Regulatory handicapping: the CFTC edition

And just two days after I reported on the starve-the-beast strategy that’s forcing the SEC to pursue Mickey-Mouse settlements with the big banks, we learn of plans to handicap the Commodities and Futures Trading Commission in a similar fashion

Regulators encouraging banks to game risk models

Andrew Haldane, in my opinion, generally has the right idea about banks and their risks, which are risks not just “to themselves” but to all of society and the global economy. Yet here Haldane’s endorsing the sort of sleight of hand that banks are all too ready to perform with no encouragement. Not a good sign

Meeting Bank Capital Requirements in Europe

There are a number of ways that European banks are moving to boost their Tier 1 capital and strengthen their balance sheets. Some are cutting dividends, diluting current share holders through new rights issues, laying off staff, and selling off assets

In defense of the SEC — no, really

The Finance Addict writes : “We need to put our cynic hats on and start questioning why it is that the SEC isn’t getting any. My guess–it’s no accident.”

Video: Warren Buffett on ‘Too Big to Fail’

Here’s more from Warren Buffett on CNBC this morning. This time he talks to Becky Quick about ‘Too Big To Fail’. CNBC host Joe Kernen takes sides with the Occupy Wall Street protesters and asks Buffett whether we can regulate them to “keep them honest” or whether we need to “break them up”. Buffett responds in the video below

Bill Black: What I’d Demand of the Fed

In this interview from late October, Professor Bill Black tells us what he would demand, if he marched with Occupy Wall St. to the New York Fed

BofA delays Countrywide bankruptcy

The word is that BofA did in fact consider declaring their Countrywide subsidiary bankrupt to ring fence the rest of the company from Countrywide. It got as far as a board vote this past summer.

This Wall Street Journal video discusses the issues of why it has postponed the bankruptcy filing

Hard evidence: bailed out banks take more risk

Politicians, Treasury Secretaries, etc. would have you believe that “moral hazard” is something we should only worry about in the abstract, in the future, when they’ve moved on to another job. But now a study confirms with hard facts: moral hazard–it lives.

Researchers have asked for some time whether and how bailouts might affect banks’ risk-taking. Would they run wild, aware of the high likelihood of being bailed out again if they ran into trouble? Or would they ease off precisely because they’d now be assured of lower financing costs and long-term survival, and therefore would want to avoid doing anything that might cause regulators to take that valuable banking license away? More daring or more discipline

The World’s 29 Too Big To Fail Banks

Here is the list of so-called global systemically important financial institutions by country. Who’s missing in your view

Sheila Bair on European Regulatory Capture

Sheila Bair argues that Europe’s banks are undercapitalised due in large part to regulatory capture

You Sexy M.F.

Here are a bunch of videos and links which update you on MF Global

On the CDS market, the Greek referendum and US banks’ selling insurance

There is much truth to the generalization that European banks took on direct exposure to European sovereigns through the bond market, while top banks took exposure through selling insurance, primarily CDS, on the sovereigns. The latest BIS data suggest that in H1 2011, US banks increased their CDS sales by almost $81 bln to $518 bln. Two thirds are tied Greece, Ireland, Portugal, Italy and Spain. Five US banks count for more than 90% of the CDS exposure