asterisk2a + derivatives   53

Keiser Report: Gold & World’s Debt Problems (Summer Solutions series E940) - YouTube
deflationary trap/liquidity trap - orthodox monetary policy w austerity = stagnation. & west is exporting deflation. // if it is good for consumers ... break up banks. // hedging is BS ... you double the system you double the risk. [...] banks are now bigger! ... ban most derivatives, and reintroduce glass stegall // Black-Schoeles - there is no such think as risk free rate and no such thing as the past reflect the future. risk is not equally distributed. [...] VAR is flawed. //
deflation  deflationary  NIRP  currency  war  currency  debasement  ZIRP  QE  Helicopter  Money  secular  stagnation  western  world  Abenomics  BOE  BOJ  Fed  ECB  economic  history  Richard  Koo  liquidity  trap  debt  overhang  balance  sheet  recession  consumer  debt  household  debt  mortgage  mortgage  market  mortgage  rates  distortion  hunt  for  yield  credit  boom  credit  bubble  PBOC  China  reflate  reflation  squeezed  middle  class  wage  growth  income  growth  income  distribution  income  disparity  working  poor  Precariat  Brexit  GFC  too  big  to  jail  productive  investment  underinvestment  austerity  history  productivity  gap  financial  instruments  investment  banking  global  economy  globalisation  globalization  derivatives  output  gap  productivity  recovery  neoliberal  neoliberalism  Chicago  School  neoclassical  economics  deregulation  Wall  Street  speculative  bubble  property  bubble  Beton  Gold  Betongold  stagnation  aggregate  demand  aggregate  demand  short-fall  too  big  to  bail  too  big  to  fail  TBTF  complexity  systemic  risk  systemrelevant  systemicrisk  systemrelevanz  zombie  bank  zombie  banks  non-performing  loan  leverage  hedge  Glass-Steagall  Black-Scholes  Equation 
july 2016 by asterisk2a
Bancopalypse 2.0 - Some Disturbing Figures From The Looming Financial Crisis | Zero Hedge
Well-capitalized banks are supposed to have double-digit capital levels while making low risk investments.

Deutsche Bank, on the other hand, has a capital level of less that 3% (just like Lehman), and an incredibly risky asset base that boasts notional derivatives exposure of more than $70 trillion, roughly the size of world GDP.

Even the IMF has stated unequivocally that Deutsche Bank poses the greatest risk to global financial stability.

And the IMF would be right… except for all the other banks.

Because, meanwhile in Italy, nearly the entire Italian banking system is rapidly sliding into insolvency.

Italian banks are sitting on over 360 billion euros in bad loans right now and are in desperate need of a massive bailout.

IMF calculations show that Italian banks’ capital levels are among the lowest in the world, just ahead of Bangladesh.
Deutsche  Bank  derivatives  financial  instruments  BaFin  BuBa  European  Bank  Supervision  Italy  Spain  stresstest  PIGS  zombie  zombie  banks  non-performing  loan  capital  reserves  ECB  MarioDraghi  sovereign  debt  crisis  economic  history  Wolfgang  Schäuble  Angela  Merkel  banking  union  systemic  risk  systemicrisk  systemrelevant  systemrelevanz  TBTF  toobigtofail  too  big  to  bail  too  big  to  fail 
july 2016 by asterisk2a
"Deutsche Bank Poses The Greatest Risk To The Global Financial System": IMF
via Keister Report - // a Italian banking crisis could topple them. that is why they (their economist) called for a EU bank bailout (shore up). //&! IMF Warns Of "Global Contagion" From Italy's Bank Crisis; Forecasts Two-Decade Long Recession - - [...] "Unless asset quality and profitability problems are addressed in a timely manner, lingering problems of weaker banks can eventually weigh on the rest of the system," //&! //&! Analyst Warns Deutsche Bank's Problems May Now Be "Insurmountable" - - [...] we believe DBK is still over 40x levered. [...] Seeking outside capital is also likely to be difficult as management would likely find it hard to offer any type of return on new capital invested. //&! its known balance sheet - - 1.74 trillion balance sheet!
Italy  Germany  derivatives  Deutsche  Bank  BuBa  BaFin  Wolfgang  Schäuble  Angela  Merkel  investment  banking  systemic  risk  systemicrisk  systemrelevant  systemrelevanz  European  Bank  Supervision  stresstest  contagion  repo  trust  sovereign  debt  crisis  PIGS  Greece  Brexit  non-performing  loan  zombie  banks  zombie  austerity  secular  stagnation  recession  ECB  MarioDraghi  ZIRP  NIRP  QE  hunt  for  yield  asset  allocation  distortion  OMT  LTRO  Basel  III  Basel3  leverage  banking  union  Bank  Oversight  banking  crisis  banking  system  interbank  lending  overnight  deposit  facility 
july 2016 by asterisk2a
‘The City’, by Tony Norfield - Banking as seen from the belly of the beast
[ current account deficit only affordable (thus also living standards) bc of City of London ] This is a man who writes without irony about “financial parasitism”. In The City: London and the Global Power of Finance, he seeks to document just how the UK and the US extract their pound of flesh from the rest of the world by dominating the financial flows that make international trade possible.

