Financial Roundup: Bank Pay Limits Today, Mortgage Help, Waterboarding Bankers?

Bank pay limits to be law today — Barack Obama will sign into law today a stimulus package that forces top executives at banks getting bailouts to forego bonuses. The last minute change by Sen. Christopher Dodd could have been even more stringent but bankers and financial experts say it will still stymie executive talents. [Source: Bloomberg.com]

Obama to announce homeowners bailout — His new plan, expected on Wednesday, would offer carrots and sticks to force more mortgage lending. Government subsidies could help reduce mortgage interest rates. Financial executives are wary of provisions that could allow bankruptcy judges to ease mortgage rates. Meanwhile, home sales increased in December. [Source: The New York Times]

Cherry-picking Citi – Citigroup’s hopes to raise cash by selling parts of the company are running into trouble. Buyers seem more interested in parts that Citi wants to keep. Texas billionaire Gerald J. Ford, for instance, is interested in the Golden State Bancorp that Citi wants. On-the-block entities such as CitiFinancial, CitiMortgage and Primerica can’t find buyers. [Source: Reuters]

Bronte Capital offers insights — John Hempton of Bronte Capital has a lengthy and useful blog posting that covers such timely topics as what “solvency” and “liquidity” really mean in today’s turbulent environment. He also helps fill in some gaps in understanding the intent of Treasury Secretary Timothy Geithner’s rescue plan. [Source: Bronte Capital]

Should the SEC adopt CIA tactics? — Georgetown Professor Donald Langevoort suggests that the SEC could do better if it adopted CIA-style information gathering such as much broader use of field contacts and data. Skeptics counter that the concept could lead to water-boarding and renditions of wayward bank executives. [Source: CFO.com]