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 […]
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 […]
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. […]
Robert Waldmann “the Financial Accounting Standards Board, which sets U.S. accounting rules, proposed to give more leeway on mark-to-market accounting rules. “ In my (ignorant) view, this is an act of desperation allowing banks to make up asset values, because given current market prices they would be insolvent. The argument is that current prices are […]
Robert Waldmann I don’t know anything about finance. Taking my advice on how to invest would be like tacking Moody’s universe of rated corporate bonds to the wall, throwing darts at it and buying the bond immediately to the right and below the dart and repeating 100 times. I know this, because that is exactly […]
Robert Waldmann OK so no one is interested in my big bad asset bank which requisitions all MBS and CDOs and pays in shares proportional to revenue generated recently (won’t even bother with the link). I have a new plan. The Treasury wants to bring private investors in to help it buy CDOs and such. […]
Robert Waldmann The logic of the new Geithner plan is that CDO’s can be bought for less than their hold to maturity value because of panic and the fact that most huge players have cash flow problems. Thus the logic is that a calm investor whose mood does not swing with the mood of the […]
Robert Waldmann via Atrios How The Gamblers See Things George Stephanopoulos from twitter: Early read on Geithner plan from plugged in investment source asset managers he knows just won’t play until sure WH can control Congress See that’s the cost of acting from anger. The Obama administration is offering asset managers a chance to play […]
Robert Waldmann Tilman Tacke and I are quite cautious in this paper which does not support my pet theory described in this paper. The stylized fact (which has returned after a brief absence from the data) is that, given the income of poorer quintiles, where the rich are richer more babies die. My pet theory […]