He argues that London’s leading role in foreign exchange trading, derivatives and overseas lending is an extension of its imperialist past. Creating complex financial products and charging for them has enabled the sector to requisition for the UK and London — and, of course, bankers themselves — a disproportionate share of the benefits of global trade. [...] [ extracting value from around the world channelling it back ] &! Novara Media interview -
Brexit  City  of  London  banking  business  investment  banking  current  account  deficit  GBP  derivatives  financial  product  financial  services  Global  Finance  British  Empire  Imperialism 
june 2016 by asterisk2a
Investigating Deutsche Bank’s €21 Trillion Derivative Casino In Wake Of Admission It Rigged Gold And Silver
Deutsche Bank has over €515 billion in “positive derivative values” in comparison to €496 billion in “negative derivative values”.
Deutsche  Bank  investment  banking  derivatives  Financial  Stability  Board  European  Bank  Supervision  ECB  too  big  to  fail  too  big  to  bail  TBTF  OTC  Greed 
april 2016 by asterisk2a
The Fed Sends A Frightening Letter To JPMorgan, Corporate Media Yawns
At the top of page 11, the Federal regulators reveal that they have “identified a deficiency” in JPMorgan’s wind-down plan which if not properly addressed could “pose serious adverse effects to the financial stability of the United States.” Why didn’t JPMorgan’s Board of Directors or its legions of lawyers catch this?

