Felix Salmon

Taleb and Feyerabend

Back in March, Scott Locklin’s second-ever blog entry was a takedown of my Wired article which ended with this:

Financial innovation

In my blog entry this morning about Robert Shiller and his bonkers defense of subprime mortgages, I made an en passant reference to financial innovation being, net-net, a bad thing. I didn’t go into too much detail, because it wasn’t all that relevant to the point at hand, and because, as Sean Matthews pointed out, this question has been debated in the blogosphere in some depth in the recent past.

CIT kicks the ball down the road

What are the chances of this CIT deal actually preventing a bankruptcy filing, rather than just delaying it for a few months? At first glance, it would seem that the chances are good: why else would bondholders throw $3 billion of good money after the bad money they’ve already invested? But at second glance it’s not so simple: that $3 billion in new funding not only carries a double-digit interest rate, but is also secured by a whopping $10 billion in assets.

Shiller tries to defend subprime mortgages

Robert Shiller thinks that creating a Consumer Financial Protection Agency “seems a good idea”, but is also a fan of financial innovation:

Right-to-rent gets more traction

Obama administration officials are now going on the record when it comes to what I’ve been calling the Baker-Samwick proposal but which Dean Baker has now much more pithily rechristened the right-to-rent plan:

How debt becomes equity, REIT edition

Phil Wahba and Ilaina Jonas report:

Several large investment firms are creating new lending companies that plan to go public to raise billions of dollars to take advantage of the distress in the commercial real estate market, and more are on the horizon.

Abolish the FSA!

There should be as few financial regulators as possible, and they should be as powerful as possible. So this is a good idea, I think:

Blogging magazine articles

Yvette Kantrow has a truly astonishing parenthetical in her peculiar piece on the CJR, Goldman Sachs, and Matt Taibbi: