from Counterparties:

Standard incompetence

August 20, 2014

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Standard Chartered’s compliance department is apparently pretty bad at complying. In 2012, the bank was fined $340 million for hiding transactions with sanctioned Iran. As part of the settlement, Standard Chartered bank (SCB) was required to “remediate anti-money-laundering compliance problems,” Dealbook’s Ben Protess and Chad Bray report, and hire an outside monitor to judge whether the problems were in fact remediated.

from Counterparties:

Putting stock in the market

August 18, 2014

Robert Shiller wants us to talk about stock prices. “We are in an unusual period, and that it’s time to ask some serious questions about it,” he says.  Specifically, Shiller wants to discuss just how far above normal they currently are:

from Counterparties:

Hungry, heavy and poor in America

August 12, 2014

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America’s hungriest region is also its heaviest,  Eli Saslow reported as part of his Pulitzer Prize-winning investigation. Saslow documented the perverse coincidence of hunger, obesity, and poverty in Texas’ Rio Grande Valley. In one county in the region, 32 percent of the residents are obese and 40 percent have been severely hungry in the last month. The problem is complex, but the crux of it comes down to trying to feed families on minuscule budgets and limited aid. “It is unrealistic to expect someone stretching their dollars to be highly worried and focused on nutritional content,” Saslow quotes a food policy analyst saying. “They just need to eat.”

from Counterparties:

Inverted tax logic

July 30, 2014

Tax arbitrage trend stories are rare – the last time we had one was the summer of 2012 when carried interest was all the rage. Now we have another. Corporate America’s hottest new tax avoidance strategy is the inversion. This structure has everything: acquisitions of non-U.S. domiciled companies, presidential umbrage at a lack of C-suite patriotism, unreliable data, proposed but unlikely to ever be enactedlegislation, and Mark Cuban twirling a basketball and tweeting his opinion.

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Weeding out the prison population

July 28, 2014

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The New York Times’ editorial board – America’s barometer of what cautious, moderately liberal elites are supposed to think  – wants America’s war against weed to end. States, they say, should be allowed to make their own marijuana policies. And states already are: nearly three-quarters have reformed their marijuana laws to legalize all use, medical prescriptions, or cut the consequences of possession.

from Counterparties:

A guide to Paul Ryan’s anti-poverty plan

July 24, 2014

Like Ronald Reagan, Paul Ryan thinks that we’ve lost the war on poverty. Ryan, the chairman of the House Budget Committee, released a draft anti-poverty plan today. About 45 million Americans are living in poverty — making less than $23,850 for a family of four — and Ryan’s proposal would “shift the federal government's anti-poverty role largely to one of vetting state programs to distribute aid,” Reuters’ David Lawderreports. Benefits would be distributed by a single agency or charity group, and recipients would be required to set up and follow a contract to receive benefits.

from Data Dive:

Facebook leaves niche competitors behind

July 23, 2014

These are good times for Facebook. The social media site reported second quarter earnings of $0.42 per share and revenue of $2.91 billion on Wednesday afternoon. Analysts polled by Thomson Reuters expected $0.32 in earnings per share and revenue of $2.8 billion. The company's stock is up just under 1% in after hours trading. Reuters' Stephen Culp charts Facebook's share price relative to the S&P 500 and five of its competitors. The comparison is striking and decidedly in Facebook's favor.

from Counterparties:

Obamacare’s circuitous path

July 22, 2014

U.S. federal courts don’t agree on whether the federal government is allowed to subsidize health insurance costs. The final decision, which seems likely to be made by the Supreme Court, will have massive political, economic and human impact. Not only does healthcare make up 18% of U.S. GDP, but the idea that the federal government can subsidize insurance is a key to the Affordable Care Act and the health insurance of more than 5 million Americans.

from Counterparties:

Bank of Inchoate Sense

July 18, 2014

Brad DeLong is confused. The Berkeley economics professor has read the Bank for International Settlements' (BIS) – often called the central bank for central banks –annual report and he just cannot understand what its positions on the global economy and monetary policy actually are: “It calls for raising interest rates now... It fears activist expansionary fiscal policy even more than it fears monetary ease... It seems hostile to any increase in the demand for risky assets.”

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Losing participation points

July 17, 2014

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Today, the White House tried to answer one of the thorniest questions about the U.S.’s post-recession economy: why, despite the recovery, has the percentage of working-age Americans that are either working or looking for work steadily fallen? At the beginning of the recession in December 2007, what economists call the labor force participation rate was 66%. It is currently 62.8%, the lowest it’s been since the 1970’s.