Viewpoints: Markets
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2011
Raise Interest Rates, Boost the Economy
American Banker | Jun 14 The Fed policy of keeping short-term interest rates near zero is deterring lending, hindering job-producing investment and undermining confidence.
Easy Solution to Private Companies' GAAP Issues
American Banker | Jun 9 Bankers should support the formation of a new Financial Accounting Foundation board because it will produce better reporting by our private company commercial customers.
Five Ways to Improve Risk Management
American Banker | May 31 A solid risk management plan moves products to market faster, invests staff in areas where they have the most opportunities, and puts a bank in a competitive position.
Fixation on the Next Quarter Has Bad Results
American Banker | May 18 Moving away from an excessive focus on quarterly earnings can produce real safety and soundness gains for financial institutions and strengthen the regulatory mechanism.
Careful with the Lure of Dividends
American Banker | May 3 Frustrated bankers are exploring dividend policy changes to improve stock prices. But the focus should be on risk-adjusted earnings from investments.
Navigating the Recapitalization Process
American Banker | Apr 27 The bank and its investors will want to ensure early on in the negotiations that the regulators are on board with the transaction and any controversial terms it may include.
Adjust Expectations on the Pace of M&A
American Banker | Apr 18 Investors are carefully following the industry news and, perhaps incorrectly, investing in the target company as a speculative play, as opposed to investing in the acquirer.
Ron Paul's Tilting at Gold Windmills
American Banker | Apr 13 There are few topics where more intellectual capital has been spent on an issue of lesser practical value as the prospects for either a partial or total return to the gold standard.
Coping with New Consumer Credit Risk Realities
American Banker | Apr 12 Rational judgment must complement the efficiencies of the laws of large numbers. Bankers must avoid the lure of financing consumers that believe in spending beyond their means.
Executive Compensation Out of Sync with Shareholders on M&A
American Banker | Mar 7 Why are there so few transactions materializing between healthy acquirers and "crippled" banks? The simple answer is management teams at the crippled banks don't want to lose their jobs.
Good Time to Unload Charged-Off Consumer Debt
American Banker | Mar 3 Why sell the accounts instead of managing them in-house or sending them to an agency? Selling the debt allows a financial institution to bolster its bottom line with a cash infusion.
Hedging Against Inflation, Deposit Loss
American Banker | Feb 22 Should we worry about inflation? Of course we should. But comprehensive risk analysis, product innovation and technology will help soften its otherwise devastating effects.
Don't Be Duped by Innovative Illusions
American Banker | Feb 17 In every boom, we hear about "creative" new financial products. Such products are not real innovations. They are merely new names for diminishing credit standards.
M&A Environment Likely to Reward Savvy Investors
American Banker | Feb 16 Even as bank prices have come down to around book, activity has not yet responded as much as one might think. There are several obvious reasons the wave hasn't started in earnest.
Case Is Strong for Capital Additions
American Banker | Feb 15 Higher capital levels would at least reduce the likelihood and cost of a crisis. Equally important, they are unlikely to produce material economic harm.
Rising Rates May Actually Nudge Borrowers to Action
American Banker | Feb 7 Instead of lenders' lamenting any assumed harm from rising mortgage interest rates, they should more closely consider why modest increases can be to everyone's advantage.
Viewpoint: Looking Back at One Bubble and Ahead to the Next
American Banker | Jan 4 Standing at the dawn of 2011, how can we apply what we have learned about bubbles and panics? The first lesson is not to let the engine over-rev or run too long.
2010
Viewpoint: Navigate Carefully to Preserve D&O Coverage
American Banker | Dec 20 First, insureds should examine their policy to assess whether notice of claim or notice of circumstances which might give rise to a claim should be submitted.
Viewpoint: FASB Should Ease Cash Flow Hedge Requirement
American Banker | Dec 9 In making this change, the hedge documentation could legitimately reflect the economic objective of the hedge, and the accounting would conform to this appropriately stated intent.
Viewpoint: Stop the Fed's Dual Mandate and Boost the Dollar
American Banker | Dec 8 The path to reviving the economy is not complicated: a strong dollar, resuscitating the private sector by cutting marginal taxes, and eliminating capital gains and corporate taxes.
Column: Don’t Take it for Granted that Customers Know All You Offer
American Banker | Dec 1 It's a pretty safe bet that you and your team are not nearly the known entity with the customers you'll interact with today as you'd assume.
