Word: dollarization
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Dates: during 2000-2009
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...Financial firms are built on capital. They take in a dollar, borrow against it and then lend out $3, $4 or $9. Or $30. In the past few years, executives have been using thinner and thinner capital - acquisitions and questionable off-balance-sheet arrangements - to build their money pails. In good times, the more of those cheap sources of capital you use, the more profitable your bank will...
...didn't. All it was going to take was a worse-than-average recession - and it looks as though we've got one - and many banks, including a number of the biggest ones, were bound to fail. The shockingly poor lending standards - housekeepers being approved for million-dollar mortgages - have only hastened their demise. "This crisis needs to be understood as something that has developed over the past decade," says Joseph Mason, a finance professor at Louisiana State University's E.J. Ourso College of Business. "This isn't just one black swan. It's a bunch of black swans that...
...requirement on loans that are not backed by deposits. But in 2004, the Securities and Exchange Commission (SEC) removed rules that capped leverage at 15 to 1 for investment-banking firms like Goldman Sachs. That allowed the firms to vastly expand their lending activities without raising a single new dollar of capital. One big backer of the rule change was reportedly former Treasury Secretary Henry Paulson, who was then Goldman's CEO. By that time, the regulatory separation between investment banks and traditional banks had long since been removed, so traditional banks such as Citigroup and Bank of America shifted...
...chaired by University President Drew G. Faust and the heads of MIT, Genzyme Corporation, and the University of Massachusetts—wrote a letter to the state congressional delegation advocating for increases in NIH funding, writing that each grant awarded creates an average of seven jobs, and that every dollar invested in the NIH generates twice as much in economic output. They also wrote that “the next generation of scientific leaders [has been discouraged] from pursuing careers in biomedical research” as a consequence of eroding federal NIH support and delays in grant-making. Glen Comiso...
...50th anniversary, but may not make it to that milestone. On Monday, the Board of Trustees voted unanimously to close the museum and use its collection—worth an estimated $350 million—in order to generate funds to cover the University’s looming multimillion-dollar budget deficit. While the plan has been met with considerable opposition from several long-time donors to the Rose and from student protests, the University is moving forward undeterred. Brandeis’s president recently said that some of the art may be saved from liquidation, but that there...