Author Archives: Felix

Stanford: The Manhunt Begins

Posted on February 17, 2009 by Felix

Given the amount of time that the SEC and the media have been sniffing around his operation, today’s fraud charges can’t have come as much surprise to Allen Stanford. And given that he owns banks in many different jurisdictions (the … Continue reading →

Posted in fraud | 2 Comments

Millennium: A Stanford Copy-Cat

Posted on February 17, 2009 by Felix

Adrienne Carter has found what looks very much to be the first — but surely not the last — of banks which won’t withstand much if any scrutiny in the wake of the Stanford collapse. Does any of this sound … Continue reading →

Posted in banking, fraud | 2 Comments

Stanford: How Quickly did the SEC Move?

Posted on February 17, 2009 by Felix

According to the SEC press release, it has acted with lightning speed: Said Linda Chatman Thomsen, Director of the SEC’s Division of Enforcement: "We are moving quickly and decisively in this enforcement action to stop this fraudulent conduct and preserve … Continue reading →

Posted in fraud | 2 Comments

Highlights of the SEC Complaint Against Stanford

Posted on February 17, 2009 by Felix

The SEC complaint against Stanford is quite astonishing. Here are some of the highlights, which include a slew of outright lies and even an investment with Bernie Madoff. Impossibly, Stanford’s portfolio managed to rack up identical 15.71% back-to-back returns in … Continue reading →

Posted in fraud | 3 Comments

Stanford: The SEC Moves

Posted on February 17, 2009 by Felix

The SEC has frozen all the assets of Allen Stanford and his companies, as well as those of his CFO and CIO. I think you can guess why: The SEC’s complaint, filed in federal court in Dallas, alleges that the … Continue reading →

Posted in fraud | 2 Comments

Taxing Falling Carbon Emissions

Posted on February 17, 2009 by Felix

Back in November 2007, in a long post on the relative merits of a carbon tax and a cap-and-trade system, I said that one big advantage of cap-and-trade was that it was "a dynamic hedge of fat-tail CO2 risk". The … Continue reading →

Posted in climate change | 2 Comments

GE Datapoint of the Day

Posted on February 17, 2009 by Felix

Rolfe Winkler has run the numbers on how GE compares to other banks (yes, GE is a bank) and has come to the conclusion that as of December 31, GE had total tangible common equity of… wait for it… $5 … Continue reading →

Posted in stocks | 2 Comments

Geithner’s Vagueness Explained

Posted on February 17, 2009 by Felix

How could Geithner’s much-vaunted financial rescue plan have been so stunningly vague on arrival, given the amount of time he’d worked on it? The Washington Post reveals that in fact he’d only been working seriously on it for less than … Continue reading →

Posted in fiscal and monetary policy | 1 Comment

Stanford vs Citi

Posted on February 17, 2009 by Felix

Comment of the day comes from John Slater: You’ve had some interesting posts on Stanford. It appears that they have taken deposits to acquire trading/speculative assets. Not sure that what the big trading banks have done is all that different … Continue reading →

Posted in banking | 3 Comments

Extra Credit, Monday Edition

Posted on February 17, 2009 by Felix

Wristcutters: An Economic Story: My Bloggingheads diavlog with Jesse Eisinger. Saving Federal Arts Funds: Selling Culture as an Economic Force: The Senate voted against it, but $50 million in extra arts funding did make it into the final stimulus bill. … Continue reading →

Posted in remainders | 1 Comment

Alex Dalmady, the MSM, and Stanford

Posted on February 16, 2009 by Felix

Alex Dalmady, the analyst who broke the Stanford story, has a blog now, and he’s not afraid to use it: his latest blog entry has appeared with the headline "The WALL STREET JOURNAL can kiss my ass!": (Update: Dalmady’s entire … Continue reading →

Posted in fraud, Media | 1 Comment

America’s Insolvent Banks

Posted on February 16, 2009 by Felix

John Hempton has 5,155 words on bank insolvency today, and makes the good point that "insolvency" is not well-defined. So what do I mean when I say that some big banks are insolvent? I mean that when you look at … Continue reading →

Posted in bailouts, banking | 2 Comments

The Psychic Bailout

Posted on February 16, 2009 by Felix

Guess what? It turns out that hope is a plan, after all! Six middle-aged Englishwomen have decided that they can get the country to "overcome whatever obstacles and difficulties we may face as a country, an economy and as individuals": … Continue reading →

