Posts Tagged ‘Elizabeth Warren’

The trouble with commercial real estate

The trouble with commercial real estate

Courtesy of Tim Iacono at The Mess That Greenspan

Elizabeth Warren, Chairwoman of the Congressional Oversight Panel, talks about the ongoing troubles that community banks are having with commercial real estate loans as detailed in the panel’s latest report on the subject released earlier today – the outlook isn’t good.  

 

 

The discussion that begins at about the 3:10 mark is pretty interesting as Fox Business News host David Asman references big Wall Street banks "having their arms twisted" to take TARP money in late-2008, a view with which Warren disagrees vehemently (I’m pretty sure she disagreed vehemently there but, admittedly, it was hard to tell).


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Elizabeth Warren Explains the Financial Crisis and the Problem with the US Banking System

Elizabeth Warren Explains the Financial Crisis and the Problem with the US Banking System

Courtesy of Jesse’s Café Américain

This is from Elizabeth Warren’s 26 January 2010 appearance on The Daily Show.

Brilliant in its simplicity and its honesty. Very tough and straight talk.

Why do we have to see this on the Comedy Central Network, and hear the usual drivel and obfuscation on the mainstream media?

Watch it. Send it to a friend.

 


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Elizabeth Warren talks about TARP

Elizabeth Warren talks about TARP

Courtesy of Tim Iacono of The Mess That Greenspan Made

The Congressional Oversight Panel’s report on TARP (Toxic Troubled Asset Relief Program) is out today and, to no one’s surprise, the results seem to be much better for Wall Street than for Main Street. Elizabeth Warrent provides an update.

 

Favorite line: "The TARP program has been really, really good at shoveling hundreds of billions of dollars into the largest financial institutions. Man, it managed to cut through the paperwork and do that on two pages, in the space of hours."

 


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Words from the Wise?

Words from the Wise?

Courtesy of Michael Panzner at Financial Armageddon

I just got back from The Economist‘s "Buttonwood Gathering" in New York and thought I’d share a few of the more interesting (and, in some cases, quite enlightening) quotes (in no particular order) from the movers-and-shakers at the (well attended) conference:

Secretary Tim Geithner, United States Department of the Treasury:

"Generally, we did not do enough." (Referring to the failure to address growing concerns over excessive risk-taking in the period leading up to the financial crisis.) [Editor's note: understatement of the year?]

Stephen Roach, Chairman, Morgan Stanley Asia:

Those who are looking for a "V"-shaped recovery are in for "a rude awakening."

"The imbalances going into the crisis were large to begin with. Now, they are bigger than ever."

George Soros, Chairman, Soros Fund Management:

"Bankers have too much power." (Referring to the hold that Wall Street has over Washington.)

The "globalization of financial markets is built on false premises: namely, that markets can be left to their own devices."

Sheila C. Bair, Chairman, Federal Deposit Insurance Corporation:

"Insured deposits are being used in ways that I don’t like to see."

Wilbur L. Ross Jr., Chairman and Chief Executive Officer, WL Ross & Co.:

People were focused on "risk-ignoring rates of return." (Describing one of the things that went helped bring about the financial crisis.)

If regulators had taken the time to visit a Countrywide Lending office, they would have seen something akin to "a Wall Street boiler room," rather than a bank branch. (Referring to regulator’s unwillingness to go out into the field and see what was really going on during the housing boom.)

"Government is its own systemic risk in the mortgage market."

Lawrence H. Summers, Director of the National Economic Council, The White House:

The root of most financial errors is "when you try to do today what you wished you had done yesterday."

"I can assure you that on Main Street, it is a very different conversation." (Referring to the contrast between the optimism on Wall Street and the more pessimistic mood of those struggling to get by in other parts of the country.)

"It is not the administrations’s view to bribe those who have been part of the problems


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Elizabeth Warren: “The big banks always get what they want”

Excellent interview with Elizabeth Warren. - Ilene

Elizabeth Warren: “The big banks always get what they want”

Courtesy of Edward Harrison at Credit Writedowns

Banking CEO's Testify Before House On Use Of TARP Funds

Elizabeth Warren, chair of the Congressional Oversight Panel, is certainly looks to be fighting the good fight. At the conclusion of the Buttonwood Gathering in New York on Fixing Finance, she met with Tech Ticker’s Aaron Task and gave him quite an ear full.