It’s important to parse the phrasing of that sentence. The Federal regulators didn’t say JPMorgan could pose a threat to its shareholders or Wall Street or the markets. It said the potential threat was to “the financial stability of the United States.” [...] “…the default of a bank with a higher connectivity index would have a greater impact on the rest of the banking system because its shortfall would spill over onto other financial institutions, creating a cascade that could lead to further defaults. High leverage,
corporate  media  media  conglomerate  too  big  to  bail  too  big  to  fail  too  big  to  jail  TBTF  jpmorgan  jpmorganchase  USA  GFC  recovery  liquidity  trap  repo  liquidity  squeeze  economic  history  Financial  Stability  Board  FinancialCrisisInquiryCommission  crisis  crony  capitalism  Greed  shareholder  capitalism  profit  maximisation  profit  maximization  investment  banking  retail  banking  leverage  CDS  engineering  CDO  MBS  subprime  FDIC  complexity  Fed  Janet  Yellen  Wall  Street  reflate  reflation  derivatives  credit  bubble 
april 2016 by asterisk2a
Georg Schramm: Wir leben in einem großen Krieg! | 3sat 14.02.2016 - YouTube
warren buffet - war between super rich and poor, // Donald Trump is symptom // - Heinrich Heine (1797-1856) - Weltlauf !!! //&!
refugee  crisis  Angela  Merkel  warrenbuffet  Warren  Buffet  Super  Rich  1%  plutocracy  oligarchy  squeezed  middle  class  GFC  derivatives  crony  capitalism  free  market  self-regulation  Gini  coefficient  East 
march 2016 by asterisk2a
Keiser Report: Sovietization of capitalism (E723) - YouTube
BIS 100% of private debt and finance sector larger than 3.9% of economy bad ... and siphoning off talent from more productive fields of work. And finance favours lending to property and land (low productivity). [...] financial products (derivatives) do not help economy. is just a financial product, fee collection. rentier! rent-seeking behaviour! fees fees fees. (JP Morgan, 89% of profits, see interview) [...] QE reflated asset prices/share prices! // In the second half, Max interviews David Graeber about his new book, The Utopia of Rules: On Technology, Stupidity and the Secret Joys of Bureaucracy.
private  debt  consumer  debt  household  debt  BIS  Wall  Street  recovery  zombie  banks  car  loan  credit  card  debt  student  loan  debt  student  loan  Bubble  student  debt  economic  history  GFC  secular  stagnation  UK  City  of  London  USA  investment  banking  retail  banking  BOE  Fed  macroeconomic  policy  microeconomic  policy  property  speculative  bubbles  speculative  speculation  productivity  output  gap  austerity  George  Osborne  dogma  ideology  constituency  Party  Funding  vested  interest  interest  groups  mortgage  market  Housing  Crisis  Help  to  Buy  Scheme  Help  to  Save  Funding  for  Lending  Scheme  Right  to  Buy  Buy-to-Let  subsidies  subsidizing  derivatives  financial  product  rent-seeking  rentier  QE  ZIRP  NIRP  reflate  reflation  Mark  Carney  fiscal  policy  monetary  policy  Richard  Koo  book  David  Graeber  MervynKing 
march 2016 by asterisk2a
Money: The Too Big to Fail Edition by Panoply Media
Neil Irwin, author of The Alchemists: Three Central Bankers and a World on Fire, joins hosts Felix Salmon of Fusion, Cathy O’Neil of, and Slate’s Moneybox columnist Jordan Weissmann. This week is all about Neel Kashkari of the Minneapolis Fed's new solution for our too-big-to-fail banks. //!& breaking up has complexity ... financial-industrial complex! //
too  big  to  bail  toobigtofail  TBTF  retail  banking  investment  banking  VAR  discounted  risk  systemicrisk  discounting  risk  BIS  centralbanks  liquidity  trap  GFC  financial  product  recovery  TARP  UK  USA  Europe  sovereign  debt  crisis  PIGS  economic  history  book  monopsony  oligopoly  oligopol  repo  interbank  lending  complexity  financial-industrial  complex  leverage  derivatives 
march 2016 by asterisk2a
Vickers warns over weaker bank safety buffers - BBC News
[ no skin in the game ] The man charged with leading an inquiry into the future safety of Britain's banks has said Bank of England plans are not strong enough. Sir John Vickers, who led the Independent Commission on Banking (ICB) said: "The Bank of England proposal is less strong than what the ICB recommended." In a BBC interview, he added "I don't think the ICB overdid it." The Bank of England declined to comment. Specifically, it is the plans to make sure that banks have enough capital that Sir John has questioned. Capital is considered vital to a bank's safety, as it serves to protect it from sudden losses. It comes in many forms, but the most common is funding from shareholders, who expect a hefty return on the risk they are taking. The backdrop to this news is the current slump in bank share prices across Europe. Since the start of the year, European banking stocks have lost a quarter of their value. //&!
zombie  banks  retail  banking  investment  banking  toobigtofail  too  big  to  jail  TBTF  too  big  to  bail  economic  history  lobbyist  lobby  Lobbying  GFC  speculation  CDS  CDO  derivatives  Interestrateswap  financial  product  VAR  risk-management  risk  management  Greed  bonuses  bonus  financial  crisis  blackswan  Black  Swan  Career  Politicians  No  Representation  democracy  Super  Rich  1%  plutocracy  oligarchy  Wall  Street  shareholder  value  profit  maximisation  short-termism  self-regulation  regulation  deregulation  regulators  Glass-Steagall  BOE  ECB  Bundesbank  sovereign  debt  crisis  Fed 
february 2016 by asterisk2a
Jan Kregel: The Continuing Risk of Derivatives - YouTube
The other common feature that Kregel notes is that the major objective of active, global financial institutions no longer is the maximization of profits by seeking the lowest cost funds and channeling them to the highest risk-adjusted return. Rather, they are most interested in maximizing the amount of funds intermediated in order to maximize fees and commissions, thereby maximizing the rate of return on bank capital. This means a shift from continuous risk assessment and risk monitoring of funded investment projects that produce recurring flows of interest payments over time, to the identification of riskless "trades" that produce large, single payments with as much of the residual risk as possible carried by the purchasers of the package. The upshot is that most derivative packages mask the actual risk involved in an investment and increase the difficulty in assessing the final return on funds provided.
derivatives  investment  banking  retail  banking  banking  crisis  business  model  risk  aversion  ROI  VAR  CDS  Interestrateswap  financial  literacy  financial  market  financial  crisis  financial  cycle  FinancialCrisisInquiryCommission  tobin-tax  FinancialCrisisResponsibilityFee  CDO  financial  instruments  bonuses  bonus  Greed  shareholder  value  profit  maximisation  Wall  Street  economic  history  self-regulation  regulation  regulators  deregulation  Glass-Steagall  Bank  Oversight  zombie  banks  financial  product 
january 2016 by asterisk2a
BBC Documentary - The Money Trap - How Banks Control the World Through Debt - YouTube
most profitable credit card debt customers are those making just the minimum payment. ... a credit card being a statement of status! retaining customers by upgrading them regularly w higher limits, new colors, new perks (they will never use). // unsecured lending - DEFINITION of 'Unsecured Loan' A loan that is issued and supported only by the borrower's creditworthiness, rather than by a type of collateral. An unsecured loan is one that is obtained without the use of property as collateral for the loan. // revolving debt // the higher your credit limit, the more you are likely to spend. // half of his income to just serve credit card fees and interest charges (no payments towards paying down) debt ... // banks lend irresponsibly bc they know they can get away with it, or somebody else will do it! because there is not regulation. no bank oversight. //&! The Truth about Payday Loans :Young, British and Broke - //&! Gambling/Betting Shops on Highstreet.
