Felix Salmon

The US default-risk meme

March 25, 2010

There’s a constant drumbeat of stories about how the price of credit protection on the USA says little if anything about America’s creditworthiness: Dan Gross had one just last week. I’ve written much the same story myself, but at least I tried to explain what was actually going on in that market; what I’m still waiting for is a journalist who can find someone who’s actually buying or selling these things, so that we can find out from the horse’s mouth why they’re doing so.

Iowa cracks down on Ben Stein’s sleazy paymasters

March 24, 2010

Ben Stein has a bit of free time on his hands these days, now that his odorous association with FreeScore.com and its sleazy owners Vertrue means that he’s no longer writing a column for the NYT. So he might be interested in reading the blistering 62-page ruling that Judge Robert Hutchison has just handed down in Iowa, which goes into great detail about how Vertrue has violated all manner of laws in that state with its unfair and deceptive practices.

Howie Hubler’s second act

March 24, 2010

Loan Value Group has one of the best ideas I’ve seen in the housing crisis so far. It involves no legislation or government cash, it keeps homeowners in their home, it prevents distressed foreclosure sales, and it benefits both borrowers and lenders. In a world where the pervasive problem of negative equity is signally failing to turn up in significant principal reductions, LVG has come up with a clever way of doing something substantially similar, without lenders having to take the hits to their balance sheet which are necessary when they do an immediate principal write-down.

Blogonomics: The Gothamist sale

March 24, 2010

Gawker and Gothamist were both started in 2003, and both grew to become big blogs; it’s interesting, now Gothamist is being sold to Rainbow Media, to see Gawker’s Nick Denton’s weird attempt to downplay the achievement of Jake Dobkin and Jen Chung.

The FDIC: An IMterview with Heidi Moore

March 23, 2010

Heidi Moore has a good story today about the banks winning the FDIC lotto and being allowed to take over the assets and deposits of other, failing banks. But I was left wanting more, especially when it came to her conclusion, so I took to IM:

A FAB idea?

March 23, 2010

Matthew Bishop has a short piece on a new campaign called FAB, for Financial Access at Birth: the idea is explained in more detail here.

Regulatory reform goes to the full Senate

March 23, 2010

Back on March 11, when Chris Dodd put financial reform on a forced short timetable, I said that “financial reform is not dead yet: we’ll have a much better idea at the end of next week what its real chances are”. Well, that date has been and gone, and now a bill with no Republican support has been pushed through the Senate banking committee in a move that Bob Corker called “pretty unbelievable”. And yet, reform is still not dead: Dick Shelby, for one, sounds reasonably constructive when he says that “we’re not going to the floor polarized; we’re going to the floor right now in the spirit of trying to work a consensus bill, a meaningful, substantive bill that I’ve said all along that we need.”

Inside a not-bailed-out bank

March 22, 2010

People have many legitimate reasons to have a grievance against their bank. In fact, it’s rare to find someone who hasn’t been extremely angry at their bank at some point. But rarely is there a case as clear-cut as this one, from Aaron Elstein: