Monthly Archives: June 2011

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Commentary: Movies ‘Inside Job’ and ‘Too Big To Fail’ entertain but don’t explain the panic

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From the editor: The new financial-crisis movies “Inside Job” and “Too Big To Fail” are riveting tales of Wall Street and its giant banks, but don’t expect to find out why taxpayers were forced to bail out those big banks … Continue reading

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European repo leader wary of transparency

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The European repo community appears to be worried that regulators will require the repurchase market to become more transparent, based on a top repo official’s comments in a Financial News column June 13. Godfried De Vidts, chairman of the European Repo Council, … Continue reading

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Some experts are comparing Greece to Lehman

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If eurozone officials decide Greece does not have to repay its debt in full, the European Central Bank says it may stop making repo loans to financial institutions that put up Greece’s debt as collateral, according to a June 10 story by the … Continue reading

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Financial reforms have not fixed the problems

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The recent financial reforms are focused on making commercial and investment banks stronger, but they ignore the real problem in the financial crisis of 2007 and 2008, which was runs on the shadow banking system, banker Michael Pomerleano wrote in the Financial Times’ … Continue reading

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Repos and money market funds may need a public safety net

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If future credit needs will be met in part by shadow banking, as they were prior to the financial crisis, then we may need to bring repurchase agreements and money market funds, which provide much of the funding for the … Continue reading

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Banks prepare to fight Basel’s repo-related ratios

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The only rules that have been proposed specifically to lessen the systemic risk caused by the repurchase market will force the largest banks to do business in a more cautious way, and the banks are gearing up to fight them, … Continue reading

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Banks’ over-reliance on overnight repo is “absurd”

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Enrico Perotti, professor of international finance at the Amsterdam Business School, wants to tax banks that repo, to discourage “the current absurd over reliance on overnight repo markets.” He is highlighting the following papers on his web site. From The Governance … Continue reading