What Lessons Has The Economy Learned From 2008? Apparently None.

The systemic risks of financial institutions haven’t changed much since 2008.

Goldman Sachs Fraud Case

As readers are likely aware by now, Goldman Sachs was yesterday charged with fraud by the Securities and Exchange Commission.  I’ve resisted comment thus far, as I’ve been tied up with a minor crisis at work and don’t have any especial expertise in the vagaries of securities law, anyway.   But here’s what we know thus […]

Ron Paul: Obama Not A Socialist

Speaking of Ron Paul, he took the bold step yesterday of announcing that President Obama isn’t a socialist. Not in a technical sense, anyway. “The question has been raised about whether or not our president is a socialist,” Paul said. “I am sure there are some people here who believe it. But in the technical […]

Credit Cards Profiting From Haiti Disaster

HuffPo’s Laura Bassett reports, under the blaring headline “As Wallets Open For Haiti, Credit Card Companies Take A Big Cut,” that credit cards come with transaction fees. As a massive human tragedy unfolds in Haiti, relief organizations are soliciting credit-card donations through their hotlines and websites. About 97 percent of these donations will actually make […]

Banks Roll Out New Fees for 2010

Faced with new regulations limiting some especially unpopular practices, many banks will introduce different practices, also sure to be unpopular but not yet illegal, to replace them. The nation’s banks will be bombarding customers with new fees and products in 2010 as they try to replace more than $50 billion in revenue wiped out by […]

Britain Ending Checks

England is phasing out the bank check. After more than three centuries, the humble check is set to become a historic relic after British banks voted to phase it out in favor of more modern payment methods. The board of the UK Payments Council, the body for setting payment strategy in Britain, agreed on Wednesday […]

Wells Fargo TARP Payback

Wells Fargo has decided to cash in some stock and repay its TARP money.  It’s the last major bank to do so.  Liz Moyer for Forbes: For months, Wells Fargo insisted it would repay its $25 billion worth of federal bailout funding in a way that wouldn’t dent existing shareholders. Its priorities seem to have […]

Did Organized Crime Save The Banking System?

The head of the United Nations Office on Drugs and Crime has made the claim that organized crime took advantage of the financial crisis last year to effectively launder their money–thereby preventing banks from collapsing. Antonio Maria Costa, head of the UN Office on Drugs and Crime, said he has seen evidence that the proceeds […]

Obama Pay Czar Slashes Compensation for Bailed Out Firms

The top earners at the top firms bailed out by the U.S. government during the financial crisis will have their pay and bonuses drastically cut. Deborah Soloman and Dan Fitzpatrick for WSJ: The U.S. pay czar will cut in half the average compensation for 175 employees at firms receiving large sums of government aid, with […]

Stimulus Spending Doesn’t Work – Tax Cuts Do

Via Jonathan Adler, I see that world-renowned economist Robert Barro and his student, Charles Redlick, takes to WSJ to summarize their research report showing that stimulus spending doesn’t work. Oddly, take cuts do. The bottom line is this: The available empirical evidence does not support the idea that spending multipliers typically exceed one, and thus […]

Protesting Banks

Glenn Reynolds has been dutifully chronicling the efforts of those organizing “tea parties” around the land to protest government bailouts and other stuff.  Apparently, there are going to be a gaggle of them on April 15. Now, Jane Hamsher is promoting a counterweight: “On Saturday, April 11, there are going to be demonstrations all across […]

Some More Numbers on the Geithner Plan

Were you wondering if yesterday’s big rally was related to the Geithner plan? Well, it probably was. The Treasury helpfully provides an example, which I reproduce here: Step 1: If a bank has a pool of residential mortgages with $100 face value that it is seeking to divest, the bank would approach the FDIC. Step […]

Geithner Plan: TARP 2.0?

Tim Geithner takes to the pages of WSJ to flesh out his Plan for Bad Bank Assets. Our new Public-Private Investment Program will set up funds to provide a market for the legacy loans and securities that currently burden the financial system. The Public-Private Investment Program will purchase real-estate related loans from banks and securities […]

Fixing Banks Ain’t Easy

In a NYT column, Tyler Cowen argues persuasively that none of the “simple” solutions floating around, ranging from nationalization to bankruptcy to the Swedish Plan are likely to work in fixing America’s “bank holding companies.”  But, while I’m as capitalistic as the next guy (if, say, I’m sitting between Dan Drezner and Megan McArdle) I […]

Phil Gramm Destroyed Our Economy

I’ve always liked Phil Gramm. He’s a charming, self-effacing fellow and his unfortunately named “Dicky Flatt Test” always struck me as the right approach to federal spending. I was, therefore, chagrined to learn, via Steve Benen, that Gramm almost singlehandedly destroyed our economic system. Time magazine, highlighting some of those most responsible for the economic […]

Something Not Always Better than Nothing

Megan McArdle: Let’s say that TARP proponents are right and that some program to pump a great deal of money into banks is better than just letting them fail. It does not then therefore follow, as night to day, that this package–or any politically feasible package–is better than nothing. It can be true that Ideal>0 […]

The Limits of Forecasting the Impact of Policy

This one’s for you, Steve. I was searching for some information on Japan’s economic problems when I stumbled upon this snippet in an article on the global outlook at the Wharton School: In a way, Japan is especially relevant in today’s global economic crisis because of its experience with a sharp economic decline and struggle […]

Start New Banks

In the discussion section of Steve Verdon’s Obama the Fear Monger post, commentor Drew and I had a brief debate about the possibility of using TARP funds to create new banks rather than try to rescue old ones.  In today’s Wall Street Journal, Paul Romer of the Stanford Institute for Economic Policy Research makes this […]

Chinese Money

There were a number of articles that united the themes of China, money, and investment that caught my eye this morning. In the first, Keith Bradsher, writing in the New York Times, suggests that China may be losing its appetite for investing in U. S. securities: HONG KONG — China has bought more than $1 […]