Maine Senator Angus King Wants To Make Banking Boring Again

Here’s a truly terrible advertising tagline that could go nowhere on Madison Avenue: “We make bank boring again”. But is it feasible that Wall Street needs this slogan? Senator Angus King of Maine, an unbiased who has been dealing with prominent Republicans and Democrats, says yes. Five years following the financial collapse, King is wanting to bring the Glass-Steagall Take action back, originally created after The Great Depression to split up commercial and investment bank. That restriction was later repealed in 1999 under the Clinton administration. He joins Marketplace Morning Report host David Brancaccio to explain. Click on the audio player above to listen to more.

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  • Describe the main top features of futures, forwards, swaps and credit derivatives

500 million of additional capital. 2 billion it invested in WaMu in April. 6 billion funds it raised this year to make distressed investments in the financial sector, according to a TPG investor. Ok, we know the situation is desperate though. TPG have access to the books. I don’t. They waived their anti-dilution clause so they are clearly willing to get diluted to protect some value in their position.

That is the true indication of problems here. The waiving of the anti-dilution clause is however a GOOD thing for the most well-liked holders. Extra equity capital (diluting but not wiping out TPG) strengthens, not weakens the positioning of the preferred. However TPG are also stating “get me out of here” and given that they have access to the books I will not be comforted by that.

That is the fill. Its fill however constant with my thesis. If the deficits are 19 billion WaMu has enough capital to survive “only. If more – then problems. According to one bank source not mixed up in the sale process, any buyer would face immediate mark-to-market stresses from WaMu’s mortgage portfolio.

The first phrase gives it away. WaMu is a “sale process” because this journo is distinguishing between people in the know and folks like me who are just interested outside observers. The exterior source however has nailed the obvious problem with “buying WaMu” which is that WaMu’s property is mismarked – and the mismark would be shown by any purchase.

1 a talk about) would solve several problems though since there is a great deal of “stated capital” still left at WaMu even when there is very little real capital. A deal whereby someone injects equity and retains a choice to buy solves the mark-to-market problem referred to. That could be the reason that deals are taking the forms stated. 40 billion bad (despite having a charge paid to the FDIC) also solves the marking problem. I am uncertain if the FDIC gets the legislative power to cut such an offer.