* Chuck Norris does not mark to market. The market marks to Chuck.

* Chuck Norris does not go bankrupt. Chuck Norris ruptures banks.

* Source of hedge fund survivorship bias?: Funds that pay Chuck Norris 2 and 20 survive; others don’t.

* Private equity: Chuck Norris does not believe in leverage. Chuck Norris believes in crowbars.

* Investment banking: No-one defers Chuck Norris’s compensation.

* Capital structure: No-one subordinates Chuck Norris. All his equity is preferred.

* If Chuck Norris devised the bank stress tests, not even the Treasury Department would survive.

Chuck Norris & Finances

William K. Black suspects that it was more than greed and incompetence that brought down the U.S. financial sector and plunged the economy in recession — it was fraud. And he would know. When it comes to financial shenanigans, William K. Black, the former senior regulator who cracked down on banks during the savings and loan crisis of the 1980s, has seen pretty much everything.

Now an Associate Professor of Economics and Law at the University of Missouri, William K. Black tells Bill Moyers on the JOURNAL that the tool at the very center of mortgage collapse, creating triple-A rated bonds out of "liars' loans" — loans issued without verifying income, assets or employment — was a fraud, and the banks knew it.
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Watch online...

William K. Black: CSI Bailout

Great article from Jim Jubak from MSN Money comments on US inflation and Chinese Yuan.:
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It's too soon to bury the U.S. dollar as the global reserve currency, but it is time to start thinking about writing its obituary.
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In the long run, however, make no mistake: The dollar's days as the world's reserve currency are numbered. And we have no one to blame for the dollar's demise but ourselves.

US debt sets stage for inflation

What's more intriguing is why the surplus countries bought into this -- well, let's call it what it was -- global Ponzi scheme. It wasn't because the financial experts in these countries were stupid. Many of them clearly saw the scam for what it was. Gao Xiqing, an adviser to then-Chinese Premier Zhu Rongji, said in 2000 "that if you look at every one of these (derivative) products, they make sense. But in aggregate, they are bull----. They are crap. They serve to cheat people."

But the surplus countries had as much incentive to believe in the short-term solution as the deficit countries did. Once you hold $500 billion in Treasurys, you aren't inclined to say, "Hey, these are not as safe as I thought." When you need higher yields to feed an underfunded state pension plan, you're not inclined to say, "You know these aren't really suitable for a pension fund."

And so, as the risks grew, more-extravagant instruments were needed to keep the money circulating around the globe. And then, one day, the bust in the U.S. housing market, what could have been a relatively small event in a universe with less leverage and less riding on unsustainable guarantees, showed that the system was built on smoke and mirrors.

And the money stopped circulating. And the global economy ground slower and slower in a devastating credit crunch.

How to fix the global economy

As a side note, the Fed has also, given the size of its bid (which will likely be increased), enabled the Chinese to sell their Treasury holdings if they want. Then the question is, what will the Chinese buy with those "liberated" dollars? My guess: the hard assets that China needs.

To sum up: Quantitative easing, unfortunately, is an outcome that I always knew would occur, though it still shocked me when Fed Chairman Ben Bernanke finally pulled the trigger. The masthead of my Web site reads, "In a social democracy with a fiat currency, all roads lead to inflation." Many people have been confused because they thought that it meant every negative outcome would lead to inflation directly, but that isn't the case. It's the response to the problems that leads to the inflation (and currency debasement).

We are attempting to print our way to prosperity (see "The Fed embraces inflation," my June 2, 2008, column). That can't be done, any more than we could speculate our way to prosperity during the stock bubble or borrow our way to prosperity in the real-estate/credit bubble. Got gold?

Got Gold?

March 9 (Bloomberg) -- The value of global financial assets including stocks, bonds and currencies probably fell by more than $50 trillion in 2008, equivalent to a year of world gross domestic product, according to an Asian Development Bank report.

Asia excluding Japan probably lost about $9.6 trillion, while the Latin American region saw the value of financial assets drop by about $2.1 trillion, said Claudio Loser, a former International Monetary Fund director and the author of the report that was commissioned by the ADB. The report didn’t give a breakdown of asset declines in other regions.

Global Financial Assets Lost $50 Trillion Last Year, ADB Says

Short video Jim Jubak detailing CEO pay in multiple countries compared to the US and impacts to the US.

CEO: Quit whining over pay cap

The world's once-largest insurer expects $60 billion fourth-quarter loss.

NEW YORK (Reuters) -- American International Group Inc. is in talks with the U.S. government for further help, as the troubled insurer expects to post a $60 billion fourth-quarter loss, a source familiar with the matter said Monday.

The talks with the government include the possibility of additional funds for the insurer and trading debt for equity, another source said.

AIG in talks with U.S. for more funds:

Jan. 21 (Bloomberg) -- China’s economy overtook Germany’s to become the third-largest in 2007. Japan may be next to be leapfrogged, if China can sort out its relationship with the U.S.
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At least $650 billion of China’s $1.9 trillion of reserves are in U.S. Treasuries. A move to sell those assets would boost interest rates and further damage China’s export industries. Mutually assured economic destruction limits options and leverage in Washington and Beijing. President Barack Obama should act fast to hold this arrangement together.
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The U.S. and China should do the global economy a favor and formalize the G-2 process.
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The U.S. economy is worth $14 trillion, while China’s is worth $3.3 trillion. The G-7 was yesterday. The G-2 is today and tomorrow. It’s time for folks in Washington and Beijing to stop pointing fingers and get to work.

A $17 Trillion Alliance Can Save World

He has done a terrible job. I am glad he is gone.

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Jan. 20 (Bloomberg) -- Christopher Cox stepped down as U.S. Securities and Exchange Commission chairman, leaving behind a demoralized agency that failed to spot Bernard Madoff’s alleged fraud and had its role diminished by the collapse of Bear Stearns Cos. and Lehman Brothers Holdings Inc.

His resignation took effect at noon today in Washington, agency spokesman John Nester said. During Cox’s 3 1/2-year tenure, the SEC has been criticized by lawmakers, investors and its own inspector general as lacking aggressiveness and being deferential to Wall Street banks. President Barack Obama, a Democrat, picked Mary Schapiro, the head of the U.S. brokerage industry’s self-regulator, to succeed the Republican Cox.

Under Cox, who was offered the SEC job by Vice President Dick Cheney, public fights among Democratic and Republican commissioners stopped and enforcement penalties declined.

Cox Quits at SEC, Leaving Schapiro to Restore Clout