Comments on: A “Principles” and “Principals” Meeting on “Bad Bank” http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/ Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Tue, 14 Feb 2012 22:30:38 +0000 hourly 1 http://wordpress.org/?v=3.0.5 By: M.G. in Progress http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142716 M.G. in Progress Fri, 30 Jan 2009 14:50:12 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142716 When we will have a meeting on "good banks", just call me along with Prof. W. Buiter http://mgiannini.blogspot.com/2009/01/good-bad-and-ugly-bank-solution.html When we will have a meeting on “good banks”, just call me along with Prof. W. Buiter

http://mgiannini.blogspot.com/2009/01/good-bad-and-ugly-bank-solution.html

]]> By: usphoenix http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142651 usphoenix Fri, 30 Jan 2009 06:15:45 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142651 As an aside, you're earlier article used the term "wrap approach". I can't find a definition for that. OK, so I'm out of touch. What exactly is the wrap approach, as a term? Thanks As an aside, you’re earlier article used the term “wrap approach”. I can’t find a definition for that. OK, so I’m out of touch. What exactly is the wrap approach, as a term?

Thanks

]]> By: usphoenix http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142638 usphoenix Fri, 30 Jan 2009 04:35:30 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142638 WOW! Congrats BR. You've become an insider. Perhaps because you've got the strongest blog in the universe populated by more smart people than I could have ever hoped to share words with. And I've known more than one Nobel prize winner. It's a trap. And a cover for how bad things really are. It simply amplifies how KNOWING and DESPERATE. You make it pretty obvious with your word count what's going on. Hopefully we've at least evolved beyond job creation. If anyone ever uses that metaphor again, I will be forever cynical beyond redemption. As if. I think the right start is honesty about the failure of the constant growth model. I wouldn't say Malthusian just yet. That's an old term. But if anyone thinks the US is going to survive much longer on a growth model they need to think again. Sure China went some places recently they have not been before based on their new "capitalism" model. But that model was a fraud based on US consumption. When US citizens achieve the China labor level soon, China won't be able to export anything to us. And our citizens will be the worse for it. So, I would say the choices are pretty simple. Our system is complete and totally corrupt (USphoenix.net About). I've been there for twenty years. Would we like a chaotic and violent collapse, or a managed wealth sharing one? The smart trillionaires have figured this out. The cheapskate billionaires have not. God help us all. WOW! Congrats BR. You’ve become an insider. Perhaps because you’ve got the strongest blog in the universe populated by more smart people than I could have ever hoped to share words with. And I’ve known more than one Nobel prize winner.

It’s a trap. And a cover for how bad things really are. It simply amplifies how KNOWING and DESPERATE.

You make it pretty obvious with your word count what’s going on.

Hopefully we’ve at least evolved beyond job creation. If anyone ever uses that metaphor again, I will be forever cynical beyond redemption. As if.

I think the right start is honesty about the failure of the constant growth model. I wouldn’t say Malthusian just yet. That’s an old term. But if anyone thinks the US is going to survive much longer on a growth model they need to think again.

Sure China went some places recently they have not been before based on their new “capitalism” model. But that model was a fraud based on US consumption. When US citizens achieve the China labor level soon, China won’t be able to export anything to us. And our citizens will be the worse for it.

So, I would say the choices are pretty simple. Our system is complete and totally corrupt (USphoenix.net About). I’ve been there for twenty years.

Would we like a chaotic and violent collapse, or a managed wealth sharing one? The smart trillionaires have figured this out. The cheapskate billionaires have not. God help us all.

]]> By: johnbougearel http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142573 johnbougearel Thu, 29 Jan 2009 22:57:50 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142573 Barry, did you mean to attribute this to Graham Fisher's Josh Rosner? ~~~ <B>BR</b>: Yes, Josh is going to be regular contributor here, and we have yet to set him up with a new ID and password I look forward to seeing a lot fo great stuff from Josh in the future . . . Barry,

