Robert Waldmann A while ago I read a long article on AIG whose url I don’t remember. The story was the usual success -> hubris -> fall, but to me, one striking thing was that the success, the stuff AIG-FP did before going crazy, was mostly related to tax avoidance. In fact, they seem to […]

rdan Ezra Klein says: …So the Geithner plan is really two bets in one. The first is that this is not the worst case scenario and does not require the fixes developed for the worst case scenario. The second is that if this turns out to be the worst case scenario, then we still have […]

Robert Waldmann One of Mark Thoma’s links of the day is beyond awesome. Researchers report Experiments in the Brain Scanner A total of 24 subjects participated in the study which has just been published. Whilst recumbent in a scanner, they were called upon to solve simple problems. Success brought a financial reward. At the same […]

rdan (Links provided by MG) Treasury Department Releases Details on Public Private Partnership Investment Program The Role of the Federal Reserve in Preserving Financial and Monetary Stability: Joint Statement by the Department of the Treasury and the Federal Reserve TREASURY DEPARTMENT PUBLIC ENGAGEMENTS SCHEDULE FOR THE WEEK OF MARCH 23 � MARCH 29

Robert WaldmannDefenders of the Geithner plan argue that, even if Obama knows he will eventually have to nationalize banks, he has to show he is willing to try everything, absolutely everything, else first, so that he can convince Congress that he really has to nationalize banks. So the idea is to buy a few votes […]

rdan Dean Baker says: Wall Street and the Economy Suppose Timothy Geithner announced a new program that would tax every family $10,000 dollars and give the money to Wall Street banks and hedge funds. (Any resemblance between this hypothetical program and real world programs is purely coincidental.) We would expect the stock of Wall Street […]

Robert Waldmann A lot of the blogolandian debate on the Geithner plan is based on the assumption that there are only three options1) The Geithner plan2) Try to convince congress to nationalize banks now (real quick before they knew what hit them) and3) Do nothing. Now this is reasonable in the sense that no way […]

Following up on Robert’s post (he started later and finished earlier): Dr. Black: [T]he idea that all this came about simply because the banksters decided a bit of extra risk was good is an idea only a macro finance person could sanely entertain. All right, I represent that remark in more ways than one. So […]

Robert Waldmann Brad DeLong writes I think the private-sector players in financial markets right now are highly risk averse–hence assets are undervalued from the perspective of a society or a government that is less risk averse. Paul judges that assets have low values beceuse they are unlikely to pay out much cash. I have the […]

Robert Waldmann Shorter US Treasury “I usually shop there, but they are having a fire sale so we should go shop somewhere else” When did they hire Yogi “no one goes there anymore, its too crowded” Berra ? Direct quote of the US Treasury “a wide-scale deleveraging in these markets and led to fire sales. […]