Tag: Juncker

Finance Addict will return on January 2

| December 28, 2011 | 0 Comments

Until then, have a look at the top 10 FA stories from 2011. Happy New Year to you and yours!

10. Notes on global wealth. We learned some interesting things from Credit Suisse’s Global Wealth Report.

9.   No time for tax reform. The tax code is “riddled with special preferences”, says one who should know — Tim Geithner, U.S. Treasury Secretary.

8.  Black Friday, television and debt. The holiday season is a good time to look at whether television ads caused us to take on more debt. A study from 2009 says that they did.

7.  What’s underneath the $470 billion TARP?  Be prepared to throw up a little after reading the Government Accountability Office’s annual audit on TARP.

6.  Greek CDS shenanigans. How to avoid calling a spade a spade.

5.  What the top 1% doesn’t want you to know. Up until now a lot of the dialogue has been around hurt feelings and hypotheticals. Here’s what’s really revealing.

4.  OWS? Here’s who the banks should really be scared of. We should be paying attention to another fast-spreading movement that can do a lot more direct damage to the big banks.

3.  Hard evidence: bailed-out banks take more risk. A recent study actually lets us observe moral hazard in action.

2.  AIG chairman says that you just don’t get it. Steve Miller is the chairman of AIG, which received bailouts totaling $69.8 billion in taxpayer money. Which has not been fully repaid. Here’s what Steve said recently.

And our #1 story of the past year was… Continue Reading

Weekend wrap-up: 10/24/11 to 10/28/11

| October 29, 2011 | 0 Comments

Here for your weekend reading pleasure are our most popular posts from the past week.

  1. Greek CDS Shenanigans. The big question is whether the latest deal for Greece will trigger a CDS pay-out.
  2. Notes on global wealth. We learn some interesting things from Credit Suisse’s Global Wealth Report, published last week.
  3. Why the rich should Occupy Wall Street.  The American rich have also suffered from the financialization of the economy.
  4. The Obama administration hears you–sometimes. News outlets are reporting that the Obama Administration’s new student loan initiative came partially as a result of a citizens’ petition.
  5. Whither Greece. Greece seems trapped in a crisis with no end.

And an extra cuddly version of our Gif of the Week.

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Greek CDS shenanigans

| October 28, 2011 | 20 Comments

By Theophilos on Flickr

We now know that private holders of Greek bonds will be “invited” (seriously–this was the word used in the EU summit statement) to take a write-down of 50%–halving the face value of the estimated $224 billion in bonds that they hold. This will help bring the Greek debt-to-GDP ratio down from 186% in 2013 to 120% by 2020. The big question–apart from how many investors they will get to go along with this, given that they couldn’t reach their target of 90% investor participation when the write-down was only going to be 21%–is whether this will trigger a CDS pay-out.

That this is even up for discussion is mind-boggling. These credit default swaps are meant to be an insurance policy in case Greece doesn’t pay the agreed upon interest and return the full principal within the agreed timeframe. If they don’t pay out when bondholders are taking a 50% hit then what’s the point? I call shenanigans. Continue Reading