BREAKING: AIG Money Laundering Made Banks Profitable in Q1?

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Monday March 30, 2009 · 4:41 AM PDT

2009/03/30 · 04:41

AIG is the scandal that never dies. There was the first bailout for $85 billion. The second bailout for $65 billion. The third bailout for $30 billion. The $165 million in bonuses to the employees in the Financial Products division responsible for bankrupting the company. And, of course, the revelation that AIG has been the conduit for a backdoor bailout of its creditors, particularly Goldman Sachs. However, the latest report concerning AIG is even more outrageous. AIG has not been simply paying its creditors back in full - it has essentially overpaid them on purpose. This is looting.

Matt OBrien

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Sunday March 29, 2009 · 5:40 PM PDT

2009/03/29 · 17:40

If only we could just get banks lending again, we could go back to those heady pre-Lehman days of credit-fueled consumption growth - that seems to be the rationale animating the Geithner banking plan. If we get these toxic assets - er, I mean "legacy assets" - off of banks' balance sheets, then they'll be sound enough to extend credit again. Economic recovery will follow soon thereafter. But can we return to the status quo ante? Or has the deleveraging process gathered such momentum that even if households could take out new loans, they'd choose not to, as they instead try to pay off their existing onerous debt obligations?

Matt OBrien

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Sunday March 08, 2009 · 4:15 PM PDT

2009/03/08 · 16:15

From the annals of journalistic equivalence, comes this tendentious editorial from Jackson Diehl in the Washington Post. The Very Serious Diehl informs us that in actually attempting to follow through on his campaign promises, President Obama risks following his predecessor George W. Bush into presidential oblivion. Indeed, Diehl finds it "odd" that most of the punditocracy has spent the last few weeks comparing Obama's transformative potential to that of FDR or Reagan, while to Diehl the parallels to Bush are so apparently obvious.

David Broder would be proud. After all, while this "pox on both your houses" style of journalism seems easy to write, it often requires a great deal of intellectual dexterity to argue that up is down. Being this vapid is hard. And so in a rather breathtaking display of equivalence, Diehl argues that healthcare reform is Obama's Iraq. Bravura performance.

Cross-posted at Hedged Bet

Matt OBrien

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Thursday March 05, 2009 · 9:57 PM PST

2009/03/05 · 21:57

Um, no. While Buttonhood at the Economist cites research claiming "the US market has only been cheaper for 26 months in the last 140 years," conventional measures like Robert Shiller's 10 year cyclically adjusted P/E ratio suggest that stocks still have a ways to fall.

Cross-posted at Hedged Bet

Matt OBrien

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Friday February 27, 2009 · 5:24 PM PST

2009/02/27 · 17:24

Latvia's government recently became the latest victim of the financial crisis. Despite receiving a nearly $10 billion bailout from the IMF late last year, Latvia's economy contracted at a 10.5% annualized rate in the fourth quarter of 2008, leading their finance minister to diagnose their economy as "clinically dead." Protests over this economic freefall forced the government to step down. But while the crisis in Latvia may yet abate, the question of whether a new round of financial contagion, this time originating in Eastern Europe, will infect the world remains open. Could Latvia - or Poland, or Bulgaria, or Ukraine - be the next Lehman?

Cross-posted at Hedged Bet

Matt OBrien

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Monday February 16, 2009 · 6:14 PM PST

2009/02/16 · 18:14

Breaking news: the MSM is useless. Alright - this isn't breaking news. While I've come to expect the Washington Post's frequent editorializing in its news section against the stimulus and Social Security, every now and then, an article - like this Time piece- is so aggressively misleading that I couldn't let it pass. Since it was apparently too difficult for Douglas McIntyre to do the five minutes of work necessary to lay out the terms of this debate, I thought I would.

Matt OBrien

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Wednesday February 11, 2009 · 7:04 PM PST

2009/02/11 · 19:04

Well, that didn't take long. Usually disillusionment takes longer. But when it comes to fixing our failing financial system - a prerequisite for any economic recovery - it's only taken three weeks for the Obama administration to embrace the same giveaway-to-Wall Street bankers boondoggle that Bush and Co. patented. And as Joe Biden could tell us, that's not the change we need; that's more of the same. Indeed, as far as there even is a plan, it seems to amount to little more than putting lipstick on a pig: taxpayers guaranteeing the inflated values of dud assets. Whether private investors like hedge funds and private equity buy these items from banks first is irrelevant; taxpayers are still ultimately on the hook for assets no one wants to touch.

And that is why it is time for Geithner to go. The information about the latest bailout is the final straw. Real change - the change we need - is looking out for taxpayers before Wall Street. That means giving the public real upside in any bailout, which at this point means nationalizing the banks. Anything else is merely a poorly disguised subsidy for bankers. So Mr. President, it's time to pull another Daschle: admit you made a mistake, and fire Timothy Geithner.

Matt OBrien

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Tuesday September 16, 2008 · 10:53 PM PDT

2008/09/16 · 22:53

Boy, that escalated quickly. After a weekend in which McCain groupies David Ignatius and Richard Cohen disavowed their one-time infatuation with that noted celebrity, Ruth Marcus became the latest WaPo columnist to wake up to the contemptible sleaziness of candidate McCain. Finally, the media is noticing: McCain is running a campaign with which even Karl Rove is embarrassed to be associated. The narrative is building.

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BREAKING: AIG Money Laundering Made Banks Profitable in Q1?

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WaPo: Healthcare=Iraq

Time to Buy Stocks?

Is Latvia the Next Lehman?

MSM: We Can't Be Bothered to Educate Our Readers

Fire Geithner

BREAKING: WaPO Slams McCain...Again!