Blogs: Crash Course

The New York Times finally caught on today, publishing this pretty good story about the perils of bailing out Level 3 assets held by profligate banks. To recap our saga: Back in September, Treasury Secretary Henry Paulson rolled out the Troubled Assets Relief Program, fondly known as TARP, and told congress that the $700...
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A brilliant, kind, patient, and acerbic wit died Sunday after a nearly three-year bout with ovarian cancer. Doris Dungey, 47, was a Marlboro-based mortgage banker who began blogging under the name Tanta in 2006, and explained in detail what was about to take place in the financial world. Although her true identity was known...
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Last night Federal Reserve and CitiGroup officials dropped a financial bomb, emerging from all-weekend talks to say that the U.S. taxpayers are bailing out Citi. It was the inevitable result of policy decisions made a decade ago, after CitiGroup broke a 70-year-old law by merging with the Traveler’s Insurance Co. The illegal merger was...
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Neel Kashkari, the Assistant Treasury Secretary respectfully known as Treasury Secretary Hank Paulson’s Mini Me, took a mean grilling today at a House Domestic Policy subcommittee hearing, during which–according to this deftly edited YouTube video–Baltimore’s very own Congressman Elijah Cummings (D-7th) asked an impertinent question. A source close to the congressman says Cummings was...
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Bloomberg, the financial news wire, has sued the Federal Reserve under the Freedom of Information Act to find out just what the taxpayers are getting for our $1.5 trillion (so far) bailout of the U.S. financial services industry. We explained this in general a couple months ago. Now it’s time for specifics. As the...
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The Columbia Journalism Review’s Dean Starkman posted an analysis today on why we should be outraged. He points out that the AIG bailout money ($123 billion, give or take) is going straight to counterparties -including Goldman Sachs-and not even stopping at AIG long enough for a cup of coffee. But who are all these...
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If all the recent economic bailout news has got you wondering who all these bailers are and what relationships they have to the various big-bank bailees, scoot on over to MSN Money which, with the help of ProPublica, the non-profit journalism web site, has published this helpful, wheel-shaped guide called 4 Degrees of Henry...
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Dr. Evil Occupation: Fictional Villain; CEO (emeritus), Omincon Compensation: unknown Interests: space, rockets, “lasers,” sea bass with head-mounted “lasers,” world domination, etc. Demand: “100 beeelion dollars” What He Will Do If You Don’t Obey: Blow up the Earth with his moon-based “laser.” Henry “Hank” Paulson Occupation: Treasury Secretary, Fictional Economic Savior Compensation: $46.7 million...
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At the heart of the current financial meltdown is counterparty risk/failure. Many large financial institutions took heavy debt backed by questionable assets, and now they cannot pay their creditors. Those questionable assets are currently sitting on these companies’ balance sheets, labeled “Level 3,” which technically just means “difficult to value.” But, you might ask,...
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On Sept. 18, Treasury Secretary Henry Paulson announced that he would seek approval from Congress to create a new government entity to buy assets from U.S. financial firms, to relieve those companies of their debt and prevent a collapse of the Western world’s financial system. Paulson repeatedly referred to the new entity as the...
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Joke: Buy MY ShitpileIf Washington can by Their shitpile of over-valued crap (and we know who They are) then why shouldn’t Washington also buy Our shitpile too? Wonk:Prof. Andrew Lo of MITFor an insider’s view of the risk posed by hedge funds and other heavily-leveraged financial players, download this 2001 paper, “Risk Management for...
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NPR’s Morning Edition this morning reported on the causes of insurance giant A.I.G.’s downfall, letting us know that credit default swaps were “a $70 trillion business.” Reporter Adam Davidson says the credit-default swaps business soured and forced A.I.G. into an effective U.S. government receivership, which was announced late Tuesday night. But consider: Does $70...
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