Post Dodd-Frank: The Future of U.S. Banking and Financial Regulatory Reform

Interesting article over at Seeking Alpha from David Warsh on this topic. You can read it here, and below are my thoughts:

David,

Great article and I completely agree with you that Dodd-Frank doesn't go far enough in putting our banking regulation back on sound footing. Also, great to see SA Editors putting this topic in the Editor's Choice spotlight.

And if Soss is the next Volcker, then it would be wonderful if his name was put forward. But if he is what you say then I imagine the political timing won't work, especially given the dithering over Elizabeth Warren that we've seen of late. The Republicans might be willing to accept a Volcker-inflation slaying clone, but only if Warren (and perhaps the new Consumer Protection bureau) were sacrificed in exchange. Would that be a good trade?

Is Bailing Out Irish Banks Worth the Blood and Violence?

World Bank President Zoellick Gift Wraps Gold $1400+

'Tis soon to be the season of giving, and the monetary gifts to gold owners are getting off to an early start.

Not to be outdone by Federal Reserve Chairman Ben Bernanke's recent 'QE2' goody bag, World Bank President Robert Zoellick has penned an editorial in the Financial Times calling for a global monetary debate on returning to a gold standard of sorts.

Zoellick's proposal is for a basket of the world's leading currencies - the dollar, euro, yen, pound, and renminbi - to be paired with gold (which he describes as "an international reference point of market expectations") in a new Bretton Woods styled monetary order.

Gold really didn't need much of a reason to finally poke its head above $1400/oz, but Zoellick's op-ed and the gold chatter that's sure to follow will almost certainly provide the nudge.

Meantime gold owners can sit back, grab a bag of popcorn, and enjoy what's about to happen to the price of your Au.

Too Big to Save: Is Ireland the 'Lehman' of Europe's Sovereign Debt Crisis?

One of the most articulate and knowledgeable authorities on the financial system and crisis is MIT Professor and former IMF Chief Economist, Simon Johnson.

In two must watch videos Professor Johnson clearly explains why another financial crisis is inevitable unless specific steps are taken to prevent one.

Video: Keynes vs. Hayek Rapoff (Round 1.5)

From the Economist's recent conference in New York. Update: this post was originally titled 'Round 2' as it was the second rapoff, but a new 'Round 2' was just released here.



Here's the original Keynes vs. Hayek, which is coming up on close to 2 million views on YouTube.

$10.2 Trillion

Per the IMF, that's the amount of money fifteen major developed-country governments will be borrowing in 2011.

That represents an increase of 7% over 2010, and 27% of the 15 countries combined annual economic output.

More thoughts and analysis of these figures at the WSJ Econ Blog here.

Will Professor Niall Ferguson's prediction of a U.S. fiscal crisis come in on the early side of his forecast?

Morbidly Cool Website: The 'Impact Catastrophe Calculator'

Following up my recent post on the Ultimate Black Swan, if you're curious about how much damage different types of asteroids would do if they struck earth check out the 'impact catastrophe calculator'.

You can customize your asteroid along the following parameters:

• Diameter - a prepopulated list gives asteroid sized options such as a school bus, the Empire State Building, or the London
• Density - i.e., ice, porous rock, iron, etc.
• Impact Angle
• Velocity
• Surface type struck (i.e, sedimentary rock, water, etc.)

A brief video showing your asteroid careening for earth plays, which is then followed up with a damage report detailing the crater size, etc.

Has Federal Reserve Secrecy Become Untenable?

The most interesting aspect of the Fed's new 'quantitative easing' announcement (aka QE2 ) was not its $600,000,000,000 price tag.

Nor Fed Chairman Ben Bernanke's op-ed in the Washington Post which stated that a key benefit of QE2 is higher stock prices.

I believe the most interesting, and perhaps significant, questions relate to the impact on the Fed's ability to maintain secrecy in wake of the unprecedented media coverage of QE2.

A Well Telegraphed Event

Regular Fed watchers of course know that an oft used Fed strategy is to communicate upcoming policy shifts through speeches and leaks to the press well in advance of the actual vote and formal policy change announcement. The Fed's thinking here is that this strategy provides time for market participants to acclimate to an upcoming policy change, thereby avoiding a sudden (and perhaps unwelcome) monetary surprise.

Anyone following the general financial press was probably aware no later than September that QE2 was going to be announced at the November Fed meeting. Media coverage of QE2, including my first writeup, began appearing as early as June.

Of Bonds, Bubbles, and the "Sean Connery of Bonds"

The ultimate Bond

James Bond aficionados interested in a guide to the world of bonds (government, investment grade, emerging markets, etc.) will enjoy this cheeky video from the FT.

In the video various categories of bond investments are compared to the main actors to don the role of 007 -- Roger Moore, Pierce Brosnan, Daniel Craig, and of course the original HMSS agent, Sean Connery.

Who was your favorite actor to play James Bond?

For All Mankind

To get the country back on track does the United States need a big, audacious "man on the moon" type goal?

Whether converting the energy infrastructure from fossil fuels to clean energy, or sending humans to Mars (and returning them), would an ambitious, forward looking project of this scale help us regain our confidence and vitality?

Looking back at the original man on the moon project, I highly recommend For All Mankind, the 1989 Academy Award nominated documentary by Director Al Reinert. It is a great film with a superb soundtrack, which features Brian Eno. A brief sample clip from the beginning of the movie is  below. And for home theatre buffs with a good subwoofer, I highly recommend cranking up the Saturn V rocket launch scene.



Absolutely amazing what the United States was able to accomplish 40+ years ago with the technology of the day.