MoreNotesToSelf

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Posts Tagged ‘zero hedge’

Former Goldman MD on Goldman Profits

Posted by DK on July 31, 2009

I thought this was an interesting read. The arguments rests on the now well-publicized observation that bank profits are being driven by the 'free' money provided by the Fed. Nevertheless, another viewpoint never hurts (care of Zero Hedge).

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AIG Fuels Bank Profits

Posted by DK on March 30, 2009

Tyler Durden at Zero Hedge publishes a provocative post regarding bank profitability and AIG CDS payouts. In some ways, this should not be a surprise. As described in my previous Soros post, AIG was long lots of credit risk by selling protection to banks. Given how far credit has deteriorated, banks SHOULD be deeply in-the-money on those contracts. Indeed, these contracts are precisely why AIG has been bailed out multiple times by the government. So as these contracts get unwound, a significant amount of P&L should be flowing to the banks.

Nevertheless, Tyler always offers an interesting opinion, so have a look.

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