Listen to what she has to say about the way of the land.

On the Obama Administration’s victory lap:

  • “It is not the case people go to bed wondering if there will be an economy in the morning," she quips, but "we still have lot of serious problems."

On the banks:

  • “They have all the money; they have all the lobbyists.”
  • “I don’t understand how they can’t see that the world has changed in a fundamental way – it’s not business as usual. All I can say right now is they seem to be winning this argument.”

On housing:

  • "We see things getting worse in the housing market."
  • "We have to get foreclosures under control."

On this moment in history:

  • “This is a moment when all around the country people are saying we’ve had it about up to here with these large financial institutions that want to write the rules then take our money. I find it astonishing that they have the nerve to show up and say, ‘I’m a big financial institution. I took your money. And now I’m going to lobby against anything that might offer some protection to ordinary families in this marketplace.”

More below in the three part interview. Links below.

Source

Wall St. Is Winning: Elizabeth Warren "Speechless" About Record Bonuses – Tech Ticker

Warren: Housing Market Getting Worse – Tech Ticker

"Astonishing" That Big Banks Are Taking Taxpayer Money, Writing the Rules, Warren Says – Tech Ticker

 


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Warren: The middle class “became the turkey at the thanksgiving dinner”

Here’s a couple more from Edward at Credit Writedowns. - Ilene

Warren: The middle class “became the turkey at the thanksgiving dinner"

Holidays & Occasions

Courtesy of Edward Harrison at Credit Writedowns

Below is a YouTube clip featuring Elizabeth Warren, the chair of Congress’ oversight panel of TARP (the Troubled Asset relief Program), the bailout started by Hank Paulson and passed by Congress.  In it she talks about her fears regarding the lack of real regulatory reform in the world of finance and how this is setting up the destruction of the middle class in America.

Her argument about the shaking down of the middle class is the same one I made in the post about greed. She has long been a champion of the middle class. I recommend the compelling book she wrote with her daughter called “The Two Income Trap,” which gets at the heart of why middle class families have become so indebted in the United States.

I don’t think Warren is out to score political points (at least not against the Obama Administration as she is a Democrat). But, she is not convinced the Administration is committed to reform and has decided to speak out to help encourage a greater will to reform. To be fair, I should point out that progress on this front was made today in OTC derivatives. And Larry Summers has been waxing prosaically about the middle class as well. But, her depiction of earlier conversations with Tim Geithner are telling in regards to her worries (H/T Zero Hedge).

 

Next: Picture’s worth 10,000 Dow Points.  

Dow 10,000 vs. the jobless recovery

jobless-recovey-vs-dow-10000

Source

Walt Handelsman – Newsday

 


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Elizabeth Warren: “I’m Not Hearing the Plan” by Government to Fix the Economy

Elizabeth Warren: "I’m Not Hearing the Plan" by Government to Fix the Economy

fix it planCourtesy of Washington’s Blog

Elizabeth Warren – Chair of the Congressional Oversight Panel for the Troubled Asset Relief Program – told the Senate Committee on Banking, Housing and Urban Affairs today:

In April, the Panel looked back on the first six months of Treasury’s TARP efforts and offered a comparative analysis of previous efforts to combat banking crises in the past. We found that the successful resolution of past financial crises involved four critical elements: transparency of bank accounting, particularly with respect to the value of bank assets; assertiveness, including taking early aggressive action to improve salvageable banks and shut down insolvent institutions; accountability, including willingness to replace failed management; and clarity in the government response. Without those elements, a financial crisis is likely to create long-term economic problems.

The government, of course, hasn’t implemented any of these recommendations.

Warren told the panel:

The toxic assets remain on the books of the banks, The commercial real estate mortgages are a coming crisis. Small banks are continuing to fail. We were talking a year ago about too big to fail. We are now facing an industry that’s more concentrated than it was a year ago and too big to fail is up on us now in a much larger sense.

Until we get down to dirt, to something that’s solid, that we can put our feet on, our financial institutions are standing in a secure place, we can’t rebuild and know that we are safely past this crisis.

 


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The Parallel Reality: Nassim Taleb and Elizabeth Warren

The Parallel Reality: Nassim Taleb and Elizabeth Warren

Posted by TraderMark at Fund My Mutual Fund 

A lot of good videos out there this week; have been trying to catch up to some of them.

