New York Times (February 22)
Mayor Bloomberg has proposed a budget for New York City which cuts 6,000 teachers, 20 fire stations, 100 senior centers, 8% of library funding, 11% of the parks and recreation budget, and 17,000 child-care options for low-income working parents. The proposed $65.6 billion budget is “less painful than expected,” largely due to the unexpectedly rapid recovery of Wall Street. “The city looks in better shape than we expected, even a few weeks ago.”
Tags: Budget cuts, New York, Wall Street
Financial Times (July 30)
Columnist John Gapper notes that three years ago the British banking system started rumbling with worries over Northern Rock. Then two years ago, “Wall Street went into spasm.” What’s changed since the banking crisis? Not much. Rather than coordinated international measures, “the reforms are not only inconsistent but–particularly in the case of the BIS [the Bank for International Settlements, which delayed implementation of stricter liquidity rules for eight years]–have a lowest common denominator feel.” As a result, bankers can enjoy their summer holidays, but “the rest of us cannot relax so easily.”
Tags: Bank reform, Northern Rock, Wall Street
New York Times (May 2)
Lashing out at Wall Street Banks is now an American pastime, but the credit ratings agencies “bear as much responsibility for the financial crisis as the banks.” Largely forgotten is the role Moody’s, S&P and Fitch played. Investors and financial institutions would never have purchased as many mortgage-backed securities and collateralized debt obligations (CDO’s) had the raters properly warned investors that these were essentially “high-tech junk bonds,” rather than triple-A securities. Current proposals aimed at reforming the ratings agencies are not enough. The newspaper supports drastic steps to improve the ratings system.
Lashing out at Wall Street Banks is now an American pastime, but the credit ratings agencies “bear as much responsibility for the financial crisis as the banks.”
Largely forgotten is the role Moody’s, S&P and Fitch played. Investors and financial institutions would never have purchased as many mortgage-backed securities and collateralized debt obligations (CDO’s) had the raters properly warned investors that these were essentially “high-tech junk bonds,” rather than triple-A securities. Current proposals aimed at reforming the ratings agencies are not enough. The newspaper supports drastic steps to improve the ratings system.
Tags: Banks, CDOs, Fitch, MBS, Moody's, NRSROs, Ratings agencies, S&P, U.S., Wall Street