retail  banking  investment  banking  CDO  CDS  subprime  credit  card  debt  credit  card  financial  literacy  household  debt  mortgage  market  Payday  Loans  exploitation  debt  servitude  student  loan  debt  Bubble  property  ethics  moral  beliefs  revolving  debt  consumer  debt  debtoverhang  debt  Super  Cycle  student  debt  private  debt  status  symbol  instant  gratification  status  anxiety  socioeconomic  status  zombie  consumer  consumerist  consumerism  Protection  overdraft  materialism  crony  capitalism  capitalism  NPL  NINJA  Wall  Street  profit  maximisation  shareholder  value  bonuses  bonus  financial  incentive  incentive  creditrating  credit  creditrisk  credit  score  self-regulation  Bank  Oversight  financial  instruments  derivatives 
january 2016 by asterisk2a
Banks Are Perilously Exposed to China - Bloomberg View
International banks, however, don't appear to be heavily exposed to China, at first glance anyway. Bank of International Settlements data show that their claims on Chinese banks, companies, consumers and public sector are quite manageable, though Australian and U.K. banks have extended a lot of credit in China in proportion to their total foreign assets: [...] U.K. banks' $198 billion in Chinese assets at the end of last year looks particularly threatening, especially given that HSBC and Standard Chartered both derive a significant portion of their revenue from China. This exposure is particularly problematic because a debt overhang is one of the Chinese economy's biggest problems.
exposure  China  banking  crisis  investment  banking  UK  USA  2015  credit  bubble  equity  bubble  speculative  bubbles  bond  bubble  property  bubble  asset  bubble  asset  allocation  distortion  ZIRP  PBOC  NIRP  QE  QT  2016  balance  sheet  recession  underwater  debtoverhang  VAR  excess  reserves  shadow  banking  fractional  reserve  banking  banking  Fed  BOE  London  Bank  Oversight  George  Osborne  David  Cameron  Mark  Carney  liquidity  trap  Taper  monetary  transmission  mechanism  M3  monetary  policy  monetary  stimulus  unconventional  monetary  policy  monetary  system  monetary  theory  austerity  unknown  unkown  unintended  consequences  deregulation  self-regulation  regulation  regulators  Westminster  Toff  Conservative  Party  Tories  Establishment  Privileged  speculative  speculation  derivatives  financial  repression  financial  market  financial  cycle  financial  literacy  financial  crisis  HSBC  Standard  Chartered  NPL  correction  overcapacity  AIIB  Asia  FX  reserves  centralbank  reserves  margin  trading  leverage  irrational  exuberance  hubris  panic  petrodollar  Oil  price  OPEC  global  trade  global  economy  global  growth  global  imbalances  faultlines  structural  imbalance  Impediments  debt  monetisation  debt  monetization  BIS  Germany  Japan  Yuan  RMB  devaluation 
september 2015 by asterisk2a
Der Crash ist die Lösung | SWR1 Leute - YouTube
banks still TBTF, Systemrelevant. << enabled by Own Lobby influencing Career Politicians. haftungsgarantien von ECB are no more capitalism. +++ &&& +++ If even Germany - Wirtchaftslokomotive - export meister - does still have a budget deficit, while being that country that produces more than it consumes, who else if not Germany? But still doesn't. +++ "Die Zeit der Rendite ist vorbei." +++ Schulden zu haben, man ist nicht frei. Frueher hat man das sich gekauft was man sich leisten konnte, ohne kreditkarte, ohne dispo, ohne bankkredit. +++ NEW crash will come of even bigger proportion and even more rubble to clear up afterwards than 2008/9 - GFC. +++ Always buy in tranches, dispersed over time. +++ fractional reserve banking leads to this UBER crash as we live on a planet with finite resources. Current GDP fetish needs to stop. Change of mind, thinking, course. << this is the same with Mobile Creative, future workforce, Software eats the world, UK's productivity gap.
book  GFC  Debt  Super  Cycle  jubilee  sovereign  crisis  liquidity  trap  investigative  journalism  journalismus  monetization  private  consumer  bubble  monetisation  public  household  balance  sheet  recession  PIGS  Europe  lostdecade  lost  decade  lost  generation  greatrecession  greatdepression  toobigtofail  TBTF  OTC  derivatives  systemrelevant  Systemrelevanz  toobigtojail  Career  Politicians  accountability  transparency  Politics  Democratic  Process  democracy  short-term  thinking  long-term  thinking  financial  industry  LIBOR  rigging  scandal  trust  trustagent  confidence  corporatism  crony  capitalism  Lobbying  lobbyist  lobby  revolving  door  IMF  IWF  centralbanks  economic  history  capitalism  Thomas  Piketty  ECB  EZB  OMT  faultlines  budget  deficit  structural  deficit  Impediments  structural  imbalance  history  financial  repression  New  Normal  ZIRP  NIRP  QE  Beton  Gold  property  bubble  fragile  world  fagile  financial  system  external  shock  balckswan  monetary  stimulus  hunt  for  yield  speculative  bubbles  growth  round  equity  bubble  credit  bubble  asset  bubble  bond  bubble  Island  Agentina  Japan  UK  fractional  reserve  banking  GDP  economic  model  fiat  currency  fiat  money  USA  academia  acade 
june 2014 by asterisk2a
The Chart Making The Fed Nervous | Zero Hedge "all too clear that part of the Dodd-Frank resolution authority guidelines, a bailout is no longer an option." Cyprus was the first, and will not be the last incident of bail-in solution for TBTF >> this whole this is a replay of Japan 90s and 2000s
monetary  policy  deposit  haircut  Europe  reflation  zombie  banks  BOE  banking  crisis  deflation  BOJ  Cyprus  deposit  levy  policy  folly  QE  SIFI  PIGS  UK  Error  bail-in  trustagent  austerity  greatdepression  zombie  consumer  inflation  expectation  deleveraging  IMF  balance  sheet  recession  GFC  monetary  theory  output-gap  haircut  derivatives  liquidity-trap  Troika  ECB  Insured  Bank  Deposits  political  folly  crisis  greatrecession  lostdecade  debtoverhang  FDIC  LTRO  OMT  Fed  trust  economic  history  confidence  sovereign  debt  crisis  ZIRP  USA  PIIGS  toobigtofail  POMO  Japan 
april 2013 by asterisk2a
Bank Of Japan May Buy Derivatives Next | Zero Hedge
Because having legal authority to buy corporate bonds, ETFs and REITs, in addition to everything else the Fed now buys, is apparently not enough to crush, mangle and suicide its currency, the BOJ is now considering adding yet another "asset" to its cocktail of eligible securities for purchase: those which Buffett once declared weapons of mass financial destruction - derivatives.
currency  debasement  QE  monetary  policy  2013  fiat  currency  economic  history  monetary  theory  modern  monetary  theory  derivatives  liquidity-trap  ZIRP  deflation  BOJ  currency-war  abenomics  inflation  lostdecade  Japan 
march 2013 by asterisk2a
The Exchange: Greg Smith on Leaving Goldman Sachs - YouTube
Greg Smith, author of "Why I Left Goldman Sachs," joins Rob Cox to discuss his contention that the firm's shift away from serving clients inspired his public exit from the investment bank.
fiduciary  responsibility  derivatives  Dodd-Frank  Politics  accountability  transparency  lobbyist  lobby  Lobbying  conflict  of  interest  proptrading  WallStreet  GFC  Eliot  Spitzer  Glass-Steagall  Abacus  bank  crisis  banking  crisis  banking  book  GoldmanSachs 
october 2012 by asterisk2a
Investmentbanker: Was der Libor-Skandal bei Barclays verändert hat - SPIEGEL ONLINE
Der Schock des Libor-Skandals trifft das Finanzzentrum London besonders hart. Dort hatte die Politik den Bankern immer besonders lange Leine gelassen, weil das Land außer der Finanz- nun mal nicht mehr viel andere Industrie hat. Dass dieses Vertrauen so missbraucht wurde ...

