Posted by Larry Doyle on November 25th, 2013 9:38 AM |
What does that figure represent? The subsidy (aka competitive advantage) that accrues to our major banking institutions from favorable borrowing rates given their status as ‘too big to fail.’
Those tens of billions of dollars truly represent a nice, big head start for a handful of banks, and a withering assault on the precepts of free market capitalism for the rest of us.
As if $82 billion were not enough of a subsidy, let’s not forget that these banks pay you, as a depositor, virtually zero interest for the ‘privilege’ of holding your money there. Well, that may be changing. How so? How would you like to actually pay interest to the banks in order to keep your money in their institutions? Really? No way?
Yes way. (more…)
Posted by Larry Doyle on September 5th, 2013 8:59 AM |
While many in Washington and elsewhere will look to collect political points for bringing reform to Wall Street, those watching closely knew all too well that the blueprints for this reform were always subject to massive change.
So has Dodd-Frank brought real reform to Wall Street? If you believe so, I would invite you to become a charter member of The Gullible Club.
Let’s dispense with the formalities. Wall Street ultimately answers to nobody but itself. As such, we can unload another truckload of dirt over the casket holding Dodd-Frank.
While many observers of the financial and political scenes are not inclined to draw attention to this service, fortunately those at Bloomberg view this funereal undertaking more seriously. I thank them as they recently pulled back the cloak on Dodd-Frank to reveal a Wall Street dagger protruding from its midst. (more…)
Posted by Larry Doyle on September 4th, 2013 10:07 AM |
With the five year anniversary of the demise of Lehman Brothers right around the corner, a financial reporter from a major news outlet reached out to me yesterday to get my take on the current situation on Wall Street.
He was interested in touching upon the current culture within the industry and what has changed.
We had a fair bit to discuss and I was not bashful. (more…)
Posted by Larry Doyle on March 27th, 2013 6:17 AM |
Here we go again.
With the investigation of the greatest financial fraud ever perpetrated on Wall Street — that being the manipulation of Libor — still in the early stages, news emanating from Europe this morning redirects the shadow from that organized activity into the dark and dank world of credit derivatives, aka CDS.
Recall that cornerstone principles of an industry that operates as an oligopoly are: (more…)
Posted by Larry Doyle on January 31st, 2013 9:52 AM |
The other day I addressed the current David vs Goliath situation in the banking industry and presented The Case for Community Banks. There is no doubt that the crisis that emanated on Wall Street required some real regulatory attention. Regrettably the “one size fits all” regulatory changes embedded in Dodd-Frank is not the answer. Not that people in Washington with little background in markets and the economy might understand that.
Let’s listen to former Inspector General for the TARP, Neil Barofsky, who provides a brief 2-minute dose of ‘sense on cents’ on how Washington has hurt the small community banks in our country. Props to American Banker for this clip.
I have no business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.
Posted by Larry Doyle on January 29th, 2013 9:19 AM |
While the mega-banks on Wall Street flex their oligopolistic muscles (price controls, imperfect information, not sharing data), I want to take this opportunity to throw some support to the Davids of the banking world.
Who are these Davids? The community banks. Do you feel like you get a lot of personal touch and proper attention from Goliath? Really? How about from David?
Let’s navigate and review a compellingly detailed analysis recently released by the Dallas Fed. (more…)
Posted by Larry Doyle on January 17th, 2013 11:54 AM |
Three days ago I wrote how strongly I believe that the Wall Street landscape needs to be restructured. How so? I made my case in defining Wall Street as an oligopoly and Why Should the Banks Be Broken Up?
I concluded my commentary by highlighting that Dallas Federal Reserve governor Richard Fisher would be addressing this same topic on Wednesday evening. What did the good governor have to say? (more…)
Posted by Larry Doyle on April 13th, 2012 9:09 AM |
UPDATE: This commentary written in mid-April 2012 should be read in conjunction with the following:
May 14th Review: Bloomberg Bombshells re: JP Morgan $2B Loss
May 12th review: $2B Loss? What Went Wrong at JP Morgan?
May 11th review: JP Morgan Whale: “Thar She Blows”
Reports are swirling around Wall Street and the global markets about massive credit bets on the books at JP Morgan.
A JP Morgan trader in London, Bruno Iksil, has been nicknamed ‘the whale’. Iksil reports ultimately to Achilles Macris, JPM’s chief investment officer in Europe and Asia. Bloomberg had an interesting discussion this morning about Iksil, Macris, JPM, and these positions. Let’s watch and learn… (more…)
Posted by Larry Doyle on March 18th, 2012 10:06 AM |
Former Goldman executive Greg Smith created quite a firestorm on Wall Street this week. Smith tarred and feathered his former firm for the manner in which they engage their clients.
While I believe Smith should have been more pointed in directing his fire, for those impugning Mr. Smith, including New York City Mayor Michael Bloomberg, I would offer that what Mr. Smith asserts is HIGHLY unlikely just a Goldman issue.
Why do you think JP Morgan’s CEO and Morgan Stanley’s CEO James Gorman informed their troops to hold their own fire in response to the bombshell launched by Mr. Smith? (more…)