Risk Based Capital

The acquisition of CRBC by FMER provides a stark illustration of the fundamental conflict between the Fed’s “dual mandate” and its legal responsibility to supervise the nation’s banks. 

Just As I Warned Of JPM's Exposure, Those Other Warnings Will Come To Pass As Well. I pull stuff out of my analytical archives and low and behold, who do I find?

And the real lesson, dear friends, is that the good old USA is a subprime nation

Not many websites, analysts or authors have both the balls/temerity & the analytical honesty to take Goldman on. Well, I say.... Let's dance! This isn't a collection of soundbites from the MSM. This is truly meaty, hard hitting analysis for the big boys and girls. If you're easily offended or need the 6 second preview I suggest you move on.

Now everybody's bank bashing, of course the reason to bash the banks is 4 years old, despite Bove-like analysis to the contrary. I will discuss this on CNBC for a FULL HOUR tomorrow from 12 pm to 1pm.

Grandma said, "There is never just one roach". What damning characteristics does MF Global, Goldman Sachs, and JP Morgan have in common? Yes, I mean besides common CEOs and an auditor that gives the green flag months before historically record setting bankruptcies due to inadequate controls...

I add some real BoomBustBlog style meat to an already interesting Bloomberg piece that poses the question, "Can Goldman or JPM start a worldwide bank run?" Well, I think you all know my stance on this.

Yeah, that's right! I said it. They CAN'T TRADE!!! Haven't I proven my point yet?

Here I discuss the chances of Goldman Sachs succumbing to an MF Global/Lehman/Bear Stearns style bank run. Impossible, you say? Don't bet the farm on that one, son!

Lauren Lyster, the enticing Russian TV/Capital Accounts host gave me the rare opportunity yesterday to sit down & run my mouth for 15 minutes straight. This format's most conducive to true conveyance of knowledge and information, at least in my not very humble opinion. I'm just not the 8 second soundbite type. Plus, I'm sure I pissed many long-only guys off...

I call you to attention. I have found a bank that literally has more derivatives risk than Citibank, Goldman, Morgan and JP Morgan - COMBINED! If BAC & JPM are stuffing derivative risks behind your bank accounts, are you naive enough to believe that foreign banks are doing the same?

Booyah! There you go. The markets & the media have concentrated on Morgan Stanely because Goldman has successfully hid much of its risk from those who didn't subscribe to BoomBustBlog. Watch the fireworks as the truth is exposed, then goes VIRAL!!!

How will GS put a real hedge, a counterparty risk mitigating prophylactic if you will, over that big green stalk that is representative of Total Credit Exposure to Risk Based Capital? Short answer, Goldman may very well be to big for a counterparty condom. You pretty, brand name Goldman counterparties out there (and yes, there are a lot of y'all - GS really gets around), expect to get burned at the culmination of that French banking party I've been talking about for the last few quarters.

We comb through today's key Q&A by Ron Paul, Brad Sherman, Spencer Bacchus and Scott Garrett to find all the relevant instances in which Ben Bernanke either a) pleads the fifth, b) provides reasons to doubt his sanity, c) confuses what monetary policy is all about (not to mention cause and effect), d) forces Zero Hedge to send an Econ 101 textbook to the Marriner Eccles building c/o Ben Shalom Bernanke, or, e) lies outright.

Back in September, Capmark Financial Group, Inc., (100% owner of Capmark Bank) spiked Capmark Bank's capital with a $600 million dollar transfer of $490 some million in cash and $100 some million in "servicing advances." Just to keep everyone up to speed, in June of this year, Capmark Bank reported total assets of $11.12 billion and outstanding deposits of $8.39 billion. No small fish, Capmark. Just a few days after the hot cash injection, on October 2 to be precise, Capmark Financial consented to the entry of "Cease and Desist" orders effective immediately and imposing an 8% Tier 1 leverage ratio requirement on Capmark Bank along with a "Total Risk Based Capital" ratio of 10%. The firm was also required to issue capital plans to the FDIC and Utah authorities within 45 days.