Felix Salmon

Sell-side snafu of the day, JP Morgan edition

atpg.tiff

This is the stock chart for ATP Oil and Gas over the past five days: it plunged at the open on Tuesday and then soared at the close today. And it’s all because of Joseph Allman, the analyst for ATP at JP Morgan

Congress approves Basel III before it even exists

Assistant Treasury secretary Mike Barr celebrated the passage of the financial reform bill today by phoning me up for a chat. So of course I asked him how much has really been achieved, and how much the really important stuff has been left to the Basel III negotiation process.

Goldman agrees to carry on as usual

My favorite part of the SEC settlement with Goldman Sachs is the bit where Goldman agrees to “a permanent injunction from violations of Section 17(a) of the Securities Act of 1933″. Well, that’s reassuring, knowing that from now on Goldman has promised not to break the law. Goldman has also consented to an agreement that when it puts together new mortgage securities, it’ll run any prospectuses or term sheets by its legal or compliance departments. As if it wasn’t doing that already. And there’s lots more like that: people on the mortgage desk have to attend training seminars on disclosure! Goldman “shall provide for appropriate record keeping”! And so on and so forth.

Goldman’s win

Goldman Sachs has come to a settlement with the SEC: it will pay $300 million in fines, and another $250 million in restitution, according to the NYT. There’s no indication that any Goldman executives are being forced out: this is a purely financial settlement, and does not even include Goldman admitting any wrongdoing.

Can behavioral economics cause real harm?

George Loewenstein and Peter Ubel are about as expert on behavioral economics as it gets, so it’s interesting that they’ve taken to the op-ed page of the NYT today to urge politicians to spend less time on nudges and more time making substantive policy changes.

The big problem with Europe’s stress tests

Can Europe’s bank stress tests do for banks over there what the US tests did on this side of the pond? Mohamed El-Erian is not optimistic:

Reporting and lobbying in Basel III

The WSJ has its own Basel III update today, which recapitulates most of what we learned yesterday. But there’s one new twist — or new emphasis on an old twist, I’m not sure which. When it comes to proposed liquidity requirements, says the accompanying graphic, “the proposal could cause huge funding shortfalls for banks world-wide.” And the article elaborates:

How can Benmosche be tamed?

Robert Benmosche is probably the highest-paid public-sector employee in America: his $10.5 million salary means that he takes home Barack Obama’s $400,000 annual pay every two weeks. And yes, Obama is his ultimate boss.

Counterparties

Steinbrenner pays no estate tax; this is “a social scientist’s fondest dream” — Improbable Research