Like many of you, I’ve spent a lot of time trying to understand the financial crisis. But I was never able to ascertain how much of it was caused by rising rates of defaults, how much was caused by the complicated credit default swap market, and how much the securitization of mortgages may have helped lead to more defaults.
But after reading David Brooks, I’ve learned that it’s all a lot simpler than I thought:
Bankers, for example, used to have a code that made them a bit stodgy and which held them up for ridicule in movies like “Mary Poppins.” But the banker’s code has eroded, and the result was not liberation but self-destruction.
There’s all kinds of problems with this. First, it’s not clear what “used to” means here since it certainly doesn’t apply to the 1920s. Second, a persuasive case can be made that the end of “banker’s code” was caused not by a desire for “liberation” but by the fact that banks that had been privately held became public companies, which meant the bankers were now playing with other people’s money, not their own.
Brooks’s claim is that everything was better when people just shut up and did as they were told. Not surprisingly, his prime example of someone who’s done well by shutting up and doing as he’s told is a millionaire, former Cubs second-baseman Ryne Sandberg.
This is an argument that we often see from Villagers, whether it’s Tim Russert’s reverence for his father’s unthinking ways or Tom Brokaw’s Greatest Generation shtick or Howard Kurtz’s hagiography about Brian Williams and his regular guy ways. More often than not, of course, the rule-followers raise millionaire children or are themselves millionaires.
I’ve often wondered why pundits feel such a need to tell us that things would be better if we all just stopped asking questions. They must know that the public hears it all the time already, with or without their new columns on the subject.
I think the reason is this: our pundit is class is populated by wholly amoral people, most of them multi-millionaires, who got where they are, not by hard work or talent or accomplishment, but by following a certain set of rules that no thinking, decent person could accept.
Mike
Shorter Brooks: the reason so many bankers jumped lemming-like into the subprime waters together was that they were too independent-minded.
DougJ
That’s a good point too.
Andre
You know, I’ve long been a fan of William Blake, and many of his witticisms have stood the test of time. One, however, has not:
If only.
Church Lady
I’m afraid I will come off sounding as out of touch as Brick Oven Bill, but as I grow older, I think there is something to be said for rules and the consequences to be paid for breaking them.
My son attends a high school that has mandatory random drug testing, with a two strike rule. You would think that would be enough to keep the kids on the stright and narrow, if not only the ones that have already failed one test this year (a 90 day followup follows any failed test). Not so much – out of a senior class of around 225, ten kids have failed their second test (every single one for pot) and been expelled. I have no idea why, but can only imagine that the fear of some parental action just wasn’t there.
Admittedly, I spent most of my high school years high, but we didn’t have random drug testing then. If we had, I can guarantee that I would not have been smoking, or doing anything else for that matter, because the fear of what my parents would have done to punish me, had they found out, would have been so great.
I think this attitude has also helped with the proliferation of teen pregnancies and the spread of STDs as well. In my teenage years, if you got pregnant, or got an STD, you were labled a whore. Now, it almost seems to be some kind of badge of honor among their peers and many parents just don’t seem to care. I guess that at the ripe old age of fifty, I’m just a dinosaur.
Bootlegger
@Church Lady: Yes, we’re crotchety old folk now and the morals of the young ‘uns are going to hell-in-a-handbasket. Except they’re not. Teens’ sex rates leveled off some time ago and continue to inch down along with teenage pregnancy and divorce.
I study things like deviance and social control, and frankly punishment and deterrence are overrated. Sure, they are necessary as last resorts, but they don’t work the way people think they should (or the death penalty would stop all violence). Drug testing is a waste of scarce educational resources. Moral behavior is something that is learned, which means it can be taught, and this goes for education on risky behaviors like drug use and casual sex.
If society is becoming more "immoral", as conservatives like to claim, it is not evident in our sexual behavior but in how we treat our fellow humans. Wanton indifference to the lives of others as collateral damage, a complete failure to address food security for 1/3 of the planet, and the mantra "greed is good" are, I would argue, for more dangerous to our society than sex and drugs.
dmbeaster
The crisis is multi-layered, which is why it became so bad.
