Jul 28 Thaler Responds to Posner on Consumer Protection Paul Solman: Earlier this month, I was pleased to learn that one of the most intriguing economists of my career span, the University of Chicago’s Richard Thaler, had entered the rotation of the… Continue reading
Jun 29 Watch Madoff Sentenced to 150 Years in Prison for Ponzi Scheme Disgraced financier Bernard Madoff was sentenced Monday to 150 years in prison after pleading guilty in March to defrauding investors out of as much as $60 billion. Ray Suarez talks to New York Times reporter Diana Henriques about the day… Continue watching
Jun 25 Will the Actions of the Fed and Treasury Keep Asset Prices Artificially High? Question: It seems to me like the Fed and the Treasury are trying very hard to keep asset prices high. The Fed has vastly increased the money supply, partly by lowering interest rates to zero, and partially through quantitative easing. Continue reading
Jun 18 How Will the Regulatory Reforms Affect Consumers? Paul Solman: We asked a number of people in the personal finance business and others close to the credit crisis to weigh in on the Obama administration’s new consumer protection proposal. I’m struck by Doug Elliott’s admonitions, especially his last… Continue reading
May 13 Why Doesn’t the Government Set Up a New Bank to Get the Economy Moving Again? Question: I’ve been watching the difficulties the government has had propping up the banks — the lack of control, the salaries, the fact that they’re trying to fix entities with a lot of toxicity on their balance sheets. The following… Continue reading
May 12 Who Owns the Credit Card Companies? Question: Who owns the credit card companies? Once upon a time, Bank of America owned Visa, but I’m not sure if it’s been spun off. So, if the stress tests have shown that the banks are not as healthy as… Continue reading
May 01 How Do We Regulate Credit Rating Agencies? Question: How do we supervise and regulate the credit rating agencies which, so poorly and perhaps illegally overrated so many derivatives? Paul Solman: I don’t know. One proposed reform has been that the investors pay the ratings agencies for… Continue reading
Mar 12 How Are Losses on Mortgage Derivatives Calculated? Question: If there is no way to currently value the mortgages on which the value of derivatives (collateralized mortgage obligations, etc.) depend, how are losses on those derivatives — such as AIG $62 billion… Continue reading
Oct 07 Why were there no checks on these fraudulent practices and unscrupulous mortgage brokers? Question/Comment: I have a hard time understanding how some of these mortgages were ever permitted to happen. In particular, mortgages for which absolutely no documentation for verifying income or anything else were required. This allows borrowers to lie on their… Continue reading
Sep 26 Watch Largest Bank Failure in U.S. History Preempts Any Bailout Plan Another blow was dealt to the ailing American finance system as Washington Mutual Bank was seized overnight by the U.S. government. By morning its assets were sold off to JPMorgan Chase. Business reporters detail the sudden and drastic move. Continue watching