If you work in US financial markets...

[rgraham666]

A Nobel Prize winning economist weighs in.

 

[trysail]

A Nobel Prize winning economist weighs in.

Unfortunately, "stupid" and "dishonest" (and I am not referring to Mr. Stiglitz) cannot be outlawed by regulatory fiat or the wave of a legislative wand. I can attest to those facts, having devoted a career to combating "stupid" and "dishonest-" I bear the scars to prove it. Wall Street (and Bay Street and Vancouver and the City) are, always were, and always will be vast promotional machines. These institutions and the people who inhabit them are not the least bit interested in altruism- they exist for the sole purpose of self-enrichment. As always and as ever will be, the strong prey upon the weak.

 

[neonlyte]

A Nobel Prize winning economist weighs in.

I still think the phrase 'Nobel Prize Winning Economist' is an oxymoron, but it is an interesting viewpoint he expresses. It's articles like that that make me wonder about hindsight and imagination, I'm sure he felt those trends, I'm sure he voiced them... I'm not sure he voiced them out loud other than in his imagination. I'm as guilty as the next person in that respect

The BBC Economics Editor was speaking yesterday on the radio - rather odd that his speaking about his recently published book was so hesitant and lacking confidence compared with his factual new reports - but he said, about the UK collapsed bank Northern Rock, that when a competitor in mortgage lending is growing the business faster than their rivals, they have either found a solution no other lender has discovered or their business model is wrong. Since 2003, NR was outstripping other mortgage lenders in growth. The financial regulators should have discovered why, there is no way to grow mortgage business faster than your rivals without compromising the business... and so it proved. Now the bank is underpinned by £55bn of government notes, and curiously, the regulators keep their jobs

 

[rgraham666]

What I noted especially was his note on cultural differences.

As he said, a Japanese bank director having screwed up bad quits and refuses all his perks. An American CEO only goes if the directors can him and he takes a big chunk of cash with him.

Must be nice being able to fuck up and get paid for it.

 

[trysail]

Men (and women) of science have, in general, contributed to the betterment of society and the increase and diffusion of knowledge. While there have undoubtedly been ugly incidents of individuals who, for competitive reasons, have behaved selfishly (e.g., James Watson, Frances Crick and their behavior toward Rosalind Franklin), the natural impulse of those who pursue knowledge and one of the canons of science is to share knowledge.

That sort of behavior stands in stark contrast to the academics in the field of finance who, in many instances, have contributed nothing but misinformation. The gobbledegook nonsense of alpha, beta, gamma, delta, and the rest of their Greek symbology has done nothing but give a patina of science to a horde of glib snake oil salesmen, enabling them to bamboozle the trusting but gullible patsies. The received wisdom that computer-generated three sigma events won't occur is the whole reason that the financial system in the sorry mess that it is today.
(End of rant).

 

[neonlyte]

Men of science have, in general, contributed to the betterment of society and the increase and diffusion of knowledge. While there have undoubtedly been ugly incidents of individuals who, for competitive reasons, have behaved selfishly (e.g., James Watson, Frances Crick and their behavior toward Rosalind Franklin), the natural impulse of those who pursue knowledge and one of the canons of science is to share knowledge.

That sort of behavior stands in stark contrast to the academics in the field of finance who, in many instances, have contributed nothing but misinformation. The gobbledegook nonsense of alpha, beta, gamma, delta, and the rest of their Greek symbology has done nothing but give a patina of science to a horde of glib snake oil salesman, enabling them to bamboozle the trusting but gullible patsies. The received wisdom that computer-generated three sigma events won't occur is the whole reason that the financial system in the sorry mess that it is today.
(End of rant).

Rare lass was Rosalind

 

[trysail]

...it's time to put that wineglass down, take a couple of extra vitamins and have an early night. It's going to be a busy day tomorrow.

See, in particular, pp. 13-18 for a cogent discussion of and examples of historical cost accounting versus fair market value (a/k/a as "mark-to-market") accounting.

http://www.fasb.org/cs/ContentServe...ASB/Document_C/DocumentPage&cid=1176156571228

Accounting Board Issues Proposal Requiring Banks to Book Loans' Fair Value
http://www.bloomberg.com/news/2010-...ir-value-under-accounting-board-proposal.html






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