Category Archives: banking
Scotland Yes or NO
The clock is ticking down for a yes or no vote on Scotland’s break with Britain, and things are getting ugly. Hope the clock’s not attached to a bomb. English politicians are pulling out all the stops in Scotland to buy no votes.
Keeping the Scotch in Scotland
Even Bill Clinton got into the act to say a yes vote could be financially risky. Big banks and businesses have threatened to leave Scotland if the yes voters win. On the bright side, that’s not an option for Scotch makers.
Backdoor Wall Street Bailout
Our magic president has appointed a new Fed chief to make more magic money.
Janet Yellen’s Senate hearing for approval to succeed Ben Bernanke began yesterday.
Backdoor Wall Street Bailout
Andrew Huszar, a former bond buyer for the Fed, wrote an interesting apology in the WSJ this week for his role in “quantitative easing”.
He says that the Fed never bought a mortgage bond in its 100 year history until he was hired in 2009 to buy $1.25 trillion of the things! In a single year. According to Huszar Bernanke spun the scheme as a plan to help Main Street but it was really “the biggest backdoor Wall Street bailout of all time”.
Chairman Ben Bernanke made clear that the Fed’s central motivation was to “affect credit conditions for households and businesses”: to drive down the cost of credit so that more Americans hurting from the tanking economy could use it to weather the downturn.
QE may have been driving down the wholesale cost for banks to make loans, but Wall Street was pocketing most of the extra cash.
Bernanke’s Economy
Bad news for the economy is good news for Wall Street these days.
Yesterday Bernanke announced it was too early to taper off on his greenback spinning wheel. He’ll continue to pump $85 billion per month into the sluggish economy through quantitative easing. The magic money is conjured up when the Fed buys Treasuries and mortgage backed securities.
The sorcerers on Wall Street were pleased and stocks hit record highs.
First Rodeo
Obama’s not the first president to be mocked as a rodeo clown. I hope he’s not the last. Drew this on in 1999.
Rumpelstiltskin
Rumpelstiltskin spun gold out of straw. Fed chief alchemist Bernanke spins dollars out of…I have no idea. But Wall Street somehow got the idea that he was thinking of not doing it any more and didn’t like it one bit.
