulators who has stood up to industry demands and scored some wins.
Read more...