Archegos Capital’s Bill Hwang was sanctioned by the SEC and banned from trading in Hong Kong. Banks still lent him billions of dollars to make risky trades — and paid the price.
When ViacomCBS lost half its value at the end of March, it turned into a $33 billion firesale thanks to Archegos Capital, Total Return Swaps, and leverage.
April 7, 2021 Update: Since this post was originally published, Credit Suisse revealed their losses were worse than the $4 billion anticipated. The firm is writing down $4.7 billion due to its Archegos exposure, cutting its dividend, suspending share buybacks, and…
In early January, GameStop was trading around $18. By close on Wednesday, it had reached $364.15. An intense buzz has formed around the stock thanks to discussion on the Reddit forum WallStreetBets, further enhanced by dominant coverage in the media. At least one hedge fund that was shorting GameStop (betting the price would fall), Melvin Capital, got utterly crushed.
Some cheered the victory of Reddit and Robinhood over Wall Street. But it isn’t so simple.
This mania started when the WallStreetBets subreddit began writing about some of the most shorted retail stocks. You can bet that the price of a…
To the Human Rights Campaign,
In the final days of the Obama presidency and as we anticipate the most anti-LGBTQ administration we’ve seen in decades, I write to urge you to use your significant influence to stand up to these anti-LGBTQ forces. The Human Rights Campaign is positioned in a way that few other organizations are, and I hope you can exercise your influence over Wall Street to change the course of the time ahead.
In the first year of my very first job on Wall Street at Morgan Stanley, I wasn’t out at work. I was uncertain about how my coworkers would react, especially since no one on my team really talked about family — or even about our weekends; everything, on my team of workaholics, was focused on the task at hand. But after settling in a bit, I soon realized my hesitancy was totally unwarranted. I also learned that the firm had a strong LGBTQ network, and regretted not getting involved sooner. But the real shift happened after the changeover in leadership…
One need only look at recent headlines to see that bigotry is alive and well in the United States. Black college students are as likely to get hired as white high school drop-outs. Women are still paid less than men, even when their performance is equal or better. And the vast majority of people incarcerated for drug crimes are people of color, even though blacks and whites use drugs at roughly the same rate. But according to former Republican Senator from Texas Phil Gramm, the United States has already beaten bigotry, with one…
Originally published at Because Finance is Boring.
What’s a government agency to do when a major source of profits for two big banks is at risk? If you’re the Department of Housing and Urban Development (HUD), you just try and make the problem go away for them!
Mortgages are still big business to the nation’s biggest banks. And most banks rely on the government to help in case things go wrong, through insurance that reimburses the bank if the borrower defaults — called FHA insurance.
The government form banks must fill out in order to get this insurance used to…
If you’re one of the 43 million Americans with student debt, you’re probably all too familiar with student loan servicers — companies like Navient/Sallie Mae, Great Lakes, Nelnet, and FedLoan Servicing. Have any of these companies, who are paid by the government to service student loans, ever caused you stress? If they have, the Consumer Financial Protection Bureau (CFPB)— the agency dreamed up by Senator Elizabeth Warren — wants to hear about it.
Senator Warren blasts kickbacks for brokers and subtly shames five of her fellow Senate Democrats.
Since her arrival at the United States Senate, Elizabeth Warren has broken many unspoken rules of Congress. She’s called out members of her own party’s Administration — lambasting regulators for not bringing cases against bankers. She’s joined Senator Sherrod Brown to call out President Obama on the secrecy of the Trans-Pacific Partnership (TPP) trade agreement. And now, Senator Warren is also using her substantial megaphone to send some not-so-subtle messages to her fellow Democrats in the Senate.
Payday lenders have a horrifying— yet effective — approach to lobbying.
The payday lending industry makes its profits of off individuals who are living paycheck-to-paycheck — and they’re not afraid to admit that. Their interest rates are astronomical: the annual interest on a two-week payday loan ranges from 391 to 521%. And average annual interest rate matters because 4 out of 5 payday loans are rolled over, often trapping customers in a cycle of debt.
Wall Street firms sometimes find it difficult to advocate for financial deregulation in Washington, due to ongoing hits to their credibility. But they’ve mastered a reliable work-around: use community banks as a PR human shield. Organizations like the American Bankers Association (ABA) have used this tactic in everything from feel-good TV ads to their ongoing lobbying. This is a phenomenon I wrote about back in December:
As the fight over the “CRomnibus” showed — with Senator Elizabeth Warren issuing a nearly ten-minute tirade against Citigroup on the Senate floor — the nation’s largest banks remain toxic in Washington (at least…
Alexis is a former Wall Street worker who now advocates for a safer & fairer economy.