Below are the 20 most recent journal entries recorded in thewestwind's LiveJournal:

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Friday, November 20th, 2009
4:28 pm	The State of Things It's been a long time since I posted on financial crisis related matters. This is partially a function of the doom seeming far less impending for a while now ... but that brings me to the impetus for this post: Behold the dueling Friday NYT Op-eds by David Brooks and Paul Krugman. There's an interesting contrast between the two. You could argue that there are a wide variety of explanations for why two people can look at the same set of facts and draw very different conclusions. For my part, it seems to me to be a sort of glass-half-full vs. glass-half-empty situation. To sum them up: Brooks: Geithner managed to get us off the road to instant ruin. Yay! Krugman: Geithner managed to move us onto the road to eventual, unavoidable ruin. Boo! (4 Comments |Comment on this)
Sunday, May 17th, 2009
6:29 pm	In the Irons ( Our rate of descent ... ) (2 Comments |Comment on this)
Tuesday, April 14th, 2009
11:32 pm	October, November, January, February Floyd Norris points out a fascinating maneuver by Goldman Sachs. Just change your fiscal year from starting in December to calendar year reporting, and make a whole month vanish. And jam pack that month with a wide variety of fascinating and unusual things that you would never want to be part on any quarter you are ever going to report on to your shareholders. Dirty pool. (Comment on this)
Thursday, April 2nd, 2009
10:25 am	If We Say It Quietly, Maybe No One Will Notice ... Dontcha love it when something boring yet significant, like new FASB guidelines on mark-to-market accounting of mortgage-backed securities, gets 4 short paragraphs in the AP feed ... and so far, not much in the way of further coverage. UPDATE: Oh wait, they haven't voted yet. Good job, Associated Press. (Comment on this)
Tuesday, March 31st, 2009
10:05 am	There's Me, Then There's You ( In International News... ) (1 Comment |Comment on this)
Wednesday, March 25th, 2009
11:05 am	Tilt the Field File this under 'Sensible Strategies': According to DealBook, Citigroup and Bank of America are buying up mortgage-linked securities at (secondary?) market (or even above-market) prices as fast as they can get their hands on them right now. Could that be because they intend to sell them shortly through the government-subsidized auction process at a higher price? Makes sense to me. You can't fault them for being clever and reading the situation correctly. With the non-recourse loans the Government is using to sweeten those future deals, the price is bound to be higher. So what if announcing this strategy has had the unintended consequence of temporarily increasing the total amount of crap on the books of these two most balance sheet impaired megabanks (so they can later maximize their future benefit from the Gov's assistance). The important thing is that they're acting rationally, right? (1 Comment |Comment on this)
Tuesday, March 24th, 2009
7:21 pm	In Love, War ... and Finance? This gem is from Steve Waldman's interfluidity blog, brought to my attention by Yves Smith's naked capitalism: ... I am filled with despair, not because what we are doing cannot "work", but because it is too unjust. This is not my country. The news of today is the Geithner plan. I think this plan might work very well in terms of repairing bank balance sheets. Of course the whole notion of repairing bank balance sheet is a lie and misdirection. The balance sheets we should want to see repaired are household balance sheets. Banks have failed us profoundly. We want them reorganized, not repaired. A world in which the banks are all fixed but households are still broken is worse than what we have right now. Too-big-to-fail banks restored to health are too-big-to-fail banks restored to power. The idea that fixing legacy banks is prerequisite to fixing the broad economy is a lie perpetrated by legacy bankers. (12 Comments |Comment on this)
Monday, March 23rd, 2009
2:20 pm	Return to Coda ( Fourth (?!) verse, same as the first.) ) (1 Comment |Comment on this)
Wednesday, March 11th, 2009
4:50 pm	Learn to Swim Here's a Nassim Taleb quote (via Krugman's blog, via an older Bloomberg piece) that I absolutely love: ``We refused to touch credit default swaps,'' Taleb said. ``It would be like buying insurance on the Titanic from someone on the Titanic.'' (Comment on this)
Sunday, March 8th, 2009
12:41 am	Shell Game The relationships between the Federal Reserve, Maiden Lane LLC II & III (these are SPVs set up so the Fed can act as a lender), AIG, and their counterparties, are nothing less than fascinating. Josh Marshall, in this Talking Points Memo entry tells the story of how the money has been shuffled around, and how AIG 'really' managed to lose $61B in 4Q 2008. (1 Comment |Comment on this)
Friday, March 6th, 2009
5:00 pm	A condundrum, wrapped in an enigma, wrapped in a twinkie Martin Wolf does a nice job of encapsulating the key aspects of the problem how to fix the banks. This explains the financial, ideological, and political aspects of the paradox we face with reference to each other in more detail than anything I have read to this point. (Bleh, you may need to follow the link from Google News to get to this without registering.) Updated with the counterpoint: Alan Blinder, in the Saturday NYTimes, does a nice job of giving the case against nationalization, but in so doing reiterates the urgency of actually dealing with the problems sooner than later. (Comment on this)
Thursday, March 5th, 2009
7:27 pm	Nero Plays an Encore Here's a quote from Krugman's blog that pretty much sums up the glumness I'm feeling: The sickening feeling of drift — the sense that policymakers are refusing to face hard facts, and are dithering while the world economy burns — just keeps getting stronger. (Comment on this)
12:49 pm	Holding Pattern ( Circling the drain ) (Comment on this)
Tuesday, February 17th, 2009
9:38 am	It's Not Just A River In Egypt ( Wherein I state the obvious ) (5 Comments |Comment on this)
Tuesday, February 10th, 2009
12:20 am	First Contact What happens when CNBC on-air personalities talk with academics who have lately been in vogue for seeing the big picture earlier than most? Hilarity ensues. (Via Felix Salmon, via Josh Marshall). (4 Comments |Comment on this)
Wednesday, January 14th, 2009
7:44 pm	Second Verse, Same as the First ... A Little Bit Louder and a Little Bit Worse So, after a brief holiday respite, fear is back( and surprise, and ruthless efficiency ... ) (Comment on this)
Monday, January 5th, 2009
9:10 pm	Black Swans, Mea Culpas, and VaR A long time ago (in financial crisis terms), ozy_y2k and I had a discussion on the application of modeling to finance, and the potential implications of doing a lousy job. It's a new year, and people are starting to ask what happened ... ( Some answers ) (2 Comments |Comment on this)
8:55 pm	An Overview of the Financial Crisis The NYTimes starts 2009 with a fine pair of articles describing where we are at, how we got here, and where we should go, in the form of two lengthy Op-Ed pieces by Michael Lewis and David Einhorn: The End of the Financial World as We Know It (Part I) How to Repair a Broken Financial World (Part II) If you've read nothing at all about the happening of the last three months, this would get you up to speed in a hurry. (Comment on this)
Thursday, December 18th, 2008
7:28 pm	It's Just Not Widely Distributed ( (Dis)solution: ) (Comment on this)
Tuesday, December 2nd, 2008
12:55 pm	One Door Closes Replace default with recovery, and you can have a new (yet oddly similar) ballgame. And so, a new class of unregulated instruments can be used to build a house of cards, and wreak havoc somewhere down the line. Instead of betting on the bankruptcy, bet instead on what the bondholders will get on the dollar once it happens. Sheesh. (Comment on this)