The Squid and the (London) Whale
May 22, 2012
As soon as we learned that the trader largely responsible for JP Morgan’s $2 billion-and-counting loss had been nicknamed “the London Whale,” it was pretty much inevitable that we’d find a squid on the other side of the trade. And whaddya know. It turns out there was a squid involved! Better yet, it wasn’t just any squid, but a great vampire squid—the kind that wraps itself around the face of humanity and jams its blood funnel into... well, you know the rest. Over to you, Wall Street Journal: A group of about a dozen banks, including Goldman Sachs Group Inc.
My Day in Mitt Romney’s Book Club
May 21, 2012
Like any Woody Allen fan, I’ve been waiting my entire adult life to re-enact the Marshall McLuhan scene from “Annie Hall.” Today, Mitt Romney and Jonathan Chait finally gave me the excuse I needed. Here’s the backstory: On Friday, Romney told a crowd in New Hampshire that he was reading my recent book on Obama and the economy. The book’s take-away, according to Romney, is that Obama deliberately slowed the recovery to focus on health care reform. “In this book, they point out that they said the American people will forget how long the recovery took,” Romney said.
Why the White House Is Sweating JP Morgan
May 17, 2012
The Wall Street Journal has an intriguing story today about the anxiety in the White House over $2 billion-and-counting loss that JP Morgan announced last week. At first blush, the reason for the angst isn't entirely clear. After all, the loss would seem to strengthen the case for financial reform, which, as it happens, the president signed into law two years ago, and which Mitt Romney opposes. To the extent that JP Morgan revives the debate over financial reform, it would seem to benefit Barack Obama. But, alas, the issue is more complicated than that.
Why the Stimulus Was Smaller Than It Looked
April 30, 2012
The Washington Post had a nice piece out Monday on the way state spending cuts have crimped the economy these past few years, and on the difficulties Obama encountered trying to mitigate that problem. As the piece reports: Obama had tried to address the problem in the 2009 stimulus bill by including more than $150 billion in aid to state and local governments to fill budget gaps. But as his second year began, economic advisers told the president that state and local governments were still poised to lay off huge numbers of workers, posing one of the biggest threats to the burgeoning economic r
The Case for Queasiness on the Economy
April 27, 2012
There are two fair conclusions to draw from the recent run of middling economic data, culminating with Friday’s disappointing GDP number. First, contra Mitt Romney, this is not an administration with a failed economic record, at least not as we sit here today. In almost every way—job growth, housing, GDP—Obama has presided over a vast improvement in the economic situation he inherited.
George HW Bush's Romney Endorsement, Seriously
March 30, 2012
Don't get me wrong, I see the appeal of nailing down George HW Bush's endorsement. It signals to the GOP establishment and the media that the nomination is effectively over, probably helps Romney raise some money, and maybe gets a few more fence-sitting Republican elites on board. Still, I'm not entirely sure that outweighs the negatives in Romney's case. After all, Romney is doing fine in the GHW Bush wing of the Republican Party.
How Obama Could Have Avoided His Mandate Quagmire
March 29, 2012
Reid Cherlin, a former Obama White House spokesman whose portfolio included health care, had an interesting post up at GQ.com yesterday about why the Affordable Care Act is so damn hard to sell. The gist: It would have been easy for Verrilli—or any of us—to explain single-payer health care. "Look," we could have said, "the government is paying for everyone to have coverage." End of story. But single-payer is not what our brilliant, world-leading political system gave us.
Jim Kim and the Problem of Excess Humility
March 28, 2012
After reading this Rolling Stone piece about Dartmouth (via Felix Salmon), I now see why the school's president, Jim Yong Kim, who Obama just tapped to head the World Bank, made such a good impression on Tim Geithner: They have very similar views on cultural humility--by which I mean how much you can impose your own values on a foreign culture.
Matt Bai's Excellent Piece...Shows 2011 Was Pointless
March 28, 2012
Matt Bai’s long-awaited, 10,000-word opus on the rise and fall of last summer’s deficit grand-bargain is finally out and very much worth a read. Bai adds a lot of new detail affirming what we thought we knew—which is that Obama was ready to do a deal and Boehner wasn’t—but which got much hazier in recent weeks amid Team Boehner’s furious spin. Still, for my money, Bai puts too little emphasis on the much deeper problem looming over the whole exercise, which is that it didn’t actually matter whether Boehner was willing to strike a deal.
Your Must-Read of the Day, Wall St. Edition
March 26, 2012
Bloomberg has an absolutely terrific piece of reporting out today about how the big banks have mobilized to water down the Volcker Rule—the reform measure designed to prevent federally-backed banks from placing bets for their own bottom line. Here’s the gist: To make their case in Washington, banks and trade associations have been pressing a coordinated campaign to get regulators from five federal agencies to scale back the draft of the proprietary-trading rule issued in October, according to public and internal documents and interviews.