Posts filed under “Regulation”

Inside Look: Madoff Mayhem

Analysis and Discussion with University of Rochester President Joel Seligman, Also an SEC Historian

January 03, 2009

Featuring Interview with Former SEC Official Jacob Frenkel

January 02, 2009

Category: Legal, Regulation, Video

How to Repair a Broken Financial World

Here is another excerpt — part II — of the all consuming OpEd of the Sunday New York Times by Michael Lewis and David Einhorn: Excerpt: When Bear Stearns failed, the government induced JPMorgan Chase to buy it by offering a knockdown price and guaranteeing Bear Stearns’s shakiest assets. Bear Stearns bondholders were made whole…Read More

Category: Bailouts, Credit, Derivatives, Legal, Markets, Really, really bad calls, Regulation

The End of the Financial World As We Know It (and I feel fine)

The entire OpEd section of the Sunday New York Times has been taken over by an article jointly written by Michael Lewis and David Einhorn, titled The End of the Financial World As We Know It. Its this morning’s must read piece . . . Excerpt: “OUR financial catastrophe, like Bernard Madoff’s pyramid scheme, required…Read More

Category: Bailouts, Credit, Derivatives, Legal, Really, really bad calls, Regulation

Looking Ahead: Madoff, Macworld, CES

The first full week of 2009 will be a busy one in the world of business and financial news, beginning with a House hearing into the alleged Bernard Madoff ponzi scheme and ending with the unemployment report. Stacey Delo reports.

1/2/2009

Category: Markets, Regulation, Video

AIG’s Financial Products Division

I’m fascinated by this huge article in the Washington Post called The Beautiful Machine. Its about AIG’s Financial Products divisions, a hugely profitable operation specializing in derivatives, with roots in Drexel Burnham, that traces its AIG affiliation all the back to 1987. Its the first of three parts, and I’ll pull excerpts from each. Here’s…Read More

Category: Bailouts, Corporate Management, Derivatives, Regulation

Security Fraud Prosecutions Down 87% Since 2000

Some toothless watchdog: This year, the S.E.C. has brought the fewest number of securities fraud prosecutions since 1991. That’s according to the data that the Transactional Records Access Clearinghouse (TRAC), a research group at Syracuse University, has amassed. Soft on White Collar Crime, by the Numbers: • 2008 had 133 prosecutions for securities fraud (thru…Read More

Category: Bailouts, Legal, Markets, Regulation

Office of Thrift Supervision: Asshat Central

I am trying to figure out who is the biggest jerk in this story. It is a challenge, given the collection of utter clowns and ne’er-do-wells that run that office.

First, you have some moron who helped cost the taxpayers a hundred large ($100B) back in the 1980s. How this idiot ever ended up in a position of responsibility in any regulatory agency again is beyond my comprehension. There are some who would point to all government regulation as the root cause, but crony capitalism and the disbelief in and and all regulations is what leads to putting someone so unsuitable in this position of authority.

Second, you have to wonder about just how frickin’ dumb the idiots who run the office of Thrift Supervision have been the past 8 years. These were the clowns that blamed Schumer for the collapse of Indy Mac, after backdating their capital levels.  As you will see below, if the OTS weren’t incompetant boobs, Indy Mac should have been shut down months before their run!

That the OTS is run by such half-wits and morons, that they blamed a US Senator — for having the temerity to ask how much money the criminally incompetant managers running Indy Mac were going to cost the taxpayer — rather than their own inadequate supervision. (BTW, the answer to Schumer’s question was about $9 billion).

Recall that when James Gilleran took over the Office of Thrift Supervision, he took a chainsaw to a stack of regulations to symbolize how his agency was going to “cut red tape” for thrifts (a.k.a. S&Ls), which were heavily involved in mortgage lending. The ideologue in him declared: “Our goal is to allow thrifts to operate with a wide breadth of freedom from regulatory intrusion,” Gilleran said in a 2004 speech.

Nice work.

This wasn’t mere malfeasance by Gilleran — as we have been repeatedly noting, it was nonfeasance — the intentional failure to perform a required legal duty or obligation.

As for the FBI, the division in charge of enforcement, after sounding the warning bell, subsequently made a “strategic alliance” in 2007 with the Mortgage Bankers Association (MBA) the trade association for (then) major industry players like IndyMac and Countrywide Financial. Imagine if the FBI division in charge of organized crime set up a joint venture with the Cosa Nostra. That’s what this was the equivalent of at the FBI.

It all comes back to the radical deregulatory philosophy we discussed Sunday:  Appoint cabinet level people who share that same belief system, who think government can never work — and voila! –  this is what you get.

Anyone who thinks that really bad behavior in the corporate world needs no proscribing should not be put in charge of Regulatory agencies.

Excerpts after the jump . . .

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Category: Corporate Management, Legal, Markets, Regulation

1st Madoff-Related Suicide Hits the Tape

Won’t be the last one, either: Thierry Magon de La Villehuchet, who ran a fund that invested with Bernard Madoff, was found dead at his Madison Avenue office today, a New York City police officer at the scene said. The death appeared to be a suicide, he said. De la Villehuchet, 65, was a founding…Read More

Category: Hedge Funds, Legal, Markets, Regulation

What Does Regulation Regulate?

Here’s one of the simple truisms that gets lost in the political (i.e., bumper sticker) discussions. Don’t regulate the free markets! Don’t interfere with innovation! Don’t stifle incentives! What bullshit. One of the best ways to win a debate is to control the language used. This was one of the elements George Orwell was discussing…Read More

Category: Bailouts, Legal, Regulation

Regulating After the Fact

Tom Toles: via Washington Post

Category: Bailouts, Humor, Markets, Regulation