This is how beggar-thy-neighbor monetary policies work, and perhaps why they ultimately fail.» Read More
Here's some good news: it's the anniversary of the Flash Crash and we know what caused it.
Many things that happen in financial markets remain mysteries for perpetuity. The causes of the housing boom and bust, for instance, are still debated by economists. Was it the Fed's loose money? Deregulation in banking? Perverse pay incentives? Government housing policy? We'll be debating this forever.
But the Flash Crash is different. We know how it happened.
Just days before the highly-anticipated secondary offering of American International Group shares is set to be marketed to investors, the sellers are at loggerheads with the bankers they have hired over where to price the deal, say people familiar with the matter.
The fiscal challenges facing states is not new and the budget battles we saw in both Wisconsin and Ohio just showcases the problem. One of the biggest challenges states are facing when tackling their budget shortfalls is their pension deficits. States like California are so in the hole they're looking at over $500 billion in shortages.
The Garden State—New Jersey— is staring down a $46 billion dollar deficit and Illinois is faced with a $78 billion of red ink. But in times of crisis, ingeniuty and creativity can take a leading role. In Utah, Alaska and Michigan they are tackeling their pension problems head on. I caught up with pension plan expert and lawyer Marica Wagner on what kind of options states can do to right their lopsided pension balance sheets.
Why should Goldman Sachs be "freaked out" by the Volcker Rule, and lobbying hard to debilitate it?
Goldman Sachs is 'totally freaked out' by the Volcker Rule . Oh and can someone please tell me waht 'backstairs bets are? [Reuters]
It's hardly surprising that Goldman Sachs wants to be able to deploy the firm's capital to longer term investments.
What is surprising is that Goldman reportedly has to lobby regulators to be able to do this. On it's face, nothing in the Volcker Rule should prohibit longer term investment.
The Volcker Rule is set out in Section 619 of the Dodd-Frank law. The blog Economics of Contempt nicely explained this section back in March .
In today's high-tech age, your smartphone can be your concierge, navigator, websurfing device and of course a phone.
But with this "freedom" and "technological advances" your privacy could be in jeopardy. Sony's second cyber attack in a matter of weeks just shows that while we may be light years ahead in terms of convenience, the fabric making up the network that gives us this freedom is in need of repair.
So just how vulnerable are we? I asked Dave Jevans, founder and chairman of IronKey, which provides various cyber security services. He is also the chairman of the Anti-Phishing Working Group which tracks and quantifies phishing attacks and fake websites.
It's almost a heresy to suggest at the Milken Institute Global Conference that we may have too much financial innovation.
The Milken Institute, of course, is named for one of the most famous living financial innovators, Michael Milken. Much of the work of the institute is dedicated to finding innovative ways to ameliorate the world's ills.
If raising the margin requirement—or downpayment—on silver contracts helped cool speculation in the metal this week, could it do the same thing for runaway oil prices?
This is how beggar-thy-neighbor monetary policies work, and perhaps why they ultimately fail.
UBS has reacted to the financial market turbulence by freezing salaries for its investment bankers until at least mid year. The FT reports.
Janet Yellen is expected to attempt to balance raising interest rates against the risks of a weaker global economy.