Free Republic

Before its collapse Friday, wokesterism surrounded Silicon Valley Bank like a miasma.The wokesterly attentiveness didn't per se destroy that mid-sized bank, given that most banks play these games and the big ones are very loud about it.As I noted earlier, Johns Hopkins University professor of economics, Steve Hanke, put his finger on the problem more precisely in an email:[T]he real SVB issue was terrible banking and risk management that resulted in a massive duration mismatch between SVB's liabilities (read: deposits) and its assets (read: long-dated bonds). The mismatch was stupidly not hedged. SVB was a poorly run bank, a disaster...

It’s not often that job cuts in the City of London make the same sort of headlines as layoffs at a car plant in Swindon or a steelworks in Scunthorpe – so you know something’s up when the 18,000 job losses at Deutsche Bank hit the front pages of all the wrong newspapers. The decision by Deutsche Bank to finally throw in the towel on its 25-year attempt to build a global investment bank to rival the Wall Street giants is a parable of the past 25 years in global banking. You might even say it was the moment that...

The Republican Party has taken a page straight out of the campaign books of Bernie Sanders and Elizabeth Warren. What? No, we’re not kidding. In the party’s 2016 platform, the GOP advocates for reinstating the Glass-Steagall Act, a Depression-era law that regulated the U.S. banking industry until it was repealed in 1999. Bringing the law back would lead to the breakup of major U.S. banks like JPMorgan Chase in order to separate investment banking from commercial banking. …

"RBS has been a bruising place to work ... and that doesn't sit well with me," the Royal Bank of Scotland CEO McEwan said on Thursday. "We will work hard to make [RBS] a much better place for our people." McEwan mentioned on a conference call last week that there would be "substantial job losses" and that "we haven't got a number out there because we've got a lot of consultation to do with our people." Little did his staff know that this meant about three out of four people working in the investment banking part of the bank would...

FDR's Raw Deal Exposed August 30, 2003 BY THOMAS ROESER For 70 years there has been a holy creed--spread by academia until accepted by media and most Americans--that Franklin D. Roosevelt cured the Great Depression. That belief spurred the growth of modern liberalism; conservatives are still on the defensive where modern historians are concerned. Not so anymore when the facts are considered. Now a scholar at the libertarian Cato Institute has demonstrated that (a) not only did Roosevelt not end the Depression, but (b) by incompetent measures, he prolonged it. But FDR's myth has sold. Roosevelt, the master of the...

For decades, investment bankers have held the key to untold riches -- but now they're being laid off by the tens of thousands. As the crisis forces the industry to search for a new identity, is it ready to mend its ways? The suicide victims chose a location with symbolic significance. Last fall, only a few weeks apart, a businesswoman and a banker went to the Coq d'Argent, an upscale restaurant and hot spot in the world of London high finance, located on the top floor of a shopping complex, to end their lives. The woman put down her purse...

I've seen many explanations of what investment bankers actually do, but they've all been either bad or boring. I can sum up what we do in 2 words and 1 picture:Ari Gold.Investment bankers are agents, just like Ari.We don't create anything and we don't buy anything; we just sell things that aren't ours to begin with.And we make a lot of money doing that, thank you very much (more on investment banker salaries).Business::EntourageIf the business world were like Entourage, bankers would be the agents, private equity firms and large companies would be the studios, and companies would be the actors...

Simply said: when one truly digs in, MF Global exposes the 2011 equivalent of the 2008 AIG: virtually unlimited leverage via the shadow banking system, in which there are practically no hard assets backing the infinite layers of debt created above, and which when finally unwound, will create a cataclysmic collapse of all financial institutions, where every bank is daisy-chained to each other courtesy of multiple layers of "hypothecation, and re-hypothecation."

A year ago I wrote about the sad story of the Simmons Mattress company, a well run outfit that got caught in the cross hairs of the investment bankers, and while they never had a problem making and selling mattresses at a profit they were bought and sold by a series of investment bankers, each one artificially pumping up the book value of the company, borrowing against the inflated value to pay themselves outrageous fees and to repay their investment, and ultimately driving the company into bankruptcy. Factories closed, people were laid off, suppliers short-changed, as the investment bankers took...

One of the penalties I pay for living on the North Shore is having underemployed investment bankers as neighbors. Smart enough guys, only a few years ago capable of buying large houses with cash, now left to rake leaves and shuttle kids around. A neighboring bond trader wandered over to our house earlier this week with a family carload for a noisy dinner (beef, noodles, and beer if you must know). I mentioned that he has been around home a lot assuming a lack of work in his trading area. Somewhat surprisingly I was wrong. A lack of pay has...

Investment banking model is dead, says Roche By Anette Jönsson | 29 September 2008 David Roche gives his view on what the financial sector will look like after the current credit crisis, which he says was created by excess liquidity and the shift to a "new monetarism" model. The financial sector will look very different after the current financial crisis with a dramatic increase in regulation, slower credit growth and a forced return to a traditional relationship banking model where banks fund themselves primarily through deposits, argues David Roche, president of London-based global investment consultancy, Independent Strategy. “The wholesale money...

Standing outside the Capitol in Albany one summer afternoon in 1998, Eliot Spitzer released a statement that said if he became attorney general, he would use the considerable power, influence and bully pulpit of the office to "take on all the problems that have led to governmental stagnation and corruption in New York." During his nearly six years in office, Mr. Spitzer has indeed claimed the mantle of reform. But he has done it by focusing on the financial and insurance industries - not state government. Mr. Spitzer has built a nationwide reputation as an aggressive pursuer of corporate malfeasance....