The Atlantic Business Channel: Anal

Anal_yst

The Anal_yst started blogging in the mid 2000's around the same time he began his career on Wall Street as an Investment Banker, and has been writing for 1-2 Knockout since early 2008. He has written for SeekingAlpha and Dealbreaker, and been featured on FT Alphaville, Money Central, Abnormal Returns and other popular business blogs and websites. Follow him on Twitter.

Recently by Anal_yst

Feb 5 2010, 11:15AM

Should Individuals Be Regulated Like Wall St. Banks?

by Anal_yst

Since the beginning of the crisis, the debate on financial regulation has focused on placing limits on financial services firms' behavior, based on the idea that the government has to protect Main Street from Wall Street. Recent history suggests that bankers lack the incentive or will to avoid unsustainable, economically disastrous, and downright predatory behavior.

But just as a securities trader can focus on short-term profits and ignore the incremental systemic risk introduced with each transaction, the average American often ignores the incremental risk he incurs with his own financial behavior -- each credit card opened, or each mortgage refinance. If we acknowledge that bankers lack the will-power to judge how much is too much*, then we must acknowledge the same failing in the common man, who lacks the banker's financial background.

The average American deserves protection not only from Wall Street, but also from himself. What if, hypothetically, we imposed regulations on individuals similar to those imposed on banks? Here are three ideas for saving average Americans from our own worst impulses.

Comments (7)

Jan 14 2010, 2:23PM

The Myth of 2009's Great Consumer Deleveraging

by Anal_yst

Pundits and analysts have recently celebrated yet another reduction in U.S. consumer debt as a sign that we're in full-on recovery mode and the worst is behind us. Last week the Federal Reserve released data on consumer credit through November 2009. I checked out the data myself and found that all that consumer deleveraging we're hearing about is a big fat myth.

Comments (32)

Dec 22 2009, 2:41PM

New Financial Regulation Is Only Half The Battle

by Anal_yst

Several other observers have written at length about the sort of financial regulatory reform the U.S. needs to adopt in order to achieve sustainable health. In general, recommendations tend to include big-picture concepts. While I think all of these goals are admirable both individually and as a whole, the devil is, as always, in the details.

Comments (4)

Dec 10 2009, 12:34PM

How NOT to Address the Windfall Profits Debate

by Anal_yst

While the New York Times may be home to many a nonsensical finance argument, Steven M. Davidoff (Dealbook's "Deal Professor") should know better. Davidoff's bio -- cum laude at UPenn, Masters in Finance, former M&A lawyer, and current professor at U-Conn -- doesn't lead you to expect an argument of populist non sequitur. But for some reason, that's exactly what we find in a Goldman post from The Professor a few days ago. And to think, he began with such promise:

The real issues are twofold. First, how much are Goldman's profits and bonus payments related to the benefits provided by the federal government during the financial crisis?

Nov 20 2009, 12:34PM

The Media is Wrong about Goldman Sachs, AIG

by Anal_yst

This week brings us a joint effort from the New York Times and Reuters, reminding us all that Goldman Sachs is the devil incarnate and without the generous AIG bailout, they'd be just as hosed as their more earthly competitors:

Goldman Sachs Group Inc could have suffered dramatic losses if the federal government had not intervened to prop up American International Group Inc , according to a government report.
It was revealed in March that Goldman received $12.9 billion in payments and collateral from AIG. (emphasis mine)

Well, nothing to really hammer home your agenda like rank speculation and utterly horrific summation. The TARP report (or SIGTARP) is 32 pages long, and traces the AIG bailout/credit default swap settlement from start to finish. The NYT article, at 350 words, focuses on a very small, cherry-picked section of the report's contents, and it ignores what I believe is the far more important point: Government (Treasury, Fed) officials failed to embrace their duty to the American people with hasty, and not particularly well-thought-out decision-making. That's right folks, I am defending not just Goldman, but the other banks that were paid "effectively par" (which is the report's language) on their credit default swaps with AIG as well.

Comments (10)

Oct 5 2009, 9:59AM

In Defense of Goldman's $1 Billion Payoff From CIT

by Anal_yst

Henry Blodget has a post up at Clusterstock/Business Insider expressing outrage that if CIT goes the bankruptcy route, the "evil vampire squids" at Goldman Sachs will reap a $1 billion payment before taxpayers. To clarify, this is a $1 billion "make-whole" payment (similar to a lump-sum payment, where the borrower pays off all future interest after a bond is called early) and would cover a 20-year deal in which CIT had agreed to pay Goldman about $85 million annually for ten years, according to Bloomberg.

So sayeth Blodget:

The U.S. taxpayer, meanwhile, who should have been entitled to the usual last-in-first-out protection any private investor would have demanded (as Goldman did), will lose $2.3 billion.

Comments (8)

Aug 24 2009, 4:31PM

Anonymous Blogging: Take it or Leave it

by Anal_yst

When the generally useless CNBC anchor Dennis Kneale starts pointing fingers at anonymous/pseudonymous business and finance bloggers, referring to us as "digital dickweeds," its time I take a few minutes to address this issue.

Being a sometimes contributor to the controversial finance blog, Zerohedge, and a moderately well-known pseudonymous blogger, I think I have a unique perspective on this issue.

Comments (11)

Jun 26 2009, 8:30AM

US Auto Myth #2: Blame the SUVs

by Anal_yst

On Wednesday, I explained that, contrary to what you often hear, Americans do not demonstrate any particular affinity for small cars, even with gas prices down. Today, we'll address another popular misconception. The second myth I've considered is this: That the shift towards big SUVs is to blame for our dependence on foreign oil, high gas prices, etc.

Fact: The shift towards larger vehicles in general hasn't exactly helped, but it hasn't hurt, per se, either.

Comments (34)

Jun 24 2009, 2:54PM

Americans Don't Want Smaller Cars

by Anal_yst

One dominant myth of the US auto industry is this: American consumers want small (fuel-efficient) cars. In reality: Not so much. This runs counter to the claims (honest or otherwise) of various elected officials, and their auto industry buddies. To this day, I've yet to see any clear data that suggests Americans are demanding small, fuel-efficient cars, at least not over any meaningful period of time. But here is some data that shows the exact opposite:

Comments (16)