Chasing shadows
FT Alphaville suggested on Wednesday that Dodd-Frank is likely to be a bigger boon to the shadow banking system than — as others have suggested — to European banks. We’re still getting our heads around...
View ArticleMMFs, deposit insurance, and regulation in the age of shadow bank runs
Deposit insurance on non-interest bearing accounts — it was in October 2008 that the FDIC started it, through the Transaction Account Guarantee, or TAG. Until we looked a bit more closely, we hadn’t...
View ArticleThe inevitability of shadowy banking (and how to regulate for it)
FT Alphaville decided earlier this week that we are sick of the term “shadow banking”. We’ve failed to come up with an alternative, however, and in the meantime Edward Kane, a professor at Boston...
View ArticleETFs, unregulated banks in disguise
If one article sums up how ETFs have come to change the market structure of the equity universe, it’s this one from Paul Amery at Index Universe on Thursday. As he recounts, the thing that really...
View ArticleThe negative carry universe
This is a follow-up to our post on “base money confusion“, which incorporates some of the ideas we’ve raised in our “beyond scarcity” series. Let’s assume a few truths (we’re sure they’ll be up for...
View ArticleChina’s bad-debt nightmare
Not our words but Societe Generale’s, or at least their China macro strategist Wei Yao, who believes credit risk is worse than official non-performing loan data suggests. So much worse that — while...
View ArticleIs leveraged lending guidance effective? Yes, no, maybe
Last year the Federal Reserve and the Office of the Comptroller of the Currency issued new leveraged lending guidance designed to discourage big banks from underwriting risky new loans. Off the menu...
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It all makes sense when you realise there are TWO US dollar currencies
Most people know that China’s currency is classified according to trading conditions. There is, for example, CNY, which refers to onshore yuan. There’s CNH, which refers to Hong Kong (offshore) yuan....
View ArticleMarketplace lenders and the Chinese path to a gift-card economy
Most of us know it as shadow banking. Others refer to it as non-bank lending. But a whole new nomenclature — “market-based financing” — is growing in popularity, making the whole thing sound a lot less...
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If Google mapped the financial system…
This is a Google Map of the City of London: It’s a “square mile” because back in the day — before phones, fax machines or the internet was invented — representatives from the key settlement banks had...
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