Viewpoint: Henry Ford, FDR and a Desperate Hour in Banking
American Banker | Nov 29 A little-known thread in the story of how America navigated from the market crash to the start of FDR's administration involves an old quarrel between two former business partners.
Viewpoint: Dodd-Frank Gets Securitization Wrong; Here's How to Get It Right
American Banker | Nov 23 The requirement to have "skin in the game" maintains and arguably doubles down on all of the conflicting social goals imposed on erstwhile "prudential" regulators.
Column: In Defense of Derivatives and Structured Products
American Banker | Nov 17 Can these products be misused? Yes, but so can loans and other more traditional products. That is no reason to stop using them.
Viewpoint: The Dodd-Frank Act Didn't Kill the OTC Derivatives Market
American Banker | Nov 16 Dodd-Frank merely shifted the derivatives market from a bilateral to a more transparent cleared model. Though the changes will be dramatic, it won't change the market's importance.
Viewpoint: A 3-Point Plan to Recapitalize Minority Banks
American Banker | Nov 8 Structured real estate sales, private-equity investment and the recently enacted small-business lending program can recapitalize minority banks and position them for the future.
Viewpoint: Five Ways to Flop in Customer Retention
American Banker | Oct 28 In Marketing 101 we learned it takes more money to acquire a new customer than to retain an existing one. As you evaluate your retention strategy, try to avoid these mistakes.
Viewpoint: Dodd-Frank System Overhauls Can Be ROE Opportunity
American Banker | Oct 27 The reforms present business opportunities. The winners will make compliance requirements pay double-duty — as a catalyst for cost-cutting and for gaining insight on customers.
Viewpoint: M&A May Be Best Path Available to Profit Growth
American Banker | Oct 20 Banks have raised billions since the market crisis began. Their immediate future is thereby ensured. Nonetheless, survival alone is not enough.
Viewpoint: Secondary Market Issue, Prime Concern
American Banker | Oct 19 The various proposals differ on whether the government should have a role, if any, but most call for at least a limited guarantee for securities backed by conventional mortgages.
Viewpoint: Unresolved Questions on Volcker Rule
American Banker | Oct 8 Whether certain trends will persist, and what the real effect will be on banks and the markets remains to be seen, yet the most important law may be the law of unintended consequences.
Viewpoint: GPS Needed to Navigate a Dark, Derivatives Forest
American Banker | Sep 29 Market participants must monitor as much exposure information as they can, not only on their own counterparties but on everyone in the market.
Viewpoint: Banks Still Courting Credit Risk Two Years After Crisis
American Banker | Sep 28 It is 2010 and the subprime market is gone, but if the terms found in many bonds and syndicated loans being bought by U.S. banks are any indication, it is still 2005 in those markets.
Viewpoint: More to Risk Management than Capital Standards
American Banker | Sep 21 Proper supervision of underwriting standards and proper specification of risk-based capital requirements are keys to bank soundness.
Viewpoint: Apply Lessons from Customer Data Management to Financial Reporting
American Banker | Sep 7 The mind-set toward financial data quality has changed in recent months as financial executives are now adopting many of the best practices developed by customer data stewards.
Viewpoint: More to Deal with in the M&A Market
American Banker | Sep 3 Another bank consolidation wave is inevitable as the market thaws, and banks that approach regulatory approval the old way could find themselves stuck in the mud.
Viewpoint: Positive Tone Need on Impact of Dodd-Frank Act
American Banker | Aug 11 The key will be to shine a positive light on the new laws by using the most helpful aspects of regulatory reform as a means to make your bank look good in the eyes of your stakeholders.
Viewpoint: Look Beyond the GSEs in Housing Reform Debate
American Banker | Aug 10 We believe federal support is a critical part of sustaining a deep and liquid supply of capital for housing to meet the needs of a growing and changing population.
Viewpoint: FASB's Fouled-Up Fair-Value Proposal
American Banker | Aug 5 A recent FASB proposal, if enacted, would reduce capital on banks' balance sheets, particularly during the downward part of the cycle when they need it most to continue lending.
Viewpoint: Stress Testing Should Be Continual
American Banker | Aug 5 Stress testing should become a part of our everyday decision-making. It is a means to get a glimpse of risk under unknowable future situations that are only imagined today.
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