Archive - Sep 9, 2009

There was a time when the US would not guarantee the existence of every bank in perpetuity. When weak organizations, with or without untenable balance sheets would have to adapt to survive or simply disappear. It was known as capitalism. And it was about to change completely. However before it did, in those fateful nights before Lehman was not given the taxpayer capital "get out of bankruptcy free" card that Hank Paulson and Ben Bernanke subsequently handed out with such abandon to all other financial firms, Dick Fuld attempted to warn Chairman Ben and Secretary Hank about what would happen if Goldman got its wish of destroying its number one competitor in fixed income capital markets.

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"So there you have it: slow painful grind before the storm or a quick reversal. Given that I expect a very sizeable move the other way, I think it is much more likely that with the use of propaganda, revised data, and 10th derivative arguments on the business cycle, the eternal utopists or evil carry-traders will try to hold this status quo and push the market a little further into risk appetite territory before all the retail accounts can get properly wiped out." - Nic Lanoir, ICAP

• Dear Chairman Ben: The Chinese send their congratulations (WSJ)
• The Fed monitoring systemic risk is like asking a thief to police himself (WSJ)
• Contrary to all claims by Bloomberg of "recession easing", FDIC will likely add six-month extension for debt-guarantee program (Bloomberg) - can't have the government stop backstopping these healthy banks now can we
• NYSE selling stake in Amex options unit to Citadel and Goldman Sachs among others (AP) - just to make Christine Varney's upcoming case just that little easier
• Lloyd Blankfein between a rock, an SLP gold mine program, record Fixed Income daily profits, and 300 million pitchforks come bonus season (Bloomberg)

• Asian stocks fall on share sales; Alibaba slumps as Chairman pares stake.
• China looking at investing part of its $300B sovereign-wealth fund in US realty.
• China plans first offering of yuan sovereign debt outside mainland China, in Hong Kong.
• China's steel output rises 2% as state spending spurs demand.
• Euro rises toward 9-month high versus Dollar on speculation of recovery.
• Japan to hike fees it pays to aluminum producers by 53% - highest in 14 yrs.
• OPEC Committee to recommend keeping quotas unchanged: Kuwait Minister.