Obama XV: Now, with 20% more rage

[Kepler]

Re: Obama XV: Now, with 20% more rage

There was almost a perfect storm of greed, regulatory indifference and stupidity that metastisized throughout the entire financial system.

Any time there is regulatory indifference there is a sudden spike in greed. It is just remotely possible these two things are linked.

Stupidity, well, that's just the wallpaper of life.

 

[Patman]

Re: Obama XV: Now, with 20% more rage

The regulators need more people with MBAs and PhDs in Mathematics than they do lawyers and other enforcement types who always clean up after the fact.

You would know more than I, but I would think that the SEC itself doesn't need Math PhDs unless the SEC wants people to spot trends in the numbers. What you need is people with better ears to the world. Just because the big boys went out and hired every person who knows Ito's Calculus doesn't mean the SEC needs it. The PhDs are the ones who model up the ideas to make money and the particulars of a trade and its advantage. Fraud is more a matter of detection of events and hacking through the trick swamp.

Fraud is a matter of being able to spot it. Maybe math guys can spot it better... I don't know one way or another. I'd say as a math guy its easier to spot things because of having a background in it... but the legalese of fraud is still the old ways.

I'll defer to you on this of course... I'm just kicking in my two cents.

 

[solovsfett]

Re: Obama XV: Now, with 20% more rage

not to beat a dead horse but I'm wondering about this article

http://www.time.com/time/nation/article/0,8599,2015629,00.html

and particularly this sentiment

"Some voters bucked at the incongruity, repeatedly telling pollsters that even programs that have clearly helped the economy, like the $787 billion stimulus, did no such thing."

what exactly has the stimulus done to help the economy? evidently that's not clear to me as the author intimates it should be

 

[Patman]

Re: Obama XV: Now, with 20% more rage

what exactly has the stimulus done to help the economy? evidently that's not clear to me as the author intimates it should be

Faith... blind faith.

The real question... "what did the stimulus do to make America more efficient?" Why does nobody ask it of Congress?

 

[geezer]

Re: Obama XV: Now, with 20% more rage

When Time Magazine publishes negative quotes about Obama, things have truly taken a serious u-turn. The in-the-streets-rejoicing over the Permanent Democratic Majority has been dying down considerably over the last 18 months or so.
It'll be an interesting election day this year.

 

[Old Pio]

Re: Obama XV: Now, with 20% more rage

When Time Magazine publishes negative quotes about Obama, things have truly taken a serious u-turn. The in-the-streets-rejoicing over the Permanent Democratic Majority has been dying down considerably over the last 18 months or so.
It'll be an interesting election day this year.

Over the years I've learned that words like "permanent" "majority" and "finished" should be used with great care when speaking of American politics.

Take Nixon: Written off after losing to JFK in '60 (ABC aired a progam called "The Political Obituary of Richard Nixon," featuring commentary from the Communist traitor Alger Hiss), humilated in '62 in California, "this is my last press conference," keeping his head down in '64 as Goldwater took Republicans to a "permanent" second class status. In '66 he campaigns for and helps to elect a bunch of GOP candidates, earning the derision of LBJ, who called him a "chronic campaigner." In '68: nominated and elected president. Oops.

 

[Kepler]

Re: Obama XV: Now, with 20% more rage

Over the years I've learned that words like "permanent" "majority" and "finished" should be used with great care when speaking of American politics.

Take Nixon: Written off after losing to JFK in '60 (ABC aired a progam called "The Political Obituary of Richard Nixon," featuring commentary from the Communist traitor Alger Hiss), humilated in '62 in California, "this is my last press conference," keeping his head down in '64 as Goldwater took Republicans to a "permanent" second class status. In '66 he campaigns for and helps to elect a bunch of GOP candidates, earning the derision of LBJ, who called him a "chronic campaigner." In '68: nominated and elected president. Oops.

I think you point's well taken for parties (the GOP was never supposed to recover from Watergate, the GOP was supposed to have a permanent majority with the Southern Strategy) but as for specific politicians, Nixon's an exceptional case. Like a cockroach, he could have survived a nuclear strike. He was the Republican Marion Barry.

 

[Kepler]

Re: Obama XV: Now, with 20% more rage

When Time Magazine publishes negative quotes about Obama, things have truly taken a serious u-turn.

Where's that monolithic left wing media when we need it? (Could it just be false equivalency from the cheerleaders over at Fox? Nah.)

 

[Red Cloud]

Re: Obama XV: Now, with 20% more rage

Take Nixon: Written off after losing to JFK in '60 (ABC aired a progam called "The Political Obituary of Richard Nixon," featuring commentary from the Communist traitor Alger Hiss), humilated in '62 in California, "this is my last press conference," keeping his head down in '64 as Goldwater took Republicans to a "permanent" second class status. In '66 he campaigns for and helps to elect a bunch of GOP candidates, earning the derision of LBJ, who called him a "chronic campaigner." In '68: nominated and elected president. Oops.

