26 Jan 2010

Apology to Wall Street

Just how strong the Anti-Wall Street feeling is can be seen from this article on - of all places - Marketwatch. Is it not time that someone listens? (or is everyone AWOL in Davos?)

21 Jan 2010

Austria: Back to the Past

Austria demonstrates that political control of banking institutions by no means assures that banks are managed in a responsible fashion. Numerous banking problems during the past 30 years (Laenderbank, Bawag, Kommunalkredit, Bank Burgenland) prove this point. The most recent example of a bank that was the plaything of politicians and got into trouble while the regulators turned a blind eye is the Hypo-Alpe-Adria Group in the southern province of Carinthia. The bank had to be rescued by the Federal Government in December 2009 and to cap it all two members of the political establishment have now been appointed to the supervisory board. Plus ca change....

17 Jan 2010

Michael Mayo Testimony - Financial Crisis Inquiry Commission January 2010

Nobody has the time to read everything of relevance - but occasionally we like to the highlight little gems such as Michael Mayo's testimony to the Financial Crisis Inquiry Commission.

10 Jan 2010

Banking Reform - 2009 a year of lost chances

News that the former CEO of AIG, Hank Greenberg, is trying to have the regulators and politicians look into the circumstances of the bailout of AIG in the autumn of 2008 is just one symptom that the after-effects of the 2008 banking crisis will be with us for quite some time. Most of the ongoing problems can be traced back to the fact that bail-outs were executed in an arbitrary fashion devoid of any principle and in addition there was no democratic oversight. At least the citizens of Iceland have a say in the (non)payment of the bailout money they are asked to contribute to. In the past year there has been zero progress towards creating a banking system that does not explicitly or implicitly rely on future bailouts by the taxpayers. We are not confident that 2010 will bring more progress.