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Lawrence's Etruscans
I re-read Women in Love a couple of years ago and thought, I’m out of patience with Lawrence. Then… Then, visiting my in-law in Montpellie...
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You can skip this boring part ... LI has not been able to keep up with Chabert in her multi-entry assault on Derrida. As in a proper duel, t... -
The most dangerous man the world has ever known was not Attila the Hun or Mao Zedong. He was not Adolf Hitler. In fact, the most dangerous m...
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Being the sort of guy who plunges, headfirst, into the latest fashion, LI pondered two options, this week. We could start an exploratory com...
4 comments:
two things strike me as very odd at this point - where is the legal action against moody's, s&p, and Fitch? Nothing civil or criminal has been brought that I'm aware of.
second thing, the SEC - absolutely silent over the past 5 years at least. I can appreciate it may be difficult to find active regulators since you pull from an industry they hope to return to, but is there no way to have this run correctly? There must be some story behind Cox's appointment for it to be that ineffectual.
p - the SEC has been out of business for years. In the nineties, when the head of the SEC wanted to investigate accounting firm practices - the same practices that led to Enron - Congress threatened to defund them. The charge was led by the rebarbative Lieberman.
But the bigger issue really is the culture of chasing the highest yield. What did people think? How could anybody look around them, in 2005, and justify the prices houses were selling for? I mean, generally, people weren´t stupid about the stagnation of their incomes - so they were basically rusing into a circle jerk of borrowing money to buy houses to sell them to people who´d borrowed even more money on the way to infinite wealth. Why ask questions? This is a cultural collapse as much as an economic one: a culture that can no longer understand the long term is going to run into it sooner or later. Put off Osama bin Laden and you get a nice little training camp that, over time, racks up any number of successes, as in Mumbai. Forget about the very basis of a consumer economy - a consumer´s real economic power - and substitute loans with interest rate that ratchet higher sometime there in the middle distance, and you get massive foreclosure. America has always been notorious for forgetting its history - a short term memory loss country. Combine that with forgetting the future, and you have basically a mental patient candidate.
Here´s a nice example of how investors justified high, irrational yields, from today´s NYT story about Palm Beachers who´ve been soaked by Madoff, the contemporary Insull - whose 50 billion dollar ripoff pales in comparison to some retiree from GM being able to pay for his healthcare, at least for our braindead political elite:
“He just didn’t make mistakes,” said Richard Spring, 73, from Boca Raton. “He was just a sound, smart, reasonable guy.”
Mr. Spring recounted meeting Mr. Madoff in the early 1970s when they shared a helicopter each day commuting from Long Island to Wall Street.
He said he vividly recalled one commute when Mr. Madoff “bawled out” one of his traders for sloppy work, not protecting against a downturn.
Impressed, he later invested with Mr. Madoff, over time putting more than $11 million into the firm, virtually every cent of his savings, he said.
“I’m taking care of my sick mother-in-law. My wife has cancer. I just can’t deal with it,” Mr. Spring said, only barely choking back tears. “I’m cooked.”
He invests 11 million dollars with no clue as to how the guy makes money, but gladdened cause he yells at his underlings???? What can I say? I wrote a post at the beginning of this year, predicting that this would be the year of cooling the mark out. I should repost that.
oops, that wasn´t Miruna, that was me.
Great review, and you share my skepticism about the insane gaudy casino operators. But...the cultural malaise is pretty deep and pretty broadly shared.
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