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’US stress test results
Yes, the results of the Supervisory Capital Assessment Program (SCAP) are finally out and you can find them here.
In the meantime here’s a quick summary:
10 of the 19 firms tested need to add $185bn to their capital buffers.
Financial figures through Google goggles
Guido Fawkes has alerted us to the fun to be had with the new predictive function on Google searches.
While most of them reveal a worrying anti-semitic streak (even in the case of Allen Stanford, who by all accounts is a rather fervent Christian) and an obsession with public figures’ wives,
Geithner sparks banks rally
Tim Geithner, US Treasury secretary, on Tuesday sparked a rally in financial stocks after he said the “vast majority” of US banks are well-capitalised and assured investors that the government would not wipe out their holdings.
FDIC and the magical accountant: a financial fairytale
Once upon a time there was a princess called Sheila.
Sheila was in charge of a small but important slice of the Kingdom, known as FDIC.
All was well in Sheila’s fiefdom. Since the Glass-Steagal Revolution she had ruled over FDIC,
US prepared to oust bank chiefs
US Treasury Secretary Tim Geithner warned on Sunday that the US government would consider ousting board members at American banks as a condition for giving the institutions “exceptional” assistance in the future.
US reveals regulatory overhaul
The Obama administration plans to introduce more stringent rules on capital and liquidity as part of a sweeping regulatory overhaul outlined by Tim Geithner, US Treasury secretary, on Thursday. Geithner told Congress that the US needed a fresh approach to regulating risk that identified problems across the financial system as a whole.
Geithner’s game plan
Full text, with highlights, below.
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Introduction
Thank you Chairman Frank, Ranking Member Bachus, and other members of the Committee. I appreciate the opportunity to testify about the critical topic of financial regulatory reform.
Geithner not wrong, simply misunderstood
Poor old Tim Geithner, he can’t seem to earn the trust of the markets whatever he does. Wednesday saw the US Treasury secretary rattle forex traders specifically with comments about China’s proposals on special drawing rights.
Dollar dips on Geithner’s ‘loose talk’
The dollar fell briefly by 1.3% against the euro on Wednesday after US Treasury secretary Tim Geithner suggested the US was open to exploring a Chinese proposal to reduce reliance on the dollar as the world’s reserve currency.
The tabular banking-PPIP disconnect
Zero Hedge has a very interesting table from Goldman Sachs. Click to enlarge.
It shows Goldman’s estimates for how banks are carrying assets like commercial mortgages and consumer loans on their books.
Structured credit cool on the Geithner Plan
As we know, equity markets greeted the Geithner toxic asset plans with joy – the Dow registered its fifth-biggest point gain in history.
The reaction in the structured credit markets on Monday was less enthusiastic as this this graphic from Bernstein Research highlights
The structured credit markets did show some positive reaction,
Further reading, all about the Geithner PPIP plan
Across the FT and the blogosphere, responses to the US Treasury’s Public-Private Investment Program,
FT editorial comment:
No one knows whether the market malfunction is due more to long-term losses or short-term liquidity risk.
Global financial crisis, solved?
The S&P 5oo closed 7.1 per cent higher on Monday, while the Dow added 497.48 points, or 6.84 per cent.
This calls for a graphic:
You decide.
Related links:
A lasting rescue rally? – John Authers / FT Short View
The Geithner plan – it’s all about liquidity – FT Alphaville
Geithner,
Geithner – My Plan for Bad Bank Assets
From Monday’s Wall Street Journal:
Today, we are announcing another critical piece of our plan to increase the flow of credit and expand liquidity. Our new Public-Private Investment Program will set up funds to provide a market for the legacy loans and securities that currently burden the financial system.
White House to unveil assets plan
Tim Geithner, US Treasury secretary, will on Monday unveil details of a plan to take hundreds of billions of dollars of toxic assets off banks’ balance sheets. The plan, for the Treasury to put $75bn to $100bn of troubled asset relief funds into a public private investment scheme,
AIG chief urges return of bonuses
Edward Liddy, chief executive of AIG, on Wednesday urged employees to return the $165m in bonuses that have sparked public anger against the troubled insurer. He told legislators he had asked staff at AIG Financial Products – the arm that brought AIG to the brink of collapse – to “do the right thing”.
Geithner faces critical test over plan
US Treasury secretary Tim Geithner faces a critical test of his credibility when he unveils a much-awaited plan to take toxic assets off bank balance sheets – expected in coming days. Geithner, whose initial announcement last month on the troubled asset purchase plan disappointed the market,
That’s nice Timmy, but we’ve got a few suggestions…
Apparently, the Goldmanati are concerned.
For starters, the new Treasury Secretary, Timothy Geithner, never worked at The Firm. For a second, he’s not exactly got the confidence of the markets at the moment.
CDS update: Markets boo Geithner
This CDS report was written by Markit’s Gavan Nolan
Investors gave the much-anticipated Financial Stability Plan a resounding thumbs-down after it was published this afternoon. The Markit iTraxx Europe and Markit CDX IG indices widened sharply as details of the new government measures became clear.
‘Financial stability’ unveiled
The factsheet, selected highlights in bold.
The Financial Stability Plan: Deploying our Full Arsenal to Attack the Credit Crisis on All Fronts. Today, our nation faces the most severe financial crisis since the Great Depression.
Markets Live US – Bad Bank edition
Its BOGOF day here on FT Alphaville and that means a second helping of Markets Live.
Join Stacy-Marie Ishmael and Neil Hume at 4.00pm (11.00am EST) as US Treasury secretary Tim Geithner launches the next phase of the great bank bail out plan.
Obama hardens bail-out line
Barack Obama’s administration has stepped up pressure on US lawmakers, threatening to force them to work through their one-week recess starting Friday, to get the $800bn economic stimulus package enacted as soon as possible.
US banks surge on Geithner remarks
Beaten-down US bank stocks surged Wednesday as new Treasury secretary, Tim Geithner, played down talk of nationalisation, fuelling hopes for a comprehensive clean-up of toxic assets on terms palatable to investors.
US says China ‘manipulating’ currency
Tim Geithner, President Barack Obama’s choice for Treasury secretary, on Thursday accused China of “manipulating” its currency and pledged “aggressive” diplomatic action on the issue. The comment,
Geithner pledges ‘dramatic’ action
The Obama administration will take action on a “dramatic scale” to revive credit markets and strengthen banks so they are able to lend, Treasury secretary-designate Tim Geithner said Wednesday. Testifying to the Senate committee considering his nomination,
Madoff, Finra, and the woman who would be SEC chair
Mary Schapiro is Barack Obama’s nominated candidate for the post of SEC Chair. Today she faced a grilling from the Senate, which by all appearances, should have been a tough one.
Why? Primarily because of the Obama camp’s pointed recent criticism of SEC incumbent Chris Cox.
Contenders jockey for NY Fed role
The jockeying to succeed Tim Geithner, Treasury secretary-designate, as head of the New York Fed is beginning as the bank’s board prepares to create a search committee to select a candidate for the $398,200-a-year job.