Der "Tobacco Moment" der Finanzindustrie

Jede weitere Enthüllung wird die Reste des Vertrauens in die Banker zerstören - und den Regulierungswillen der Politiker stärken. Der britische "Economist" spricht angesichts der Ausmaße des Skandals von einem "Tobacco Moment" für die Finanzindustrie - einer Situation, in der sich die gesellschaftliche Stimmung gegen eine Branche wendet und diese Branche mit harten Sanktionen belegt wird, wie einst bei der Zigarettenindustrie.


[...] "Die Eigenkapitalrendite kann gut auf eine einstellige Prozentzahl sinken."
- and thus the bonuses and base salary will shrink


LIBOR might be the last straw that breaks the neck of "banking"
culture  ethics  toobigtofail  CDS  derivatives  VolckerRule  proptrading  greatrecession  EBA  WallStreet  financialtransactiontax  financialtransactionfee  Europe  BaFin  deutschebank  investment  banking  UK  Politics  transparency  oversight  regulation  regulators  NYFed  BBA  FSA  BOE  LIBOR  rigging  scandal  accountability  confidence  banking  banking  crisis  GFC  bank  crisis  trustagent  trust 
july 2012 by asterisk2a
Italy Said to Pay Morgan Stanley $3.4 Billion - Bloomberg
... politicians shouldn't do such contracts. Bc politicians, treasures are not in the end accountable.
... and obviously the deal was not transparent
... these deals were not very democratic

... further several municipalities in France and Italy as well as Germany have entered various derivatives contracts to reduce debt burden - with horrible outcomes as the GFC and Great Recession and EU debt crisis unfolded.
2012  sovereign  debt  crisis  politics  governance  transparency  accountability  derivatives  morganstanley  Italy 
march 2012 by asterisk2a
The mathematical equation that caused the banks to crash | Science | The Observer
The Black-Scholes equation has its roots in mathematical physics, where quantities are infinitely divisible, time flows continuously and variables change smoothly. Such models may not be appropriate to the world of finance. Traditional mathematical economics doesn't always match reality, either, and when it fails, it fails badly. Physicists, mathematicians and economists are therefore looking for better models.

At the forefront of these efforts is complexity science, a new branch of mathematics that models the market as a collection of individuals interacting according to specified rules. These models reveal the damaging effects of the herd instinct: market traders copy other market traders. Virtually every financial crisis in the last century has been pushed over the edge by the herd instinct. It makes everything go belly-up at the same time. If engineers took that attitude, and one bridge in the world fell down, so would all the others.
herding  sociology  irrational  complexity  CDS  blackswan  economic  history  creditcrunch  greatrecession  GFC  derivatives  mathematics  Economics  Black-Scholes  Equation 
february 2012 by asterisk2a
Bloomberg’s Harper Says Bank Exposure to Europe Clouded (Audio)
Nov 16, 2011
Bloomberg reporter Christine Harper says U.S. bank investors are being kept in the dark about exposure to European sovereign default. Harper talks with Bloomberg's Ken Prewitt and Tom Keene on Bloomberg Radio's "Bloomberg Surveillance."

