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Tag Archives: risk

Drive the algos overseas…

The Chicago Fed has published a short paper on high frequency trading… makes you wonder how much economic activity this trading represents for the Chicago area… The fundamental issues around high frequency trading are systemic risk and investor fairness. Unfortunately this paper doesn’t address either one of those issues… From the conclusion of the paper “Controlling risk […]

Political economy collides with capitalism…

Professor Joseph Stiglitz and Spanish Ambassador to the UK Carles Casajuana argue with a Hugh Hendry (of Electica Asset Management) who is betting on the Euro currency falling and failing.  Recorded from Newsnight, 09 February 2010. (HT 0/Hedge) From Project Syndicate: ~~~ “… We have compared the performance of the best-performing and worst-performing euro-zone countries between […]

California = Libya

Fails to deliver

Bloomberg’s Brian Luke reports on the outlook for the U.S. mortgage-bond market. (running time = 1:40 minutes) Fails to deliver are a problem that the Fed have not addressed since the giant daisy chain fails problem after 9/11… Primary dealers…  financial market utilities…

Derisking the banking system

Senate hearing on prop trading – Feb 2, 2010 Source: PROHIBITING CERTAIN HIGH-RISK INVESTMENT ACTIVITIES BY BANKS AND BANK HOLDING COMPANIES Senate Banking Committee Hearing: Tuesday, February 2, 2010 , 02:30 PM 538 Dirksen Senate Office Building The witness will be: The Honorable Paul Volcker, Chairman of the President’s Economic Recovery Advisory Board. Honorable Neal […]

The bounds of derivatives regulation

The derivatives legislation adopted by the House of Representatives is a landmark… here is how Barney Franks’ staff describes the legislation: Overview Over-the-counter derivatives legislation for the first time addresses an unregulated part of the financial markets that poses a potential risk to the broader economy. This risk was more than apparent last year when […]

Taxing derivatives, excessive leverage and a jobs program

The conversations are just starting on Capitol Hill to impose a transaction tax on financial securities… Bloomberg reports that Steny Hoyer says it’s “on the table”… and Representatives like John Larson (CT – 1) want to use the tax to help get America restarted… yes… let’s get America restarted… taxing derivatives to create a jobs […]

A primer on managing interest rate risks for banks

Hard times coming… mark to fiction round 2…

BusinessWeek writes: Why This Real Estate Bust Is Different Unrealistic assumptions, layers of investors, sky-high prices, and possible fraud will make it hard to clean up the mess in commercial real estate “When Goldman Sachs (GS) sold complex bonds backed by the Arizona Grand Resort and other commercial properties in 2006, it suggested the returns […]

Wall Street and Washington is a circuit

Bill Moyers talks to Marcy Kaptur and Simon Johnson about the big banks and their capture of Washington… it’s the sad truth that they speak… excepted from an excellent interview… do listen… BILL MOYERS: Let’s look at this story that I just read from the Associated Press this week about how Treasury Secretary Geithner is […]