Mortgages at one time were pretty dull and somewhat expensive loans since they are labor intensive to write and retail (many small transactions). 40 years ago (or so) someone thought up the idea of mortgage backed securities, which lowered interest rates for mortgages. The key to making that work was rigorous underwriting standards so that large pools of mortgages can be expected to perform in a fairly uniform fashion and in conformity with historical models of default rates. The purchaser of a mortgage backed security can expect the pool to be reliable for this reason.
Then recently the industry stated writing all sorts of unregulated exotic securities pyramided on the mortgage backed securities. These basically served as devices for vastly leveraging the same pool of mortgages. A 20% correction on real estate values therefore has a catastrophic effect.
Over time, the big money to be made was in creating the mortgage backed securities and their derivatives. Fannie and Freddie started making their money more from that rather than packaging safe reliable pools. This created pressure to create more mortgage product, since everyone was making money from origination. This led to an erosion of underwriting standards since the risk was now being passed on, and there was so much short term money to be made in origination. This portion of the bubble was akin to the junk bond bubble of the 80s — betting on riskier forms of credit based on historical risk analysis, when the current situation was sui generis, and therefore the old models did not apply.
The other huge factor was that so much cheap money was chasing a finite amount of real estate, which drove up home prices and fueled the lending frenzy, thereby further skewing the risk. This is why this is not really a subprime crisis, since most of the defaults are now with regular mortgages made because banks and borrowers bet based on escalating values (as well as home equity lines of credit).
So pressure to write any loans, people deluded by skyrocketing real estate values as to the actual risk, and fancy derivative securities pyramiding on top of that vastly magnified the risk, which all coalesced to form this perfect storm.
burnspbesq
They all started out to be Carl Bernstein, but discovered that Bob Woodward lived a lot better.
Nothing wrong with selling out. At least, I don’t think so, but my view on the subject is arguably tainted; I left a government job I loved and was good at for the private sector when it became apparent that I couldn’t support my family the way I wanted to on a government salary.
A lot wrong with selling out and claiming you haven’t, which is what all the Villagers do.
Swervus
There were plenty of people who shut up and did what they were told before this financial crisis and got the shitty end of the stick despite all their good intentions and practices.
The main fallacy at work here is that the people who get the money and the success do in fact "work" for it while everyone else just stomps on their dicks while purposefully ignoring the advice from all the richies who are indeed SO MUCH SMARTER than all of us poor plebes.
pattonbt
Maybe times will get so tough that the public will finally start paying attention to the worthless junk pundits blather on about or the fact that they really have very little understanding of the topics they cover and they may actually be detrimental to the process of making things better by continuing to spout disproven (i.e. ‘tax cuts save baby Jeebus!!!!!’) and counter productive rhetoric.
I can wish, cant I?
Church Lady
@Bootlegger-
Scarce educational resources aren’t being wasted in this case. It’s a private Catholic high school and the cost of the testing is included in the tuition. I can’t imagine that parents don’t discourage drug use, so I have a hard time understanding why the kids do it anyway, while knowing that they are not only going to be tested the first time, but that after failing that first test, a mandatory retest 90 days later will occur. Knowing that they will be expelled, during their senior year no less, still doesn’t seem to discourage them from continuing to smoke pot. The only conclusion I can draw is that they don’t fear what their parents might do to punish them as a result of their expulsion.
Teen pregancy rates might be going down nationwide, but not where I live. In 2008, the unwed birth rate here was 85 out of every 100 births, most of them to teenage mothers already living in poverty. As a result, Memphis, TN has the highest infant mortality rate in the United States. Until a generational cycle of teenage mothers can be broken, I would imagine we will continue to hold this dubious distinction.
JGabriel
David Brooks:
There was actually another name for that code: government regulation. Funny how R’s always try to mythologize the results of public oversight as private virtue – by "funny", of course I mean "self-serving hypocrisy".
.
