Word: moneyitis
(lookup in dictionary)
(lookup stats)
Dates: all
Sort By: most recent first
(reverse)
...academics and economists and even some Wall Streeters say proprietary trading and other principal investments played a much larger role in the losses that were at the heart of the financial crisis. What's more, if the firms had been barred from using their own money to buy mortgage bonds, much of the credit-and-housing bubble might not have been able to form...
...Wall Street money manager Jeremy Grantham recently wrote shareholders that he thought the Volcker rule would eliminate conflicts of interest at financial firms. Citigroup's current chief executive Vikram Pandit, too, has said he believes banks need to start curtailing their riskier activities. In November, speaking to business students at Washington University in St. Louis, Mo., Pandit said that unlike with other financial crises, proprietary trading played a much bigger role than underwriting in the recent credit crunch that nearly brought down his firm. "It makes sense to me that you don't take deposits as an institution and turn...
...Bear both did.) What's more, critics say, if you were to limit financial firms to just making loans and buying low-risk securities, you would curtail profits and run many firms out of business. With fewer financial firms, other corporations might have to pay higher fees to raise money...
...companies can't sell stock or bonds as easily as investors would like to buy them, the cost of capital will go up," says James Ellman, president of the money-management firm Seacliff Capital. "That hurts companies' ability to expand, buy equipment and create jobs. GDP grows slower." (See pictures of TIME's Wall Street covers...
...problem is that Wall Street and Washington appear to have very different definitions of what is proprietary trading. Goldman and others are defining proprietary trading as the day-to-day money these firms risk in the markets, buying and selling stocks and bonds. Volcker seems to want to limit not just this trading but also the big long-term bets banks make on real estate, mortgages and other securities...