To be fair, that would probably never happen today for an individual. Since Nixon, presidential losers (in the general) stay presidential losers. McCain's age notwithstanding, could anyone ever see him running for President ever again after that show? Kerry? Dole? Dukakis? Mondale?

The only one who really had a shot to bounce back was Gore, and that's only because of the fact that he won the popular vote and lost in a controversial manner (although most of the "controversy" was fairly ridiculous).

 

[ScoobyDoo]

Re: Obama XV: Now, with 20% more rage

what exactly has the stimulus done to help the economy? evidently that's not clear to me as the author intimates it should be

Probably nothing. However, there were a number of infrastructure projects that have been getting funding and getting done that were sorely needed. Living in a state that saw the collapse of an Interstate bridge I can tell you that the infrastructure in this country has been taking a turn for the worse over the years and new infrastructure is needed going forward.

 

[Bakunin]

Re: Obama XV: Now, with 20% more rage

I can tell you that the infrastructure in this country has been taking a turn for the worse over the years and new infrastructure is needed going forward.

I'd settle for adequately maintaining the existing infrastructure.

 

[ScoobyDoo]

Re: Obama XV: Now, with 20% more rage

I'd settle for adequately maintaining the existing infrastructure.

That would be nice.

 

[Kepler]

Re: Obama XV: Now, with 20% more rage

To be fair, that would probably never happen today for an individual. Since Nixon, presidential losers (in the general) stay presidential losers. McCain's age notwithstanding, could anyone ever see him running for President ever again after that show? Kerry? Dole? Dukakis? Mondale?

The only one who really had a shot to bounce back was Gore, and that's only because of the fact that he won the popular vote and lost in a controversial manner

I think it is possible that if McCain were younger (and campaigned better) he could still have been a player. Imagine a situation where he fights the good fight, loses by 3-5 points, then fearlessly stands in the Senate well athwart Obamaconomics. The economy drops with provisions passed "over his dead body," and, lo, he looks like the serious GOP challenger in a "told ya so" election.

Kerry might have had a shot as well, but he shrank during the campaign rather than grew.

Dukakis didn't have any national platform once he lost, plus he was ripped and discredited worse than anybody since McGovern.

Mondale and Dole were time servers whose number came up -- those guys never make comebacks.

I can certainly imagine a younger candidate with a good base and a national profile losing a close election and then continuing to be a threat -- if anything, the 15-minute-attention-span television-generation helps that. God help us all, Palin could fit that category if she lost in 2012, as would Obama this last time around had he lost a squeaker.

 

[ScottM]

Re: Obama XV: Now, with 20% more rage

You would know more than I, but I would think that the SEC itself doesn't need Math PhDs unless the SEC wants people to spot trends in the numbers. What you need is people with better ears to the world. Just because the big boys went out and hired every person who knows Ito's Calculus doesn't mean the SEC needs it. The PhDs are the ones who model up the ideas to make money and the particulars of a trade and its advantage. Fraud is more a matter of detection of events and hacking through the trick swamp.

Fraud is a matter of being able to spot it. Maybe math guys can spot it better... I don't know one way or another. I'd say as a math guy its easier to spot things because of having a background in it... but the legalese of fraud is still the old ways.

I'll defer to you on this of course... I'm just kicking in my two cents.

It's not really fraud, per se that created the current mess, it was an apparent inability of the array of regulators to full grasp the extent of how interwined everything was. The Fed apparently missed a number of red flags in subprime, small banks doing more CRE lending, etc. The OTS obviously didn't realize AIG was more than a fusty old insurance company, rather that a very big black box tied to everything. Moreover, I doubt the Fed, SEC or CFTC really understood the CDS markets or the fact there were trillions of dollars in contracts with less than trillions of dollars backing them.

If regulators are to "regulate" I'd rather they actually understood the products and services their charges deal in, and act accordingly. It's easy to throw a Wells Notice at a person or company after the damage is done. It takes more work to head off that risk before it imperils everything else. Moreover, given the recent failures of DOJ to secure a conviction or even a good plea from low-hanging fruit like Bear Stearns' traders, AIG's Joe Cassano, etc., I really think "an ounce of prevention is worth a pound of cure".

 

[Kepler]

Re: Obama XV: Now, with 20% more rage

Moreover, I doubt the Fed, SEC or CFTC really understood the CDS markets

Did the traders?