Posted in bailouts | 1 Comment

How the Economic Sausage is Made

Posted on February 16, 2009 by Felix

Gregory Clark reveals all: Recently a group of economists affiliated with the Cato Institute ran an ad in the New York Times opposing the Obama stimulus plan. As chair of my department I tried to arrange a public debate between … Continue reading →

Posted in economics | 1 Comment

The Kanjorski Meme, Mark II

Posted on February 16, 2009 by Felix

Tyler Cowen is now talking about the Kanjorski Meme Mark I (I thought I’d dealt with that one already) — but that’s not the end of the story, as Sam Jones demonstrates today. Sam has what you might call the … Continue reading →

Posted in bonds and loans, Politics | 2 Comments

Japan’s Whiplash

Posted on February 16, 2009 by Felix

Edward Hugh has a good summary of what he calls Japan’s “unimaginable” contraction — the one which resulted in that 12.7% annualized fall in GDP in the fourth quarter. One important lesson, here, is that it’s foolish placing much faith … Continue reading →

Posted in economics | 1 Comment

Extra Credit, Sunday Edition

Posted on February 15, 2009 by Felix

GM to Offer Two Choices: Bankruptcy or More Aid: And if it gets the "more aid", it’ll surely be back for yet more later. This risks becoming the bottomless bailout. Do Androids Dream of Apple-Blackberry Crumble? The demise of the … Continue reading →

Posted in remainders | 1 Comment

New York Employment Datapoint of the Day

Posted on February 15, 2009 by Felix

From Richard Florida’s Atlantic cover story: Financial positions account for only about 8 percent of the New York area’s jobs, not too far off the national average of 5.5 percent. By contrast, they make up 28 percent of all jobs … Continue reading →

Posted in cities, employment | 1 Comment

Sunday Stanford

Posted on February 15, 2009 by Felix

The Stanford story is picking up a lot of steam, to the point at which it’s becoming hard to keep up. A lot more information is coming to light about Stanford’s investments, many of which seem to be in highly-illiquid … Continue reading →

Posted in fraud | 1 Comment

Extra Credit, Friday Edition

Posted on February 14, 2009 by Felix

Under One Stress Test, Big Banks Look Anemic: If the government’s stress test is anything like Creditsights’s stress test, then Wells Fargo will need another $119 billion; BofA, $99 billion; JPMorgan, $124 billion; Citi, $101 billion; Goldman Sachs, $47 billion; … Continue reading →

Posted in remainders | 1 Comment

Stanford: Your Daily Dose of WTF

Posted on February 14, 2009 by Felix

It took Alex Dalmady 30 minutes to work out that there was something obviously wrong at Stanford International Bank. The SEC, on the other hand, works a bit more slowly: BusinessWeek previously reported that the Securities and Exchange Commission, the … Continue reading →

Posted in fraud | 1 Comment

Magazine Cover of the Year

Posted on February 13, 2009 by Felix

There really can’t be any doubt about this one: World Finance splashes Sir Allen Stanford all over the cover of its Jan/Feb 2009 issue. And the prose couldn’t be any more glowing, or more ironic: World Finance’s 2008 Man of … Continue reading →

Posted in Media | 1 Comment

Did Chanos Break the Law?

Posted on February 13, 2009 by Felix

The best way of getting lots of angry comments on a blog entry is to be rude about Apple. But the second-best way is nice about short sellers. So it’s hardly surprising that after I made sympathetic noises about Jim … Continue reading →

Posted in fraud, regulation | 3 Comments

Are Uninsured Bank Depositors in Danger?

Posted on February 13, 2009 by Felix

One of Dan Colarusso’s favorite bloggers, Hugo Lindgren, picks up on the latest weekly newsletter from Christopher Wood: It is even more amazing that Obama does not understand the political appeal of the nationalization option. Maybe the so-called liberal Democrats … Continue reading →

Posted in banking | 51 Comments

Colarusso on Blogonomics

Posted on February 13, 2009 by Felix

Dan Colarusso, who used to run portfolio.com, has now moved over to join Henry Blodget’s blogshop. It’s quite a change of pace, as he explained to me in an IM conversation this afternoon: Felix Salmon: So! You’ve been on the … Continue reading →

Posted in blogonomics | 1 Comment