Open rule making

Here’s a good idea (which will never be implemented). From Bloomberg: The lack of transparency is a problem. Interested parties can’t provide relevant input at the early stages of the process. Banks and their lobbyists get an advantage because they are able to secure far more frequent private meetings with Fed officials than less well-heeled […]

Central margin custodians

This is a new (so far as I know) idea that I had over the weekend. The essential motivation is that OTC derivatives central clearing does some good things, such as impose a margin discipline, but some bad ones too, such as splitting OTC derivatives portfolios into cleared and uncleared pieces (and indeed into pieces […]

Tax structuring and reputational damage

Back in March 2009 I wrote: The Guardian had another set of articles on Barclays’ tax structuring group yesterday. The point is not whether the practices of this group are legal. Some may be; some are borderline; some may not be. The point is the continuing reputational damage being done to the Bank … And […]

The old and the new

Back to finance tomorrow I promise but meanwhile… I love the fact that someone is thinking of using Kickstarter to fund a new translation of Antigone. OK, she might not have a novel take on the Tycho von Wilamowitz-Moellendorff problem (you knew I had to hit up the big T W-M, right?), but using a […]

Never shoot into the sun…

… or so they say.

The full Argentina (and other options)

Try playing So, what would your plan for Greece be?; it’s fun and insightful. I got 52 the first time around, 5 the second. Interestingly reading the comments, those, 53, and 10 seem to be the most popular answers, with the full Argentina leading. My favourite comment though was the suggestion that the game should […]

CVA securitization

When the RMMG (as it then was) issued the CVA capital rules in Basel 3, I said that they would lead to a number of capital arbitrage deals. Street talk was that the Swiss were first off the blocks; now we learn from Euroweek (HT FT Alphaville) of a deal by RBS: Royal Bank of […]

Another hybrid for equity swap

Standard procedure, this, for European banks these days. Bloomberg reports: Commerzbank AG (CBK) will ask investors to swap hybrid capital instruments trading below face value for new shares, adding to steps by Germany’s second-largest lender to boost its financial strength. The measures, announced as Commerzbank unveiled earnings that beat analyst estimates, could boost the German […]

Is creditor discipline of large banks possible?

My main concern about last week’s idea from Interfluidity of government inflation linked savings accounts was the impact it would have on bank funding. Essentially I was worried that fewer deposits at banks meant more repo/CP funding. Now I notice that this is a design rather than a feature: Frankly, it’s better if more bank […]

Winter sun

Sunday in the woods: (The negative was a little over-exposed, but the scanner still found quite a bit of detail. I quite like the effect.)

Starter savings accounts

From Steve Randy Waldman at Interfluidity, a typically intriguing and thoughtful post: The Federal government should offer inflation-protected savings accounts to individual citizens, but with a strict size limit of, say, $200,000. These accounts would work like bank savings accounts, and might even be administered by banks. But deposits would be advanced directly to the […]

Twenty times better

From the FT: US regulators are poised to increase 20-fold the amount of derivatives a company can sell before it is subject to strict new rules for the biggest traders, softening a significant plank of financial market reform… The CFTC which has proposed the definition along with the Securities and Exchange Commission, is set to […]

Let’s try to get along

A minor spat in the finance blogosphere – no one died. This is hardly news I know. But for me this fight is unnecessary; both parties have some of the truth. John Cochrane first – his tagline is As long as some firms are considered too big to fail, those firms will take outsized risks. […]

A gift from Hereford for Moody’s

The last post, BTW, was no. 1,500. Thank you wordpress for your sterling service over one and a half thousand posts. Now to substantive if not entirely serious matters. You see, I was musing given all the furore over Moody’s placing us on negative outlook, shouldn’t we really teach them not to mess with sovereigns? […]

Would have vs. did

The Libor probe is heating up. Bloomberg reports: Global regulators have exposed flaws in banks’ internal controls that may have allowed traders to manipulate interest rates around the world, two people with knowledge of the probe said. Investigators also have received e-mail evidence of potential collusion between firms setting the London interbank offered rate, said […]

So many choices (but none of them are good)

No, dear reader, not my Valentine’s day, but rather macroeconomic models. Volker Wieland and Maik Wolters has a nice post on VoxEU where they look at the performance of a goodly number of the leading macroeconomic models. This picture in particular struck me: In other words, of the models studied, none – zero, nada, niente […]

Regional CCPs: How compelling a business case?

From a very nice article by Corinna Athanasopoulos from Sapient Global Markets (HT Bill Hodgson), a summary of the current state of OTC derivatives central clearing:

The best of #FedValentines

This was amusing… @justinwolfers: You’re my long-run target; my nominal anchor. @SFFedReserve: I’m going to extraordinary measures to increase your stimulus @AtlantaFed: I long for you as the economy longs for its long-run maximum potential @PhiladelphiaFed: Her deviations are never standard, her probabilities never mean. @PhiladelphiaFed: My initial projections never forecast someone like you would […]

Horizontal flips

One of the easy mistakes you can make scanning film (you know, film, one of the few things that Kodak makes money on) is that you can flip the horizontal when scanning. It’s really interesting how this effects pictures. Some things are more or less the same flipped, or at least both ways round make […]

IQ test question

What is the next item in the list: 300; 600; 1,200; 1,600; ? The series is, of course, how much client money was estimated to be missing from MF Global as time went on…