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Category Archives: Trading

Goldman Sachs comes late to the game

The Financial Times ran a story Monday about Goldman Sachs becoming the first big dealer to orient its business around electronic fixed-income trading and away from “hands-on” order processing in light of new regulations coming from Dodd-Frank. The story claimed that Goldman was a pioneer in this approach: Now Goldman could be one of the first banks to […]

Glorious sunlight…

It’s so refreshing to see this lovely video of Senator Blanche Lincoln talk about her derivatives reform legislation… here is her draft… Somehow I sense the hand of CFTC Chairman Gensler in this process… and the spirit of House Agriculture Chairman Collin Peterson… yes… substantive forces to rein in Wall Street on derivatives are at […]

Extend and pretend round II

Ross Levine and Glenn Loury of Brown University argue that the 2007-2009 financial crisis is repeat of the S&L crisis  “extend and pretend” treatment of bank solvency. Expect this to become a meme soon… cause it’s true… And another important critique of extend and pretend at ZeroHedge… a comparison to the Latin debt crisis and […]

The world is running out of fiscal space

This is what global hot money sounds like… or put differently the “globalization of capital flows”… moving funds between asset classes and currencies to take advantage of changes in valuations and relative returns. Does this type of financial activity add to nation’s wellbeing or does it just represent a “skimming” of a  nation’s productive capacity? […]

Muni market confusion

Bond insurance down to 5% of new issues from 50%… BABs have reduced supply… Are credit ratings to be trusted? Municipal revenues has declined… “We don’t expect the muni market to collapse…”

Via the repo market, real banks came to resemble shadow banks

An excellent review of Yves Smith’s new book “ECONned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism” at Jesse’s Cafe Amercain… There is a very interesting bit about the shadow banking system and repos… of course no one in Washington is talking about this… “…And now we are ready for Chapter 9, where all […]

Treasury Secretary Geithner’s “Proposed OTC Act created new and significant loopholes”

From Michael Greenberger, former CFTC General Counsel, at the  Make Markets Be Markets conference. (HT Credit Risk Chronicles) Pending Derivatives Legislation and Legislative Proposals The Obama Administration White Paper In response to the catastrophic systemic failure caused by unregulated derivatives, the Obama Administration in its June 2009 White Paper proposed that all standardized OTC derivatives be subject to […]

The more transparent a marketplace, the more liquid it is, the more competitive it is

Transparency creates stability in financial markets… this is a foundational precept of our system but is rarely argued… the following is from a speech by CFTC Chairman Gensler to the “Energy Bar Association” on February 24th… ~~~ Transparent Trading Requirement “… It is not enough, though, simply to promote transparency to the regulators. Financial reform […]

Unraveling the profit puzzle at Goldman Sachs I

From PBS’s Lehrer show… ” As part of his continuing series of reports making sense of business and the economy, Paul Solman examines the inner workings of investment powerhouse Goldman Sachs and how it makes money.”

Country risk…

From FT Alphaville… ~~~ “Looks like Credit Suisse has jonied the conspiracy trying to undermine Spain. Here’s a ranking of countries by perceived risk, taking into account things like current account balances, public and private debt, and CDS spreads.  It comes from a note on the impact of sovereign risk on European banks, published on Wednesday […]