 

[ScoobyDoo]

Re: Obama XV: Now, with 20% more rage

It's not really fraud, per se that created the current mess, it was an apparent inability of the array of regulators to full grasp the extent of how interwined everything was. The Fed apparently missed a number of red flags in subprime, small banks doing more CRE lending, etc. The OTS obviously didn't realize AIG was more than fusty old insurance company, rather that a very big black box tied to everything. Moreover, I doubt the Fed, SEC or CFTC really understood the CDS markets or the fact there were trillions of dollars in contracts with less than trillions of dollars backing them.

If regulators are to "regulate" I'd rather they actually understood the products and services their charges deal in, and act accordingly. It's easy to throw a Wells Notice at a person or company after the damage is done. It takes more work to head off that risk before it imperils everything else. Moreover, given the recent failures of DOJ to secure a conviction or even a good plea from low-hanging fruit like Bear Stearns' traders, AIG's Joe Cassano, etc., I really think "an ounce of prevention is worth a pound of cure".

People knew and people told people. People didn't listen. I think "The Big Short" pretty much lays that out.

 

[ScottM]

Re: Obama XV: Now, with 20% more rage

Did the traders?

Sadly, you don't need to understand what you're trading, as long as you make money. You might be surprised by the number of college and high school dropouts trading commodities, and other derivatives, on the CBOT or Merc pulling in seven, or more, figures a month.

 

[Rover]

Re: Obama XV: Now, with 20% more rage

NPR had a great piece on about a month ago. They bought a CMO filled with toxic mortgages, and then had a couple of reporters track down some of the people who had defaulted. Of the 10 people they tried, only 1 would talk to them. He was a 70 something year old guy who owned a house in Florida but decided to buy a second home (with a 20 year mortgage) nearby. When he couldn't pay it anymore, he just walked and admitted that at his age he could care less about what that does to his credit score.

Of the rest of them, one person lost their job, and in those cases I sympathize with the home owner. Not everyone underwater or in default is a scammer, and sometimes I have to remind myself of that. However...

4 of the mortages were due to some small time idiot speculator who actually bought not only these properties but had many more outside of this CMO to the tune of 3-4M dollars. In fact he was being investigated by the state. These idiots can go screw. I have no sympathy for them, nor do they deserve any help in getting out from under their debt. The main culprit in their situation is themselves ultimately.

 

[Bakunin]

Re: Obama XV: Now, with 20% more rage

4 of the mortages were due to some small time idiot speculator who actually bought not only these properties but had many more outside of this CMO to the tune of 3-4M dollars.

This reinforces the point I made earlier about speculation playing a significant role in the formation and bursting of both the dot-com and housing bubbles.

only 1 would talk to them. He was a 70 something year old guy who owned a house in Florida but decided to buy a second home (with a 20 year mortgage) nearby. When he couldn't pay it anymore, he just walked and admitted that at his age he could care less about what that does to his credit score.

Apparently, he's never heard the term "deficiency judgment".

 

[Patman]

Re: Obama XV: Now, with 20% more rage

It's not really fraud, per se that created the current mess, it was an apparent inability of the array of regulators to full grasp the extent of how interwined everything was. The Fed apparently missed a number of red flags in subprime, small banks doing more CRE lending, etc. The OTS obviously didn't realize AIG was more than a fusty old insurance company, rather that a very big black box tied to everything. Moreover, I doubt the Fed, SEC or CFTC really understood the CDS markets or the fact there were trillions of dollars in contracts with less than trillions of dollars backing them.

If regulators are to "regulate" I'd rather they actually understood the products and services their charges deal in, and act accordingly. It's easy to throw a Wells Notice at a person or company after the damage is done. It takes more work to head off that risk before it imperils everything else. Moreover, given the recent failures of DOJ to secure a conviction or even a good plea from low-hanging fruit like Bear Stearns' traders, AIG's Joe Cassano, etc., I really think "an ounce of prevention is worth a pound of cure".

I will say that I recall seeing a talk in 2008 (Andrew Lo, MIT) talking about how all the quants got wiped out big time one day in 2007 or so (not trying to speak for him) and he gave some indicators (the Wall St geeks won't exactly be forthcoming on their models) and described, roughly, how they got wiped out.

If I would say anything, then the math guys could give you an understanding if you are headed for shark territory. I don't know if the SEC is just fraud and law or if they participate at all in "health of the markets"... see the rest would really have to do with your level of comfort with the government micro-steering the markets and their right to do so seeing as you are playing with companies.

I could see where it can be useful, but I can also see where it would be dangerous. Not everything bad or stupid is illegal. I certainly agree that having some analysts who understand the industry and having mathematics/stat types who can identify such things would be a bonus.

But, I will say this. Nobody will take those jobs and take a standard mathematician/statistician money for them. They'd all have to be GS-14/15, ST, or some other supped up gov't salary table. If you have that kind of knowledge, you are working elsewhere... though I admit, that could be a fun as hell game to be involved in.