China Offers US Economic Advice

Posted on June 23rd, 2008 by Tom Groenfeldt

Ah, sweet revenge. Chinese leaders are offering the US advice on how to run its economy, and a bit of criticism on its performance so far, reports Edward Wong in The New York Times. The Chinese have called America’s concept of economic regulation “warped,” and called on the country to halt the dollar’s decline. America […]

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Banking Needs Big Bonuses — For Supervisors

Posted on June 5th, 2008 by Tom Groenfeldt

Ah, here is a fresh idea from Charles Goodhart and Avinash Persaud  in the FT: give bank supervisors hefty bonuses that pay out over five years or so if the firms in their purview stay profitable.
Next on their menu is a revision to Basel II capital adequacy requirements that raises them by a ratio linked […]

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Banker’s Compensation Plans up for Review

Posted on June 3rd, 2008 by Tom Groenfeldt

Deutsche Bank’s CEO Josef Ackerman touched off a storm a few weeks ago as chair of the Institute of International Finance when a working paper there suggested revisions to mark-to-market because values in an illiquid market “results in valuations that do not provide a true picture of the financial positions of the firms.” Meanwhile the […]

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Mark to Market Debate Continues

Posted on March 20th, 2008 by Tom Groenfeldt

The Letters page in the Financial Times has become quite interesting in recent weeks  On 20 March, the president of the CFA Institute, Jeff Diermeier, defended fair value reporting, i.e. mark to market.
 “Recent market problems stemming from a lack of transparency in subprime lending and securitisations based on such loans have added a new urgency […]

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Bear Stearns: let’s blame Basel

Posted on March 18th, 2008 by Sherree DeCovny

While the nation was embroiled in the Spitzer scandal, a fire sale was in the works. JPMorgan Chase bought Bear Stearns for bupkas – $2 a share, to be exact – the latter having been hit big time by the sub-prime debacle and credit crunch. The Federal Reserve provided special financing for the deal, and […]

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Reuters to the Rescue?

Posted on March 12th, 2008 by Tom Groenfeldt

When no active market exists, how do you value assets? Reuters is promoting a plan to develop industry consensus pricing for derivatives and complex securities – see my article in Securities Industry News 10 March.
Philippe Carrel, EVP and global head of business development at Reuters, calls the service, announced on 28 January, an open pricing-model […]

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