The Derivative Project

Flawed Academic Studies

Yale Professor Ayres’ Proposed DOL Financial Sophistication Test is Brillant – Part II

Yale Professor Ayres’ Proposed DOL Financial Sophistication Test is Brillant – Part II

The Whys Behind Super Normal Profits for Wall Street in 401k Plans:   What is Yale Professor Ayres’ proposed solution to protect consumers from Wall Street shenanigans in 401k plans?  Double down!  Now that the facts and transparency are coming out about the skimming, over the last 30 years, from workers’…

Introducing the Goldman Syndrome – Review of B. U. Professor Bodie’s Book: Why Academics and Industry Blame Investors for 2008 Retirement Losses

The Derivative Project is introducing a new term, in honor of ex-Goldman Director Greg Smith, “the Goldman Syndrome.” The Goldman Syndrome:  It is a situation when Wall Street does not act in the best interests of its clients, despite being “fiduciaries”.  It is defined as a circumstance when Wall Street…

How the Greek CDS Trigger Shows Fallacy of AIG “Non-Trigger” and the Duped Taxpayer

The Wall Street Journal Editorial page crowed this morning, Greece’s Credit Non-Event, Bond default insurance is triggered. World does not end.”  “The settlement process is expected to go smoothly,” said the Wall Street Journal.  The Editorial Board goes on to say in this Opinion piece, “Credit default swaps got a…

Dodd-Frank Passed in 2010, But the Financial Blogosphere is Just Starting to Focus on a Fundamental Issue

Finally, progress!  We share with you a Blog Post from The Big Picture, Barry Riholtz’s Blog. Credit Default Swaps are Insurance Products, Not Tradeable Assets, that was linked to on the New York Times news service that aggregates and publishes links to Blogs.  Just “Google” Blog Runner- Derivatives to follow…

Casino Capitalism and Why the Average American Should Care About the Hellenic Republic “Credit Event”

American taxpayers are being forced to spend millions to monitor speculative bets by a few banks and hedge funds on”credit events”, which is the determination if a bond is in default of its covenants and if there will be payouts on credit default swaps on these bonds. Here is the…

Why is Republican Witness Testimony Conflicting with The Facts?

Once again, it appears it is all how you spin it.  A core argument of the Republican lead Testimony scheduled for this afternoon’s public hearing is the threat that Dodd Frank is too restrictive, which will create regulatory arbitrage and business will leave the U.S. IMF Queries Derivatives Reform Effectiveness…

The SEC Study on “Fiduciary” is not only conflicted, but Harmful to Retirement Investors, our Youth and our Economy’s Future

Here is the Most Critical, Bi-Partisan Issue that the SEC Failed to Address in Their Study on Brokers and Investment Advisors and the Fiduciary Standard There is a crucial, bi-partisan issue, completely lacking from the just-released SEC study on who is a fiduciary for investment advice.   We can no longer…