Archive for July 13th, 2009

The Pettis Banking Theorem

This is from Michael Pettis’s China Financial Markets. It should probably be like the Pledge of Allegiance used to be in school, a required recitation before the meeting of any bank board of directors. I guess it is time to introduce something that I might call the Pettis Rule of Banking (although I am way, [...]

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Dependency And The Financial Markets

Floyd Norris has an excellent post up today concerning CIT and the financial system. I’d like to talk quickly about one of the points he makes. Here is what he has to say: Despite the slight opening of financial markets since the winter panic eased, this country does not have a decently functioning financial system. It [...]

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Pro And Con Views On A Second Stimulus

Based on the assumption that some of you can’t get your fill of the discussion about the need for more stimulus, here is a list from the New York Times of opinions both pro and con. It contains links so you can read to your heart’s content. For a second stimulus: Paul Krugman, Princeton economics [...]

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Auto Czar Steve Rattner Stepping Down

The head of the auto task force Steve Rattner is stepping down. He will be succeeded by his number two, Ron Bloom. Love him or hate him, in shepherding GM and Chrysler through bailouts and bankruptcy, Rattner did what many suggested was undoable. He gave the two a fighting chance to succeed when many thought liquidation [...]

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Wells Fargo’s Option ARM Problem Is Not That Bad

Via Calculated Risk, here is a post from the Healdsburg Housing Bubble which goes into some detail on the subject of Option ARMs and those in particular owned by Wells Fargo. I’ve been trying to make the point for some time that the Wells’ Option ARMs that it inherited in the purchase of Wachovia (Wachovia [...]

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A Novel Solution To The Commercial Real Estate Problem

The Financial Times has an article about one group’s plans to refinance commercial real estate. Their plan is to not refinance all of the maturing debt with more debt. They plan to use equity. The idea is to refinance existing CRE with equity raised via a REIT vehicle. The REIT would hold title to the [...]

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Arnold Kling: Recovery Will Be Fast

How about a little sunshine for a change. Keep in mind that this is opinion and flies in the face of a lot ofcurrent data but Arnold Kling is a pretty level-headed economist. Writing in The Atlantic he makes the following observations: Sudeep Reddy takes note of an important fact about the current recession: 1.  [...]

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