In the months since I began this website, I have had some fairly harsh things to say about economic policy in the U.S., the U.K. and elsewhere. I have consistently condemned what I think is a captured government promoting an unstable financial system and a bloated financial sector. But, I have made a conscious effort [...]

Remember the iconic Depression-era movie “Mr. Smith Goes to Washington, in which Jimmy Stewart plays the wholesome young man in Washington out to do good? Well, Mr. Smith could just as easily have been your friendly banker at Washington Mutual. Unfortunately, Mr. Smith lost his way and turned predatory lender – and that’s the subject [...]

The Seattle Times has a must-read piece on Washington Mutual today which reveals a lot of the fine detail on how the company was run and what led to its demise (hat tip calculated Risk).
As with many of the other busted financial giants like Northern Rock and Lehman Brothers, indications that something was amiss were [...]

In a 9-page Vanity Fair article “Wall Street’s Near-Death Experience,”giving us a sneak peek into the lives of bankers during the global meltdown last Autumn a hilarious quote of great significance was buried.
At issue was the near-death experience that Lehman’s demise caused for Morgan Stanley and Goldman Sachs. After receiving a mysterious call from JPMorgan [...]

The following Bloomberg article points out why I have repeatedly argued that banks will be earning a lot of money, Meredith Whitney’s counter-arguments notwithstanding. It also points out why the likes of John Hempton believe that the FDIC ‘stole’ Washington Mutual from shareholders and awarded it to JPMorgan, a view I have not supported (hat [...]

Judging from today’s open on Wall Street, it looks like that’s the question people are asking. Wachovia and NCC are the two companies under the heaviest selling pressure, both down about 20% already at 9:45.
Remember that National City is under OCC scrutiny. That is the sort of problem that led to massive deposit withdrawals [...]

JP Morgan Chase has taken over the deposit taking subsidiary of Washington Mutual. The transaction is effective immediately, meaning it has closed. This is the biggest deal in FDIC activity yet.
Note: I originally heard this story just before 9PM ET and Yves Smith at naked capitalism has her take on the news.
Obviously, this is [...]

As we plan for another day in financial turmoil, I have to admit to preferring financial services industry consolidation through merger to bankruptcy. I was just reading FT Alphaville’s post on a proposed Lloyds TSB takeover of HBOS (the UK equivalent of a JP Morgan Chase takeover of Washington Mutual) and I thought, “what [...]

The world of financial services in not looking terribly stable in the wake of the Frannie nationalization. In fact, things are as jumbled as they have ever been. The latest news has AIG down 30% and both WaMu and Lehman brothers on the auction block.
Given the pace of the news cycle these past [...]

Seven years ago, I was involved in a merger that was the last proposed under the old pooling of interests accounting rule that was phased out after June 30, 2001. This methodology was great because it didn’t necessitate acquiring companies to re-mark assets on the companies balance sheets to reflect impairment of intangible assets.
Needless [...]