I often kid about the virtual world we are told to believe in of late – I use The Matrix Red Pill / Blue Pill from time to time, which amazingly seems to represent a lot of what is going on in the real world.

The term redpill was popularized in science fiction culture via the 1999 movie The Matrix. The movie relies on the premise that an artificial reality that is advanced enough will be indistinguishable from reality and that no test exists that can conclusively prove that reality is not a simulation. This ties in closely with the skeptical idea that the everyday world is illusory. In the movie, a Redpill is the term used to describe a human who has been freed from the Matrix, a fictional computer-generated world set in 1999. Bluepill refers to a human still connected to the Matrix.

… for example, when people fear for the major banks viability, create a stress test; let the banks negotiate the terms of the stress test, change the accounting rules so toxic assets no longer have to be marked to their current market value, smile for the camera, and sing happy songs. Everything is ok. And if everything is not ok, well that is fine too – the taxpayer money will always sit outside the door waiting to go inside. Which implicityly feeds on itself – invetors know its ok to invest because the government will save them, which allows the government to not to have to save them as private money floods in. See how circular it is? Free market capitalism I believe they call it. This seems to be what we see inside the Matrix.





Outside the matrix is where some of the blogosphere sits and I am reaching the point where I am not sure if those of us inside the matrix (blue pill) or outside (red pill) are the crazy ones. The madness of crowds seems to be


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Geithner To Allow Banks To Repay Tarp Although TARP Panel Says Stress Test Was Flawed

Geithner To Allow Banks To Repay Tarp Although TARP Panel Says Stress Test Was Flawed

Courtesy of Mish

In another case straight out of the Twilight Zone, Geithner will allow banks to repay TARP funds although a TARP panel advises running the tests again because the tests were so flawed.

Bloomberg is reporting JPMorgan, Morgan Stanley Among 10 Banks Repaying TARP.

JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley were among 10 lenders that won U.S. Treasury approval to buy back $68 billion of government shares, freeing them from added oversight that curbed lending practices, hiring and pay.

“These repayments are an encouraging sign of financial repair,” Treasury Secretary Timothy Geithner said in a statement today. “But we still have work to do.”

The decision to allow the biggest repayments to the Troubled Asset Relief Program reflects surging financial stocks and rising pressure from banks to free themselves of political interference. U.S. firms unveiled plans to raise more than $100 billion since government stress tests of the 19 largest banks found that 10 needed $74.6 billion of additional capital to weather a more severe recession.

In addition to JPMorgan, Goldman Sachs and Morgan Stanley, American Express Co., Bank of New York Mellon Corp., BB&T Corp., Capital One Financial Corp., Northern Trust Corp., State Street Corp. and U.S. Bancorp all said today they are repaying the funds.

The approved firms didn’t include Bank of America Corp., the biggest U.S. bank by assets, and Citigroup Inc., each of which have accepted $45 billion from the government. Wells Fargo & Co., the nation’s largest mortgage lender and the recipient of $25 billion in government aid, also wasn’t on the list.

“There will be a question that potentially overhangs some of those names that haven’t returned TARP,” said Scott Siefers, an analyst at Sandler O’Neill & Partners LP in New York. “How are you going to get out from under it and what will it mean for me? Are you going to issue more shares somewhere down the road?”

Firms buying back the government’s preferred shares also have the right to repurchase warrants the Treasury holds “at fair market value,” today’s statement said.

Of the 10 Banks approved, all but Northern Trust was on the list stress test banks. I called it a cake walk not a stress test at the time. See


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Phil's Favorites

How Does the Stock Market Bottom?

 

How Does the Stock Market Bottom?

Courtesy of 

Despite the recent selloff, things are still relatively fine. I know nobody wants to hear this right now, but the S&P 500 is still up double digits over the last year and 36% over the last three years. What has people shook, understandably, is the speed of this decline.

Depending on where stocks close today, we could be looking at a 10% haircut in just five sessions. Over the last 20 years, this only happened during the Yuan devaluation in 2015, the Eurozone crisis in 2011, the GFC (global financial crisis) in ’08 and ’09, and the dotcom bubble in ’00, &rsqu...



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Zero Hedge

NYSE Announces Disaster-Recovery Test Due To Virus Fears

Courtesy of ZeroHedge View original post here.

