tag:blogger.com,1999:blog-8918506024298353276.post7547779477198852374..comments2023-09-20T07:41:02.432-04:00Comments on Polecolaw: A Tale of Two Cities: New York and Detroit (Wall Street Competitiveness)Palermo's Bloghttp://www.blogger.com/profile/09467127128993089930noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-8918506024298353276.post-73568995707511133382007-10-14T12:25:00.000-04:002007-10-14T12:25:00.000-04:00DD: Thank for your comment. The reason I ended u...DD: Thank for your comment. The reason I ended up linking to that article is that it was the only way I could find to get to Dan Gross, the author of the NYT article in question. I tried emailing him at Newsweek, looking him up on their website, through the NYT, and via a general web search, but came up empty. The emails I sent came back undeliverable, and there was no place to make any comment. If you are interested, you can see Mr. Gross's interview on CNBC here: http://www.cnbc.com/id/15840232?video=556681596&play=1 . Note his discussion of fees that does not appear in his article. His article can be found here: http://www.nytimes.com/2007/10/14/magazine/14wallstreet-t.html?pagewanted=1&_r=1&ref=magazine . I am genuinly curious about this but have been frustrated in my attempts to contact him directly.Palermo's Bloghttps://www.blogger.com/profile/09467127128993089930noreply@blogger.comtag:blogger.com,1999:blog-8918506024298353276.post-39138550003880151182007-10-13T23:35:00.000-04:002007-10-13T23:35:00.000-04:00I'm not sure what your point is here - you want US...I'm not sure what your point is here - you want US banks to lower their fees...? Well, as more business leaves the country, the laws of economics dictates that they will need lower their own fees or face a death spiral if they start to try to compensate for the loss of business. That's the nature of the competitive environment. However, these fees are assessed by the investment banks mostly on equity offerings. I'm not quite clear how, lets say a 5% cut on the returns from a public offering effects the underlying company and economy for that matter. However, for debt offerings it does indeed increase the effective interest rate - however, I believe debt offerings have a substantially reduced fee rate in comparison to IPOs. I'm not sure why you harped on the Newsweek blog regarding the aforementioned fee issue as their topic for discussion was how the fed's interest rate cut is not the remedy for the mortgage turmoil - it's tantamount to giving a cancer patient some aspirin and sending him on his way.<BR/><BR/>Reducing the fed rate has a major side effect that's not receiving enough attention in my mind. Our greenback is taking a major hit on the foreign exchanges.<BR/>http://www.newyorkfed.org/aboutthefed/fedpoint/fed38.html We all know that Bernanke is a money printer. I think what you may have missed yourself is a more important question - what are the effects of the continued devaluation in US currency is going to have on our economy? Positive short term effects are known - it's a boon to US manufacturers - especially capital goods (Boeing). However, I believe these interest rate measures have severe long term consequences which we will have to eventually face. I mean, for god sake, it's embarrassing that the Canadian Dollar has reached parity with the US. It's actually now even more expensive. The Euro is ridiculously expensive now. European banks who've invested in US debt have also taken a hit as a result (ex. Northern Rock - US firms bought them out since the underlying assets are based in their own currency). Perhaps the major, long term effects of the devluation wont surface during this Presidency - And frankly, I think Mr. Bernanke is doing Pres. Bush a huge favor, but it definitely wont bode well for his own legacy. I hate to be the harbinger, but I think that the US' currency woes may spiral into a greater economic crisis similar to that of Asia's in the late 90s.<BR/><BR/>Anyway, just my 1.95 Canadian cents.<BR/><BR/>Regards,<BR/>DDK<BR/><BR/>PS - On a side note, with regards to the McKenzie report, as a consultant at a mid size consulting firm myself (albeit, not top tier) I've never found their work (MacKenzie) to be impressive nor the least bit useful. We've been hired to clean up reports and studies that they've done on several occasions. Yet major companies still hire them for their name recognition.ddhttps://www.blogger.com/profile/13396596393079037326noreply@blogger.com