The new Commission set up this summer held its 4th meeting today. (The members of the Independent Commission on Banking are Sir John Vickers, Clare Spottiswoode, Martin Taylor, Bill Winters and Martin Wolf). Their call for evidence that came out in September listed these potential policy options any of which make significant changes to banks and certainly along the lines of my discussion on the potential results from 2009. Independent Commission on Banking (UK) Reform options related to the structure of banks ••Separation of retail and investment banking ••Narrow banking and limited purpose banking ••Limits on proprietary trading and investing … Continue reading Independent Commission on Banking holds its 4th meeting

There is an increasing disparity between the US economy and the others in the west.  It is particularly noticeable between US and Canada who site right beside each other with one of the longest borders in the world.  The US situation kicked off in 2007 with concerns about US mortgages that contained underlying and unrecognised double risk generally associated with mortgagors ability to service and collateral value.  Whereas in Canada the real estate market has been relatively uneventful with both ups and downs throughout the 2007 – 2010 period. The US on the other hand has entered a period of … Continue reading US real estate market stands alone in the world and not in a good way

When I wrote up the piece on the sensibility of the concepts contained in Sharia finance I knew there were undercurrents everywhere that would react to the words Sharia and Islamic which would blind folks to the concepts that exist underneath those apparently inflammatory words.  Sense about sharia | Economist Contrary to some hysterical talk, nobody seriously suggests the use of Islamic penalties in any democracy. Nor is there any reason to fear Islamic finance: a campus discussion about zero-coupon bonds does not mean usurers will be flogged in Harvard Yard. Nor can anybody object if two citizens settle a … Continue reading The worries about Sharia are getting in the way of common sense regarding better opportunities in finance

Barry breaks down the detailed components of the subprime mortgage legalities. The Impact of Error From Securitization to Foreclosure There are quite a few misunderstandings, denials, and exaggerations floating around as to what the final outcome might be of “Fraudclosure.” At the current stage, we really do not know how extensive the problems are. We could make wild and unsubstantiated conclusions, but we prefer reason and logic. Technorati Tags: subprime mortgages,foreclosure,securitization,MBS,ABCP Continue reading “The Impact of Error From Securitization to Foreclosure” | The Big Picture

This from the Washington Post contains the details on the foreclosure mills aka law firms who are competing for their share of foreclosure work and form part of the ‘broken chain’ that is invalidating foreclosures.  This represents another layer of incompetence in the whole process. First there is the matter of the legality of the mortgage Second the sloppy methods employed by incompetent foreclosure mills and supported by fee penalties from Freddie for any delay in the foreclosure action. For foreclosure processors hired by mortgage lenders, speed equaled money | Washington Post The financial incentives show that the problems plaguing … Continue reading More on “fraudclosure” | Washington Post

This is off topic for this blog.  USA conducted a ‘subcritical nuclear test’ last month in Nevada.  What gets me is that this is completely below the radar in North American news coverage, especially given the presidents views on nuclear.  Social media though is all over it.  USA CONDUCTS NEW SUB CRITICAL TEST – NEVADA, SEPT 20, 2010 September 20, 2010 – U.S. CONDUCTS SUBCRITICAL NUCLEAR TEST by Andrew Kishner On Wednesday, September 15, the United States Department of Energy conducted a subcritical nuclear experiment under the NNSS (Nevada National Security Site) facility in Nevada formerly known as the Nevada … Continue reading Where is US media coverage of US nuclear test?

As a follow up to my earlier post on the unfortunate demise of Wesabe, here is Marc Hedlund’s clear and lucid view. http://blog.precipice.org/why-wesabe-lost-to-mint Bottom line it was Mint’s effort to ensure customers did not have to do any work in getting set up (tagging), and ongoing importing of data (Mint chose Yodlee).  The reason PFM’s are not broadly appealing is precisely because of the associated work effort.  People need things to happen simply and it turns out they are willing to compromise accuracy to that simplicity. Technorati Tags: Wesabe,Marc Hedlund,PFM Continue reading Marc Hedlund on Wesabe demise

This survey released today asked bank executives in institutions of banks, with 62% of the respondents being from small banks (those with less than $500 million in estimated assets). The picture is a disturbing turn for the worse as the realities of a new structural unemployment and the impact of government borrowing weighs heavily. Grant Thornton – Bank Survey – Sept 2010 CHICAGO, Sept. 29, 2010 – Bankers are again becoming pessimistic about the economy, according to Grant Thornton LLP’s 17th Bank Executive Survey, conducted in conjunction with Bank Director magazine. Only 15% of bank executives believe the U.S. economy … Continue reading Bank survey shows dramatic increase in pessimism in the U.S.

Its too bad this innovation panel brought out the usual bank thinking by focussing on what they thought they were doing that was innovative rather than greater focus on lessons learned. ING, HSBC and Nordea outline barriers to banking innovation | finextra Beurden goes on to say that banks need to recognise how many so-called "painful moments" they face off to their customers and reconcile these with what he describes as a "pleasure curve." (Such as a store offering a child’s play area, while parents wait in line at the register.) He adds that ING will be making a technology … Continue reading Banks’ view of innovation is sadly lacking in imagination