Credit Where Credit Ain’t Due

Two large debit-card issuers have suddenly decided to clean up their acts in the face of pending legislative action against them. The bigger question is: what’s to prevent them from pulling a bait and switch, first voluntarily revising their rapacious practices and then, when the threat of legislation dies...

The Blue Dogs: Best Friends of Big Business

[Updates below – Ed.] As the Obama administration attempts to overhaul the nation’s health care, energy, and financial sectors, it faces the growing leverage of the Blue Dog Coalition—the conservative, fifty-two-member faction of the House’s Democratic caucus—to moderate, or obstruct, its...

Doddering and Dithering on Financial Reform

The New York Times reports on the formidable resistance in Congress to Obama’s efforts to, among other things, create a new consumer protection agency to cover credit cards, mortgages, and other poorly-regulated financial products. It cites . . . significant criticism from the financial services industry...

Florida Regulators Aided and Abetted Stanford

The Miami Herald published a long investigative piece about how Sir Allen Stanford, whose Antigua-based banking empire has been shut down as a massive fraud, was able to open a Miami branch in 1998 free from regulatory oversight, with the approval of Florida banking regulators. Stanford got his...

UBS or Just Plain BS?

The Obama Justice Department has just floated a trial balloon to see if it can drop a legal effort to force the Swiss Bank UBS to disclose the names of 52,000 rich Americans suspected of using the bank to evade US taxes. Back in February, the Justice Department sued the bank in an effort to force it to name...

Hedge Funds Flex Lobbying Muscle

The Wall Street Journal has a solid piece of reporting on the continued power of hedge funds to shape their own—and the nation’s—destiny. The lede says it all (subscription required): Many hedge funds were relieved last week when the Obama administration’s financial-overhaul plan included no big...

Goldman Sachs Record Bonuses: Where’s the Investigation?

Goldman Sachs is on pace to make record bonus payouts after a robust first half, the Guardian newspaper reported on Sunday. Goldman staff in London were briefed on the outlook and told they could look forward to the bonus hikes if the company registers, as predicted, its most profitable year ever, the report...

Who’s Got Obama’s Ear?

In the New York Times, Joe Nocera argues that Obama’s steps at regulating Wall Street are tepid compared to FDR’s and are likely to leave in place some of the very mechanisms that contributed to the crisis. Read this excerpt, if not the entire piece, then my closing comment: [T]he Obama plan is little...

Moral Hazard, Fed Style

How exactly did the Federal Reserve gain the emergency authority to loan more than $1 trillion of taxpayer money to the banks secretly and without oversight? The Washington Post explains today in a long investigative piece by Binyamin Appelbaum and Neil Irwin. As it turns out, Sen. Chris Dodd slipped the...

$2 Trillion > $700 Billion

We’ve heard a lot rumbling from the banks in the past several weeks about how committed they are to repaying the TARP money they have received at the soonest opportunity. The motive of such talk is clear: Paying back TARP money would clearly be seen as a sign of strength,” Douglas Elliott, fellow at...