did you mean to attribute this to Graham Fisher’s Josh Rosner?

~~~

BR: Yes, Josh is going to be regular contributor here, and we have yet to set him up with a new ID and password

I look forward to seeing a lot fo great stuff from Josh in the future . . .

]]> By: F. Horne http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142566 F. Horne Thu, 29 Jan 2009 22:47:42 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142566 The first strategic decision that Geithner, Bernanke et al come to is: 1. Do we save the biggest and most troubled banks by buying a large enough portion of their bad paper? OR 2. Do we save the banking system by triaging between the basket bases and the going concerns, and capitalizing the going concerns? And let the basket cases go into administration. No one knows how to properly make this decision until we let the sun shine on the banks' books. It appears right now that no one knows what is on these banks books. Therefore, they can game the system by getting their foot in the door for tens of billions of dollars (think AIG)--which sets the hook in Charley Tuna's mouth--after which they come back to the well to get paid for all the other bad paper they didn't show in the first place. If the truth about what is on the books were known, then would it not become clear that the price is simply too high to do an aggregator bank, without first doing triage on who survives? The United States is being piecemealed to death--we need to make the banks show their hands. The government has to find out what is what, and not simply let the banks keep their secrets. Why not declare straight away that eligibility for government assistance begins with a full disclosure of liabilities--then the triage and the aggregator bank proceed from that knowledge. The US knows at that point how much of the Nation's credit will be required to have an efficient and effective solution. But if the banks get to keep hiding the ball, the US will simply be piecemealed along, trying to find out by indirect means (TED spreads etc) whether its actions are doing any good. Let's see what they've got. Then act. F. Horne....... a mere citizen The first strategic decision that Geithner, Bernanke et al come to is:

1. Do we save the biggest and most troubled banks by buying a large enough portion of their bad paper?

OR

2. Do we save the banking system by triaging between the basket bases and the going concerns, and capitalizing the going concerns? And let the basket cases go into administration.

No one knows how to properly make this decision until we let the sun shine on the banks’ books. It appears right now that no one knows what is on these banks books. Therefore, they can game the system by getting their foot in the door for tens of billions of dollars (think AIG)–which sets the hook in Charley Tuna’s mouth–after which they come back to the well to get paid for all the other bad paper they didn’t show in the first place.

If the truth about what is on the books were known, then would it not become clear that the price is simply too high to do an aggregator bank, without first doing triage on who survives? The United States is being piecemealed to death–we need to make the banks show their hands.

The government has to find out what is what, and not simply let the banks keep their secrets. Why not declare straight away that eligibility for government assistance begins with a full disclosure of liabilities–then the triage and the aggregator bank proceed from that knowledge. The US knows at that point how much of the Nation’s credit will be required to have an efficient and effective solution. But if the banks get to keep hiding the ball, the US will simply be piecemealed along, trying to find out by indirect means (TED spreads etc) whether its actions are doing any good.

Let’s see what they’ve got. Then act.

F. Horne……. a mere citizen

]]> By: AJS http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142527 AJS Thu, 29 Jan 2009 21:00:24 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142527 An outsider would take one look at want to change the rules of the game. They definitely don't want to hear what folks like TBP commenters have to say. An outsider would take one look at want to change the rules of the game. They definitely don’t want to hear what folks like TBP commenters have to say.

]]> By: inquiringmind http://www.ritholtz.com/blog/2009/01/a-%e2%80%9cprinciples%e2%80%9d-and-%e2%80%9cprincipals%e2%80%9d-meeting-on-%e2%80%9cbad-bank%e2%80%9d/comment-page-1/#comment-142501 inquiringmind Thu, 29 Jan 2009 19:47:45 +0000 http://www.ritholtz.com/blog/?p=17558#comment-142501 Regarding the issue of having/hiring insiders for these positions: could it be that since they are in such a crisis mindset that they fear hiring/appointing an impartial outsider because bringing the impartial outsider up to speed on just the bureaucratic machinery alone would take time which no one thinks they have? (I'm sure the above is the reason for the eventual failure of all bureaucracies. Knowing the rules of the game becomes more of a job than knowing how to play the game...and eventually there is no one left who can step in & just play the game). We are probably doomed. Regarding the issue of having/hiring insiders for these positions: could it be that since they are in such a crisis mindset that they fear hiring/appointing an impartial outsider because bringing the impartial outsider up to speed on just the bureaucratic machinery alone would take time which no one thinks they have?

(I’m sure the above is the reason for the eventual failure of all bureaucracies. Knowing the rules of the game becomes more of a job than knowing how to play the game…and eventually there is no one left who can step in & just play the game).

We are probably doomed.

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