Comments on: Will the FCIC report be a whitewash? A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: Danny_Black Sat, 04 Sep 2010 17:32:31 +0000 Well when it comes to writing a “collection of false statements, half truths, misunderstandings, confirmation biases, and rhetorical nonsense”, Ritholz is without peer. Virtually every single one of his claims are either complete BS or do not separate LEH from GS or MS or MER.

I think the reason the FCIC hearings are so unsatisfactory is that they seem determined to focus on the issue of capital or derivatives when the real issue for AIG and LEH was liquidity. For all the fuss repo 105 got, I have only seen one person comment online about the games they played with their liquidity pool and it is clear that LEH and BSC and others got into trouble because their liquidity dried up not because of the leverage and certainly not because of derivatives as most of the “problematic assets” were out and out real estate investments and leveraged loans.

By: Uncle_Billy Fri, 03 Sep 2010 23:16:04 +0000 Angelides? Dude, the calls are coming from inside the house. You know that.

By: y2kurtus Fri, 03 Sep 2010 20:02:32 +0000 Having lived through the crisis as a money manager at a local bank I can tell you that Lehman Brothers touched just about everyone. We’re a mutual savings bank in Maine and we held a small position in Lehman Bonds that we took an 80% loss on.

Having taken a painful haircut due to their failure it’s still hard for me to see what Fuld did wrong that Morgan or Merril did not do.

Try as they might to use the “no lawful method” excuse the fact is that they allowed the other investment banks MS and GS to apply as bank holding companies with in what… a week of Lehman’s failing?

I think 90% of the new financial regs are just extra red tape and expence for minimal new protection. Make all banks hold more capital 12 – 15% and make riskier activities like private equity and trading require more capital still like 20% and your regulatory system is far more sound than the one that existed in say 1970, 1980 1990 or 2000. If you’re going to mark everything to market leverage is a pretty dangerous thing.