- ISDA - the body for CDS / Derivatives decided that greece 50% PSI (haircut) is not default,
- bc ISDA is owned by banks, if they would rule it as default scenario - everyone would have owed somebody something - which would have introduced great uncertainty, volatility, share price losses
- did it in their own interest.
= this equals to collusion in an oligopolistic market.
ISDA  CDS  derivatives  collusion  oligopol  financialmarket  Greece  default  2011  OTC  exposure  sovereign  debt  crisis  PIIGS  accounting  fraud  transparency  confidence 
november 2011 by asterisk2a
JPMorgan Joins Goldman Keeping Italy Debt Risk in Dark - Bloomberg
tied together w bungee cords

JPMorgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS), among the world’s biggest traders of credit derivatives, disclosed to shareholders that they have sold protection on more than $5 trillion of debt globally.

JPMorgan said in its third-quarter SEC filing that more than 98 percent of the credit-default swaps the New York-based bank has written on PIIGS debt is balanced by CDS contracts purchased on the same bonds.

By contrast, Goldman Sachs discloses only what it calls “funded” exposure to PIIGS debt -- $4.16 billion before hedges and $2.46 billion after, as of Sept. 30. Those amounts exclude commitments or contingent payments, such as credit-default swaps, said Lucas van Praag, a spokesman for the bank.

“Their position is you don’t need to know the risks, which is why they’re giving you net numbers,” said Nomi Prins, “Net is only as good as the counterparties on each side of the net -- that’s why it’s misleading in a fluid, dynamic market.”
jpmorgan  goldmansachs  sovereign  debt  exposure  derivatives  2011  PIIGS  CDS  toobigtofail  counterpartyrisk  citigroup  bankofamerica  boa  morganstanley  USA  Europe  lehmanbrothers  crisis  analysis  financialmarket  default  liquidity  solvency  confidence  trust 
november 2011 by asterisk2a
Frankreich: Kommunen vor der Pleite | Europa Aktuell - YouTube
CHF, EUR Credit derivative
motive, Dexia bankers who wrote that product speculated on CHF appreciation. thus higher interest payments,
derivatives  SIV  speculation  banks  bank  dexia  france  municipal  banking  product  speculative 
october 2011 by asterisk2a
Debt and Redemption (Marije Meerman, VPRO Backlight 2010) - YouTube
Debt and Redemption (Marije Meerman, VPRO Backlight 2010) - Mar 25, 2011

All over Europe, governments dressed up their accounts by buying exotic financial products from major investment banks. Then came the crash.
Debt and Redemption shows how local authorities in Italy are struggling with the disastrous aftermath of their deals. The city of Milan has decided to strike back by charging four banks with fraud. The banks, as a matter of course, deny any wrongdoing.
Marije Meerman visits Milan and the village Polino Italy and travels to the US, where she speaks to writer/journalist Matt Taibbi (Rolling Stone, Griftopia), investor/blogger Reggie Middleton (Boombustblog) and former IMF economist Simon Johnson (13 Bankers: The Wall Street Takeover and the Next Financial Meltdown).
JosephCassano  AIG  Interestrateswap  CDS  derivatives  MattTaibbi  Italy  subprime  complexity  wallstreet  Milan  goldmansachs  Greece  fraud  PIIGS  europe  ECB  history  oligopol  oligarchy  sovereign  debt  crisis  IMF  monopoly  ReggieMiddleton  speculation 
july 2011 by asterisk2a
The Problems With Derivatives Clearing -
The International Monetary Fund is out with a new paper on derivatives after the storm, and it is a strangely academic exercise for an institution that one would hope would be a bit practical. In short, the paper argues that the focus in the Dodd-Frank Act on central clearing of derivatives is not the best solution and that central clearing parties are apt to become “too big to fail.”

In particular, the article in question worries that the move to central clearing will reduce big financial institutions’ ability to “net” their gross exposure to a given counterparty. This is pretty typical among banking types, where netting is seen as a universal good. The costs of netting are rarely discussed.
Dodd-Frank  2011  IMF  regulation  reform  derivatives  politics  lobby  lobbyist  Lobbying  finance 
april 2011 by asterisk2a
EU assembly backs bank transaction tax | City A.M.
A tax that would cover transactions such as derivatives would reduce speculation and public deficits, parliament's resolution said.An 0.05 per cent tax would bring in nearly €200bn in the EU, rising to €650bn at the global level.
bank  regulation  tax  Europe  derivatives  reform  finance  2011  transactiontax 
march 2011 by asterisk2a
Neues Gesetz: Für Rohstoffspekulanten beginnt die Zeit des Zitterns |

Ihre Kompetenzen auf dem Rohstoffmarkt werden in mehrer Hinsicht verstärkt. So darf sie Positionsgrenzen über Handelsplätze hinweg setzen. Entsprechende Vorschläge für Energiekontrakte unterbreitete sie bereits. Zudem darf sie gegen mehrere Handelspraktiken vorgehen, die zuvor noch erlaubt waren. Dabei geht es um "Spoofing" und "Banging the close". Beim "Spoofing" gibt ein Händler ein Gebot mit der Absicht ab, es kurz danach wieder zurückzuziehen. Bei "Banging the close" versuchen Händler den Abrechnungspreis, der am Ende des Handelstages festgelegt wird, zu beeinflussen.
CFTC  derivatives  wallstreet  financial  regulation  reform  july  2010  usa  commodities  manipulation  market  spoofing 
july 2010 by asterisk2a
Cassano, Goldman's Cohn to Testify at Crisis Panel's Derivatives Hearing - Bloomberg
Cassano built AIG’s Financial Products unit over two decades into a business managing $2 trillion in derivative trades tied to bonds, currencies, commodities and stocks. He told investors in December 2007 that “it is very difficult to see how there can be any losses in these portfolios.”

