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Elizabeth Warren, chairman of the TARP Congressional Oversight Panel, testifies at a hearing on Capitol Hill, on July 22, 2009 in Washington, DC.
Were you wondering why some big banks are reporting big profits, even as markets are driving down their share prices? Blame it on...accounting: "'This is the most vilified accounting rule I've ever seen. It's amazing how universally despised it is,'" said Robert Willens, author of the Willens Report, which analyzes corporate accounting and tax matters." (Reuters)
Somebody loves Massachusetts Senate candidate Elizabeth Warren: "She is provocative and assertive in her critique of corporate power and the well-paid lobbyists who protect it in Washington, and eloquent in her defense of an eroding middle class." (NYT)
What it was like in SoCal when aerospace was booming: "...dozens of airfields dotted the landscape; test-rocket firings flashed and echoed in the foothills; and the local economy became yoked to the boom-and-bust cycles of defense spending. In the process, aerospace helped drive the extraordinary metamorphosis of California from a rural, agrarian state to the sixth-largest economy in the world." (Zócalo)
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File: A Bank of America branch is seen in Times Square October 19, 2010 in New York City.
Financial regulation of Wall Street matters in Washington. The U.S. Treasury thinks so and has begun to blog about why. Yes, blog. In its most recent post, the Treasury debunks the idea that bank reform is somehow bad for small banks:
Myth #1: Wall Street Reform Hurts Small Banks
This claim is particularly dubious given strong support for enactment of the Dodd-Frank Act by the Independent Community Bankers of America. Wall Street Reform helps level the playing field between large banks and small ones, helping to eliminate distortions that previously favored the biggest banks that held the most risk.
The operative concept here is risk. It isn't small banks that pose systemic risk to the banking system — it's the too-big-to-fail banks that ignored prudent risk models in the lead-up to the financial crisis. Robert G. Wilmers — a banking executive who runs M&T Bank, one of the few large banks that more or less sailed throught the financial crisis — provides a very succinct take on the problem at Bloomberg:
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Randy Bernard, IndyCar's CEO, was hoping for a spectacular end to the racing season. IndyCar got the tragic death of Dan Wheldon instead.
At the New York Times' Wheels blog, Jerry Garrett offers a quietly disturbing account of the events leading up to Indy 500 winner Dan Wheldon's death in a horrific multi-car crash at Las Vegas Motor Speedway yesterday. The short version is that the racers were worried, even fearful, about the track and the setup for the race, which had been designed to conclude the IndyCar season with a bang.
It's only a matter of time before the spotlight falls square on the decisionmaking of IndyCar CEO Randy Bernard. This is a guy who was a former bull riding promoter, brought over to IndyCar to inject some life into a moribund open-wheel racing series, where the marquee event is the Indianapolis 500 and everything else is an afterthought.
Clearly, an injection of life wasn't what the racing world got yesterday, as too many cars went too fast on a small track, leading to the carnage that killed Wheldon and ended both the IndyCar season and superstar racer Danica Patrick's open-wheel career on a very somber note. (Patrick is moving to NASCAR full-time next season.)
A Solyndra solar rooftoop installation.
Here's some good news for the solar industry, in the aftermath of the Solyndra scandal. The LA Times reports that California is basically SolarLand, USA:
California's solar jobs tally was more than four times greater than runner-up Colorado, which had 6,186 solar jobs.
The Golden State ranked first in the nation for generating electricity from both photovoltaic solar panels and concentrated solar power systems that use mirrors to create steam to run turbines, the study said.
The report goes on to anticipate 24 percent industry growth over the next year, taking the total number of California jobs up to about 50,000 (there are currently about 25,000).
That sounds great, but as I've pointed out before, will it be enough? No one has really ever questioned that solar is growing as an industry. The problem is one of scale: Can solar ever attract enough investment to rival traditional sources of power generation, particularly super-cheap coal?
Today's Tweet of the Day comes from David Wessel (@davidmwessel), the Wall Street Journal's economics editor. It speaks for itself. But it doesn't necessarily tell the whole story. The U.S. government may be financing 36% of its spending. But how much is that financing costing?
The yield on the 10-year treasury has been falling for quite some time, recently dipping below 2 percent before recovering, but still hovering well below 3 percent. In other words, the government can borrow as much as it wants for practically nothing.
When you have to finance 36 cents on every dollar you spend, this is a position you want to be in. Worldwide, people still think the USA is safe place to stash their cash.