In a somewhat shocking sounding move, given administration officials' ongoing effort to calm the public fears over the spread of Covid-19, The New York Stock Exchange has announced it will commence disaster-recovery testing in its Cermak Data Center on March 7 amid coronavirus concern, Fox Business reports in a tweet, citing the exchange.

During this test, NYSE will facilitate electronic Core Open and Closing Auctions as if the 11 Wall Stree...



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ValueWalk

Cities With The Most 'New' And Tenured Homeowners

By Jacob Wolinsky. Originally published at ValueWalk.

Homeownership is a major investment. Not just financially, but when a person or family purchases a home, they’re investing years – if not decades – in that particular community. 55places wanted to find out which real estate markets are luring in new homebuyers, and which ones are dominated by owners that haven’t moved in decades. The study analyzed residency data in more than 300 US cities and revealed the top 10 cities with the most tenured homeowners – residents who’ve lived in and owned their home for more than 30 years – are sprinkled across ...



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Kimble Charting Solutions

Financial Crisis Deja Vu: Home Construction Index Double Top?

Courtesy of Chris Kimble

Most of us remember the 2007-2009 financial crisis because of the collapse in home prices and its effect on the economy.

One key sector that tipped off that crisis was the home builders.

The home builders are an integral piece to our economy and often signal “all clears” or “short-term warnings” to investors based on their economic health and how the index trades.

In today’s chart, we highlight the Dow Jones Home Construction Index. It has climbed all the way back to its pre-crisis highs… BUT it immediately reversed lower from there.

This raises concerns about a double top.

This pr...



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Insider Scoop

A Peek Into The Markets: US Stock Futures Plunge Amid Coronavirus Fears

Courtesy of Benzinga

Pre-open movers

U.S. stock futures traded lower in early pre-market trade. South Korea confirmed 256 new coronavirus cases on Thursday, while China reported an additional 327 new cases. Data on U.S. international trade in goods for January, wholesale inventories for January and consumer spending for January will be released at 8:30 a.m. ET. The Chicago PMI for February is scheduled for release at 9:45 a.m. ET, while the University of Michigan's consumer sentime...



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Biotech & Health

Could coronavirus really trigger a recession?

 

Could coronavirus really trigger a recession?

Coronavirus seems to be on a collision course with the US economy and its 12-year bull market. AP Photo/Ng Han Guan

Courtesy of Michael Walden, North Carolina State University

Fears are growing that the new coronavirus will infect the U.S. economy.

A major U.S. stock market index posted its biggest two-day drop on record, erasing all the gains from the previous two months; ...



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The Technical Traders

SPY Breaks Below Fibonacci Bearish Trigger Level

Courtesy of Technical Traders

Our research team wanted to share this chart with our friends and followers.  This dramatic breakdown in price over the past 4+ days has resulted in a very clear bearish trigger which was confirmed by our Adaptive Fibonacci Price Modeling system.  We believe this downside move will target the $251 level on the SPY over the next few weeks and months.

Some recent headline articles worth reading:

On January 23, 2020, we ...



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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Chart School

Oil cycle leads the stock cycle

Courtesy of Read the Ticker

Sure correlation is not causation, but this chart should be known by you.

We all know the world economy was waiting for a pin to prick the 'everything bubble', but no one had any idea of what the pin would look like.

Hence this is why the story of the black swan is so relevant.






There is massive debt behind the record high stock markets, there so much debt the political will required to allow central banks to print trillions to cover losses will likely effect elections. The point is printing money to cover billions is unlikely to upset anyone, however printing trillions will. In 2007 it was billions, in 202X it ...

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Members' Corner

Threats to democracy: oligarchy, feudalism, dictatorship

 

Threats to democracy: oligarchy, feudalism, dictatorship

Courtesy of David Brin, Contrary Brin Blog 

Fascinating and important to consider, since it is probably one of the reasons why the world aristocracy is pulling its all-out putsch right now… “Trillions will be inherited over the coming decades, further widening the wealth gap,” reports the Los Angeles Times. The beneficiaries aren’t all that young themselves. From 1989 to 2016, U.S. households inherited more than $8.5 trillion. Over that time, the average age of recipients rose by a decade to 51. More ...



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Digital Currencies

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

 

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

‘We have you surrounded!’ Wit Olszewski

Courtesy of Gavin Brown, Manchester Metropolitan University and Richard Whittle, Manchester Metropolitan University

When bitcoin was trading at the dizzying heights of almost US$2...



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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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