The Institutional Risk Analyst: Why Big is Bad; Alex Pollock on Sarbanes-Oxley and the Financial Crisis – Christopher Whalen – In this issue of The IRA, we discuss why Big is Bad when it comes to large banks. Then we feature a comment by Alex Pollock on “Sarbanes-Oxley in the Light of the Financial Crisis”
————
Massachusetts May Drag Feet On Seating Republican If He Wins To Save The 60th Vote On Medicare – Joe Weisenthal – A clever way of overturning the will of the people. – The Business Insider
————
White House credits stimulus with up to 2M jobs – AP Yahoo
————
Fed’s Dudley Says Rates May Stay Low for as Long as Two Years – by Joshua Zumbrun – New York Federal Reserve Bank President William Dudley said short-term interest rates may remain low for at least six months and possibly for as long as two years. “Short-term rates are going to stay low for a considerable period of time to come,” Dudley said yesterday, according to the transcript of an interview with PBS Television’s Nightly Business Report. – Bloomberg
Obama Bank Fee to Hit 50 of the Biggest U.S. Financial Firms – By Julianna Goldman – Bloomberg
————
Interest Rate Outlook – … So, what comes next? … The fed is now interested in “testing” the strength of this recovery. How does it do that? By letting long term interest rates rise to where the market thinks they should be. Think of it as an experiment. How will the fed facilitate this experiment? By slowly shutting down its asset-purchase programs. … – Surly Trader
————
Fanning Fannie worries – By PAUL THARP – As the White House pushes its plan to yank billions in taxes from financial firms, two of the biggest and dysfunctional companies are getting a free pass. Mortgage finance giants Fannie Mae and Freddie Mac are exempt from the proposed tax, despite having played central roles in the financial crisis. – NY Post
————
Banks, experts eye possible ways around Obama fee – By Dan Wilchins – No sooner does Washington propose a new tax than an army of experts tries to figure out ways to avoid it. That is already the case with U.S. President Barack Obama’s proposed fee on banks, designed to ensure that Wall Street banks pay up to $117 billion to reimburse taxpayers for the financial bailout: Bankers, lawyers and consultants are already considering ways to avoid paying the fee. “This law could be a real boon for lawyers and consultants like me. There are tremendous opportunities for coming up with new mechanisms to avoid it,” said Bert Ely, a bank consultant in Alexandria, Virginia. – Reuters
————
Administration Releases December Loan Modification Report, Update on Conversion Drive – More Than 850,000 Homeowners Now with Median Payment Reductions Exceeding $500; More Than 100,000 Permanent Modifications Approved to Date – Aggressive Administration Campaign Significantly Accelerates Conversion Rate; December Push Doubles Number of Permanent Modifications Over Life of Program – thanks Marty Rosenblatt – US TreasuryPress Release
————
The Coming Sovereign Debt Crisis – Nouriel Roubini and Arpitha Bykere – Will investors move out of their ‘’safe haven” markets? – In 2009, downgrades and debt auction failures in countries like the UK, Greece, Ireland and Spain were a stark reminder that unless advanced economies begin to put their fiscal houses in order, investors and rating agencies will likely turn from friends to foes – Forbes
————
Fannie, Freddie Cost the Government $291bn in 2009 – DIANA GOLOBAY – HousingWire
————
On the ending of QE – When the Fed Stops the Music – John Mauldin’s Thoughts From The Frontline – … This is yet another uncertainty. We simply have no idea, no relevant marker, for what happens when a country goes so cold turkey, coming off a central bank bond-buying binge. And this in the midst of a massive deleveraging and with stock market valuations basically where they were in 1987 – except there was at least large earnings growth then. … – Investor’s Insight