AIG is yet to repay about $50 billion in Treasury assistance and owes about $25 billion on a Federal Reserve credit line. Goldman Sachs, the most profitable firm in Wall Street history, has paid back bailout funds with interest.

The Securities and Exchange Commission sued Goldman Sachs, the most profitable firm in Wall Street history, in April for misleading clients including ABN Amro Bank NV in CDO trades. Goldman Sachs has said the suit is unfounded.
AIG  derivatives  2007  2010  TARP  bailout 
june 2010 by asterisk2a
Fair Game - 3,000 Pages of Financial Reform, but Still Not Enough -
Certainly the banks and the Wall Street trading shops that have so richly scored in the derivatives market are happy to keep the status quo — after all, profits flourish where opacity rules. But for most of the rest of us that’s an unsatisfactory, and possibly dangerous, outcome.
regulation  Glass-Steagall  reform  2010  politics  lobby  lobbyist  Lobbying  wallstreet  derivatives  toobigtofail 
june 2010 by asterisk2a
Buffett Turns Into One More Corporate Bubble: Alice Schroeder -
Another reason the meeting offers fewer gems is that it has grown contentious. This year, two difficult issues popped up: Berkshire’s $5 billion investment in Goldman Sachs Group Inc. and Buffett’s lobbying in Washington for a special exemption to a bill regulating the derivative deals that Buffett struck shortly before the financial crisis.

Buffett could have used his position to offer moral leadership and influence the political debate on financial- services reform. Instead, he gave a vigorous defense of Goldman Sachs. He justified the technical legality of Goldman’s actions outlined in the Securities and Exchange Commission fraud suit, and was persuasive on the sentimental reasons for why he likes the company.
warrenbuffet  lobby  Lobbying  derivatives  goldmansachs  ethics  leadership 
may 2010 by asterisk2a
Blaming Rubin | Analysis & Opinion |
When he was in the Clinton administration, Rubin thought that absent a crisis, it would be politically impossible to pass new rules because of the intensity of the opposition from his former colleagues on Wall Street. He also faced disagreement from Fed Chairman Alan Greenspan, who believed that markets were essentially self-regulating, and some skepticism from his own deputy at Treasury, Larry Summers. Rubin goes into this at length in his book, noting that Summers later ridiculed the kind of comprehensive margin requirements Rubin favored as “playing tennis with wooden rackets.” The three did agree, however, that a legally ambiguous effort by the Commodity Futures Trading Corp., then led by Brooksley Born, to regulate over-the-counter derivatives could have created dangerous market uncertainty.
robertrubin  hypocrisy  hypocrite  alangreenspan  larrysummers  regulation  reform  derivatives  billclinton 
may 2010 by asterisk2a
Clinton Calls Advice He Got on Derivatives ‘Wrong’ (Update1) -
April 19 (Bloomberg) -- Former President Bill Clinton said his Treasury Secretaries Robert Rubin and Lawrence Summers were wrong in the advice they gave him about regulating derivatives when he was in office.

“I think they were wrong and I think I was wrong to take” their advice, Clinton said in an interview on ABC’s “This Week” program broadcast yesterday.

Their argument was that derivatives didn’t need transparency because they were “expensive and sophisticated and only a handful of people will buy them and they don’t need any extra protection,” Clinton said. “The flaw in that argument was that first of all, sometimes people with a lot of money make stupid decisions and make it without transparency.”

“Even if less than 1 percent of the total investment community is involved in derivative exchanges, so much money was involved that if they went bad, they could affect 100 percent of the investments,” Clinton said.
billclinton  larrysummers  robertrubin  derivatives  warrenbuffet  Lobbying  lobby  lobbyist  Fed  alangreenspan  GSE  mortage  housing  bubble  fanniemae  freddiemac 
april 2010 by asterisk2a
Economic View - In Financial Regulation, Recognize Our Limitations -
Whatever we do, let’s not be overoptimistic about how successful improved oversight will be. The financial system is diverse and vastly complicated. Government regulators will always be outnumbered and underpaid compared with those whose interest it is to circumvent the regulations. Legislators will often be distracted by other priorities. To believe that the government will ever become a reliable watchdog would be a tragic mistake.

So where does this leave us? We should plan for future financial crises, to occur at some unknown date for some unknown reason, and arm ourselves with better tools to clean up the mess.

Much focus in Washington has been on expanding the government’s authority to step in when a financial institution is near bankruptcy, and to fix the problem before the institution creates a systemic risk.

