Posts Tagged ‘Glass-Steagall’

Notes From Underground: Warren Knocks Out Mnuchin

May 18, 2017

In Thursday’s testimony before the Senate Banking Committee, Treasury Secretary Steven Mnuchin took a beating from Senator Elizabeth Warren over the issue of Glass-Steagall. There are many policy issues in which I disagree with Senator Warren but when it comes to Wall Street regulation, she is one of the most knowledgeable people in the Senate and far beyond those walls. During the Great Financial Crisis she appeared regularly on CNBC and Bloomberg television networks. While merely a Harvard law professor, she offered great insights and understood the depths of the problems that caused the crisis. If Jamie Dimon had not blocked her appointment as head of the Consumer Finance Protection Bureau (a wild conjecture on my part), she would not be a U.S. Senator. After president Obama caved in to Wall Street pressure, Warren ran for the Senate in Massachusetts in 2012, defeating Scott Brown.

(more…)

Notes From Underground: Let’s Deflate the Cult of Personality and Media-Inflated Infallibility

August 18, 2015

Some follow-through from yesterday: The DAX,Dow and Russell 2000 closed below their 200-day moving averages but it is early in the week so while a negative it is not definitive of any sustaining activity. Just another effort to be attentive to global developments. The Chinese markets were under assault last night, which led to a selloff in copper and silver prices although GOLD remained firm. Some analysts maintain that the selling in copper and silver was due to having meet margin calls with account collateral being liquidated. I have no argument with that analysis but if so silver should regain itself above 15.10 and GOLD should rise above its recent highs. If China’s recent market developments is the onset of global deflation the world’s central banks will be forced into renewed crisis mode and the precious metals will again be viewed as a “reliable haven.” Let the market be your guide for theory confirmation and have your technical levels ready especially for GOLD resistance.

(more…)

Notes From Underground: The Great Helmsman Held the Good Ship QE Steady

July 17, 2013

FED Chairman Ben Bernanke steered a steady course as he was questioned by the House of Representatives today. The release of the chairman’s prepared testimony 90 minutes early was a benefit as the markets had time to actually read the substance of the address and not just react to the ALGO-DRIVEN HEADLINES. Even with the extra time to read the release some talking heads still failed to understand the chairman’s efforts to remain balanced. I do agree with Mohamed El-Erian that the tone of the prepared statement was “dovish” and Bernanke wanted to appear very concerned about the lack of growth in the jobs market.

(more…)

Notes From Underground: Trader’s View On the Market (CNBC)

May 23, 2012

Click the image to watch me talk about Andrew Ross Sorkin’s piece on Glass-Steagall and where he gets it wrong.

Notes From Underground: AUGUST 30 ,2002 … A Revisit To The SOAPBOX

May 14, 2012

LETTERS TO THE EDITOR – Profit centres too big to fail.
By YRA HARRIS.
30 August 2002
Financial Times
(c) 2002 The Financial Times Limited. All rights reserved

Sir, John Plender (“How banks got in a mix”, August 21) correctly identifies the systemic dangers that accompanied the passage of the Graham-Leach-Bliley act. The repeal of Glass-Steagall has pushed the US banking system to the brink of “moral hazard”. The conglomeration of all financial services under one roof has entangled banks in numerous ethical conflicts. Additionally, Graham-Leach-Bliley has made several institutions so large that the Fed cannot allow them to fail.

A single institution’s deep involvement in every facet of financial dealings does not create greater synergy but greater risk. These large, private profit centres know they are too big to collapse. This realisation adds great uncertainty to the entire financial landscape. Rewarding private profits while socialising the risk is a pathway to disaster. Glass-Steagall should never have been repealed without a bank forfeiting its right to Federal Deposit Insurance Corp insurance.

(more…)

Notes From Underground: Economy to Ben Bernanke … It’s Not You, It’s Me

September 21, 2011

THERE WAS CERTAINLY NO SURPRISE FROM THE FED TODAY EXCEPT THAT THE FOMC STRESSED THAT THERE ARE SIGNIFICANT DOWNSIDE RISKS TO THE ECONOMY. It appears that this phrase caused the markets to sell everything after the release of the most important outlook for U.S. economic policy. The market’s response must have left Mr. Bernanke wondering just what the FED could actually do to lift the “animal spirits” of the investor and business community.

(more…)

Notes From Underground: Hazy Global Outlook

May 21, 2010

Yra Harris talks about the markets on CNBC.

Click on the image to watch Yra talk financial reform and sovereign debt markets on CNBC’s “Squawk on the Street.”