Receiving Wide Coverage ...
Goldman CFO to Retire: David Viniar, who has served as Goldman Sachs' chief financial officer since its 1999 IPO, plans to retire in January and take a "non-independent" seat on the board. The 57-year-old will be succeeded by Harvey Schwartz, nine years his junior, in what the Journal describes as Goldman's "
'If X+Y=Z, and We Cut X, Why Won't Z Fall?' The papers question QE3's power to minimize consumer mortgage costs, noting that previous rounds of stimuli lowered bond yields but not the spread between those rates and mortgages. "Banks say they are keeping rates high right now because lowering them any further would overwhelm them with customers," says the Post, though Times columnist Peter Eavis challenges the usual "backlog" explanation. Noting that Wells Fargo recently announced a big expansion of its mortgage staff, Eavis writes: "Perhaps a new equilibrium has descended on the market that favors the banks' bottom lines. The drop in rates draws in many more borrowers. The banks add more origination capacity, but not quite enough to bring the spread between bonds and loans back to its recent average." The current average 30-year fixed rate of 3.55% is inarguably cheap by historical standards, but Eavis writes that if spreads behaved as they used to, it would be 2.8%.
Wall Street Journal
The Journal's editorial page is happy that the Transaction Account Guarantee program appears unlikely to receive an extension,
Here's a disturbing trend:
U.S. regulators are having a hard time getting their counterparts in other countries to adopt new rules for derivatives by year-end. "London would like an extra six months, while Japan would like at least a year, and regulators from Hong Kong, Australia and Singapore want to
Financial Times
Speaking of international resistance to American standards: The head of the International Accounting Standards Board criticized a new approach to loan-loss provisioning the U.S. Financial Accounting Standards Board is developing. If banks had to provision upfront for all expected losses over the life of a loan, rather than just for the first year,