GSE government-sponsored enterprises
--- reform and regulation have unintended consequences.
--- See Duabi, backgroudn where israli gov was part-owner. lowering risk
GSE  FHA  fanniemae  freddiemac  regulation  reform  greatrecession  housing  bubble  creditcrunch  derivatives  problem  usa  systemicrisk  oversight  banking 
march 2010 by asterisk2a
Embrace reality, not fight speculation | Analysis & Opinion | Reuters
This is not an issue that will end with the euro zone. What derivative speculators on Greek debt are doing is little different at its heart than investors selling U.S. Treasuries or British gilts because they feel those countries’ deficit situations are getting out of hand. These are simply bond market vigilantes in another form.
CDS  greece  derivatives  speculation  comment  opinion  sovereign  debt 
march 2010 by asterisk2a
A Modified Bill Moves Regulatory Plan Forward -
That proposal set off criticism by Democrats and Republicans, some with close ties to the banking industry, that it was the first step toward having government bureaucrats approve and disapprove an array of products.

At a hearing on Wednesday before the financial services committee, Treasury Secretary Timothy F. Geithner said: “There has been a lot of concern that if you invest the government with the ability to decide what’s appropriate here and there, that will lead to less competition and choice. The chairman’s proposals, which I’ve had a chance to read quickly, provide a better balance of choice and protection.”

Mr. Frank said his measure would exempt various businesses — like merchants, retailers and providers of retirement plans — from oversight by the consumer financial protection agency.
CFPA  barneyfrank  timgeithner  regulation  reform  financial  banking  SEC  CFTC  derivatives  2009 
february 2010 by asterisk2a
Obama's Big Sellout : Rolling Stone
Then he got elected.

What's taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.
BobRubin  bailout  corruption  barackobama  presidency  government  usa  politics  economy  JosephStiglitz  AIG  bonuses  citigroup  campaign  TARP  history  lobby  wallstreet  lobbyist  Lobbying  larrysummers  timgeithner  goldmansachs  RahmEmanuel  barofsky  CDS  derivatives  regulation  reform  barneyfrank  LTCM  SEC  CFTC  ConsumerFinanceProtectionAgency  CFPA  coruption  FDIC  treasury 
february 2010 by asterisk2a
What the New York Fed Bought in A.I.G.’s Bailout - DealBook Blog -
In his statement releasing the document, Mr. Issa argued, “It’s not conjecture, it’s not speculation, it’s fact — the New York Fed gave a backdoor bailout to A.I.G.’s counterparties and then tried to cover it up.”
AIG  bailout  henrypaulson  assets  fed  timgeithner  documents  derivatives  MBS  subpoena 
january 2010 by asterisk2a
“Body Count From Goldman Actions Crosses Into Criminal Territory” « naked capitalism
Don't bet what you can not afford to lose.
She notes, accurately, that Goldman used AIG to hedge its bet on CDO’s, either for itself with the Abacus deals, or for its clients, with the Davis Square deal. Had AIG failed, Goldman would have been on the hook for the losses: to execute the CDO with synthetic mortgage bonds, Goldman went “long” the CDS and then turned around and went “short” with AIG, effectively taking the risk of the mortgage bonds defaulting and then transferring it to AIG.

But Ms. Tavakoli fails to note that the collapse of the CDO bonds and the collapse of AIG were a deliberate strategy by Goldman. To realize on their bet against the housing market, Goldman needed the CDO bonds to collapse in value, which would cause AIG to be downgraded and lead to AIG posting collateral and Goldman getting paid for their bet. I am confident that Goldman Sachs did not reveal to AIG that they were betting on the housing market collapse.
goldmansachs  bet  betting  aig  bailout  derivatives  CDO  mortage  MBS  toxicassets  prime  non-prime  subprime 
december 2009 by asterisk2a
How To Kill OTC Derivatives Reform in Two Sentences « The Baseline Scenario
Have lobbyists snuck another major loophole into the OTC Derivatives bill? This week the final touches are being put on Barney Frank’s financial regulation bill – H.R. 4173 – “Wall Street Reform and Consumer Protection Act of 2009.” One of the centerpieces of this reform is Title III: Over-the-Counter Derivatives Markets Act. And one of the goals of this reform would be to get as many derivatives as possible to trade on exchanges.
derivatives  regulation  finance  barneyfrank  lobby  lobbyist  Lobbying  wallstreet  reform  2009  OTC 
december 2009 by asterisk2a
Brooksley Born, the Cassandra of the Derivatives Crisis -
A little more than a decade ago, Born foresaw a financial cataclysm, accurately predicting that exotic investments known as over-the-counter derivatives could play a crucial role in a crisis much like the one now convulsing America. Her efforts to stop that from happening ran afoul of some of the most influential men in Washington, men with names like Greenspan and Levitt and Rubin and Summers -- the same Larry Summers who is now a key economic adviser to President Obama.

She was the head of a tiny government agency who wanted to regulate the derivatives. They were the men who stopped her.
BobRubin  derivatives  creditcrunch  alangreenspan  larrysummers  CDS 
august 2009 by asterisk2a

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