John Gapper had a good piece in the FT yesterday called “Goldman should be allowed to fail.” His conclusion is that Goldman is allowed to game the system. It is a broker-dealer masquerading as a bank. It takes on much more risk than a traditional bank. It engages in different activities. It compensates its staff [...]

If our response focuses only on the symptoms rather than the underlying causes of the crisis, then we shall bequeath to future generations a serious risk of another crisis even worse than the one we have experienced.
-Mervyn King, Governor of the Bank of England

The Bank of England head has come out unequivocally against continuing with [...]

You are a teacher at a local primary school. Each school day you and some of your colleagues watch over the children at the school playground to make sure all of the children follow the rules and keep their hands to themselves. Your role is to keep the children safe. Mind you, this is a [...]

Watch the hour-long retrospective which aired tonight on PBS’s Frontline.  It should be very enlightening in regards to the seeds of the bubble and meltdown.  It examines who the players in the 1990s and 2000s were, what their attitude to regulation was, and how lax regulation created a bubble and a bust.
Also see the following [...]

David Einhorn delivered a speech at the 2009 Value Investing Conference that is creating a lot of buzz in the blogosphere. He said a lot of interesting things about the investing and political climate.  A surprising amount of it comes out of the playbook here at Credit Writedowns.
Below are the quotes I want to highlight [...]

Elizabeth Warren, chair of the Congressional Oversight Panel, is certainly looks to be fighting the good fight. At the conclusion of the Buttonwood Gathering in New York on Fixing Finance, she met with Tech Ticker’s Aaron Task and gave him quite an ear full.
Listen to what she has to say about the way the lay [...]

I was heartened to hear that Alan Greenspan has repudiated the Too Big to Fail doctrine (as practiced in the Bush and Obama Administrations) in such unequivocal terms. He almost sounded like a Teddy Roosevelt trust buster.
Nevertheless, President Obama clearly believes the line fed to him by Wall Street. He is no Teddy Roosevelt. [...]

In speaking to the Council of Foreign Relations, Greenspan said what I have heard many other credible financial experts say, namely that financial institutions which are ‘too big to fail’ (TBTF) are simply too big.
Is this Alan Greenspan talking?  I am astonished that the man we have called bubble-blower in chief is willing to [...]

In one of my latest posts I said “greed is not good.” Quite frankly, I looked at this statement as self-evident in the wake of an economic catastrophe where greed was a defining element.  Yet, a remarkable number of people commented in defense of greed; they seem to believe greed is a good thing. So, [...]

Below is a YouTube clip featuring Elizabeth Warren, the chair of Congress’ oversight panel of TARP (the Troubled Asset relief Program), the bailout started by Hank Paulson and passed by Congress.  In it she talks about her fears regarding the lack of real regulatory reform in the world of finance and how this is setting [...]