Search Results for: PPIP

Gaming the PPIP?

By James Kwak A couple of weeks ago, Yves Smith picked up on the story that the TARP Special Inspector General is investigating suspicious trades in connection with the Public-Private Investment Program. When PPIP was announced almost a year ago, … Continue reading

“Telling a lie does not make you guilty of a federal crime”

By James Kwak That’s what Jesse Litvak’s lawyer said at the start of his trial earlier today. And technically speaking, it’s true. If you’re trying to sell a bond to a client, and during the course of the conversation you … Continue reading

Five Years Later

By James Kwak Five years ago, Lehman brothers went bankrupt, AIG was nationalized, Ben Bernanke stared into an abyss, and Mohamed El-Erian asked his wife to take out as much cash from the ATM as she could. And Simon and … Continue reading

They Saved the Big Banks But Kind Of Lost The Economy Doing It

 By Simon Johnson It would be easy to take relatively cheap shots at the portrayal of Tim Geithner — “we saved the economy but kind of lost the public doing it” — in the New Yorker, out today.  Mr. Geithner … Continue reading

Move Over, Bernanke

Ben Bernanke is Person of the Year. Matt Yglesias has criticism, although he does say it was an appropriate choice. Now, the Time award is meant to recognize newsworthiness, not necessarily exceptional conduct, and it’s hard to deny that Bernanke … Continue reading

Buffett and Geithner

Andrew Ross Sorkin’s Too Big to Fail sure is a page-turner; even for events that I already knew about in general, it’s full of new details and juicy quotations. For example, on page 508 it lays out the details of … Continue reading

Written Testimony Submitted To The Congressional Oversight Panel

Testimony submitted to the Congressional Oversight Panel, hearing on “The overall impact of the Troubled Asset Relief Program (TARP) on the health of the financial system and the general U.S. economy,” Thursday, November 19, 2009. (pdf version) Submitted by Simon … Continue reading

Just Baffling

PPIP finally launches, Mike Konczal lays bare the subsidy, everyone just move along … hey, wait a second! From the Times article: “[FDIC] officials announced that they had reached a deal to sell $1.3 billion in mortgages from Franklin Bank, … Continue reading

Larry Summers on Preventing and Fighting Financial Crises

This fall I am taking a course on the “international financial crisis” taught by Jon Macey and Greg Fleming (yes, the former COO of Merrill Lynch). The first assigned reading is a speech that Larry Summers gave at the AEA … Continue reading

Waiting For The Big Push: Selling The Consumer Protection Agency For Financial Products

In mid-March, the administration proposed that toxic assets could and would be safely removed from banks balance sheets.  We were skeptical, and the the PPIP now seems to have slipped into irrelevance (loans; securities).  But the administration still put an impressive effort into … Continue reading

The Two Sides of the Balance Sheet

Noam Scheiber at The New Republic has the inside scoop (hat tip Ezra Klein) on why Treasury is letting the Public-Private Investment Program die a quiet death (although at this point the legacy securities component may still go ahead). In … Continue reading

Brazen Tunneling and Inflation

In most societies it is traditional to be somewhat sneaky in squeezing your shareholders or the government.  You might set up a complicated transfer pricing scheme or perhaps you arrange for a family-owned firm to acquire assets on the cheap … Continue reading

Banks Want Government Subsidies to Buy Assets from Themselves

From the headlines of the Wall Street Journal: “Banks Aiming to Play Both Sides of Coin — Industry Lobbies FDIC to Let Some Buy Toxic Assets With Taypayer Aid From Own Loan Books (subscription required, but Calculated Risk has an excerpt). … Continue reading

Stress Tests and The Nationalization We Got

The post was co-authored by Simon Johnson and James Kwak. When the stress tests were first announced on February 10, bank stocks went into a slide (the S&P 500 Financial Sector Index fell from 133.13 on February 9 to 96.18 … Continue reading

The Importance of Battlefield Nuclear Weapons

I’ve been writing a lot about the game of chicken recently, most often in connection with the GM and Chrysler bailouts. On the Chrysler front, the game is in its last hours. Even after a consortium of large banks agreed … Continue reading