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Yves Smith

Entries by Yves Smith

The Top 12 Reasons Why You Should Hate the Mortgage Settlement

(238) Comments | Posted February 9, 2012 | 7:46 AM

As readers likely know by now, 49 of 50 states have agreed to join the so-called mortgage settlement, with Oklahoma the lone refusenik. Although the fine points are still being hammered out, various news outlets (New York Times, Financial Times, Wall Street Journal) have details, with

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Elizabeth Warren on Way to Being Sidelined as Head of Consumer Protection Agency, Relegated to "Advisor" Role

(11) Comments | Posted September 16, 2010 | 3:14 AM

The body language of the administration has been clear from the outset on the question of whether Elizabeth Warren would get its nomination to head of the new financial services consumer protection agency. Despite the occasional public remark regarding her undeniable competence, which really amounted to damning her with faint...

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Time to Investigate Lloyd Blankfein and Hank Paulson

(8) Comments | Posted June 30, 2010 | 4:41 AM

The New York Times has unearthed a damning tidbit about the bailout of AIG:

When the government began rescuing it from collapse in the fall of 2008 with what has become a $182 billion lifeline, A.I.G. was required to forfeit its right to sue several banks -- including...
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Why Is Washington Dithering With Unemployment High?

(34) Comments | Posted June 2, 2010 | 4:09 AM

Brad DeLong points out that Ronald Reagan was far more concerned about unemployment than Team Obama (or Washington generally) is, and also took far more aggressive measures to combat it. From The Week (hat tip reader Marshall):

By the start of 1983, labor unions were frantically giving back previously-promised...
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Rahm Emanuel and Magnetar Capital: The Definition of Compromised

(50) Comments | Posted April 13, 2010 | 1:22 PM


  1. A neutron star with an intense magnetic field, capable of emitting toxic radiation across galaxies
  2. A hedge fund, the single market player most responsible for the severity of the 2008 financial crisis, through the toxic instruments it created

Rahm Emanuel:

White House Chief of Staff
Politician selected by...

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Debunking Michael Lewis' The Big Short

(25) Comments | Posted March 25, 2010 | 12:30 AM

The current number one non-fiction best seller, Michael Lewis' The Big Short: Inside the Doomsday Machine, addresses the question "Who got it right? Who saw the real estate market for the black hole it would become, and eventually made billions from that perception?" It is hailed as meeting the usual...

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SEC, Fed Alerted By Merrill of Lehman Balance Sheet Games in March 2008

(5) Comments | Posted March 18, 2010 | 8:58 PM

So which theory is it: stunning bureaucratic incompetence, wishful thinking and denial, or a cover up? Or a combination of the above?

No matter which theory or theories you subscribe to, the continuing revelations of how the SEC -- and perhaps more importantly, the New York Fed -- conducted themselves...

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NY Fed Under Geithner Implicated in Lehman Accounting Fraud Allegation

(5) Comments | Posted March 11, 2010 | 9:46 PM

Quite a few observers, including this blogger, have been stunned and frustrated at the refusal to investigate what was almost certain accounting fraud at Lehman. Despite the bankruptcy administrator's effort to blame the gaping hole in Lehman's balance sheet on its disorderly collapse, the idea that the firm, which...

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Why No Regulatory Action on Banksters' "Destabilize the Markets" Threats?

(1) Comments | Posted March 1, 2010 | 3:54 AM

We have pointed out more than once that a major impediment to reform of the financial services industry is that a small number of firms control infrastructure crucial to modern capitalism:

1. Credit is essential to any society beyond the barter stage

2. Debt markets are now at...

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Weigh in on FDIC Proposal on Executive Pay

(1) Comments | Posted February 15, 2010 | 10:49 PM

The FDIC is seeking public comment on a proposal to link bank deposit insurance premiums to the degree of risk-taking encouraged by the bank's executive compensation program. Note that this measure does not require Congressional approval. However, the FDIC board is split, which makes the public's input a much more...

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Schwarzman Says Kowtow to Banks or They Will Strangle the Economy

(15) Comments | Posted February 12, 2010 | 4:56 AM

Can someone shut these banking industry narcissists up?

The one and only time I met Steve Schwarzman was in 1986, when he and Pete Peterson had just started the Blackstone Group. I was a manager (meaning a mid level working oar) at McKinsey. We had teed up a deal...

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AIG Scandal: Fed as Chump or Fed as Crony?

(29) Comments | Posted January 28, 2010 | 5:07 PM

No matter which way you look at it, the picture that is emerging of the Federal Reserve, as revealed by the ongoing probes into its AIG bailout, is singularly unflattering.

The explanations for its actions can only support one of two interpretations: that the Fed was a chump, taken...

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