Conservatively Liberal
I don’t see Ryne’s name around as much as I used to. I lived about a block away from him in junior high and we both attended the same junior high & high schools (Havermale/Salk/North Central in Spokane, Washington). He was a jock and I was a head so though we knew each other we didn’t really associate much. His girlfriend in high school, Cindy, wasn’t the best looker around but she was a cheerleader and it kept him happy. Really low-key kind of guy, quiet but loves his baseball.
He came from a poor neighborhood, as did I, but he never really associated with the people in the hood and didn’t really have any ‘roots’ in it. I always had this impression that he was above that, so to say.
MediaGlutton
There ought to be a pundit reality show, where the pundit whose analysis proves the most correct over time wins the competition. Of course, most pundits wouldn’t go on this show because it’s obviously much easier to make $200,000 a year working as an analyst for CNN or FOX with no real oversight of what you say on a day-to-day basis, as long as you entertain people and keep the network execs happy. Yay, free markets!
A Different Matt
remember that article from Ben Stein the other day? In it he wrote a line that money’s worth fighting for. And that was my moment when I thought "rich people really do live by different values."
So yeah, I agree completely, our ruling class became our ruling class by creating a rigged game only narcissists could subject others to.
Remember in the Sopranos when they were playing the game of life, and Tony and Carmela were making rules that paid them out at random but beneficial moments? And Bobby threw a fit that there have to be some rules lest anarchy reign? Then Tony lost the straight-up fight because he couldn’t control for his environment? What a great show that was.
AnneLaurie
Being an amoral fvcksac who doesn’t give a shite about anything beyond one’s own pleasures, preferably within a timeframe of approximately one Friedman Unit, is precisely the time-honored, historical "tradition" BoBo Brooks is slobbering over.
He’s a human lamprey, and weakening the greater social networks and every living thing within it can only rebound to the benefit of him and his fellow lampreys.
Lavocat
i.e., money changes everything.
Always reminds me of the apocryphal conversation between F. Scott Fitzgerald and Hemingway.
Fitzgerald: There’s something different about the wealthy.
Hemingway: Yeah, they’re fucking rich is what, you idiot!
Crusty Dem
Brooks wants to put this on bankers not acting like they did in "Mary Poppins"? I always thought the most famous banker in moviedom was Mr. Potter from "It’s a Wonderful Life", one of the greatest douchenozzles in movie history. He cheated, he stole, he showed contempt for everyone, including his own customers. I’d say he’s a perfect model for the bankers of today.
This whole mess is just the same old story, remove the regulations and greed takes over. Those who push the envelope of avarice develop new and exciting "revenue streams", many of which are just some form of pyramid scheme if not just plain theft. The underlyings watch the scumbags succeed and learn from them, and everything is great, unless (or until) one day there is a reckoning. The difference today is that no one seems willing to say that the liars, cheats and thieves (with the exception of the most obvious thiefs) are actually liars, cheats and thieves; but stealing through creative accounting is still stealing.
Brooks is right about one thing, this behavior is learned, just not at Harvard, it’s learned on Wall Street, and at bank headquarters. It’s definitely not caused by "independent thinking", but by systemic greed. But as a conservative, Brooks is unwilling to blame that system, so he finds another whipping boy in academia.
JenJen
Let me guess… the "code" was BOSCO.
The Silent Fiddle of Nero
Make it more like Survivor with a Weakest Link angle, where the pundit who bullshits the most gets knocked off for making crap arguments and I’ll watch that every week. ;)
cosanostradamus
.
‘ I think the reason is this: our pundit is class is populated by wholly amoral people, most of them multi-millionaires, who got where they are, not by hard work or talent or accomplishment, but by following a certain set of rules that no thinking, decent person could accept. ‘
Since success in their tiny, miserable, well-upholstered world is contingent upon licking the asses above and shitting on the faces below in their insectoid hierarchy, I don’t know how anyone could expect any other kind of behavior from our corporate "journalists" and self-styled pundits when they’re actually on the job.
As for us humans, blogging may have just gotten a little tougher.
.
myiq2xu
I used to do retail security, and part of our theory was deterrance by making sure people knew they were being watched.
Some people won’t steal – they will even turn in money they find on the street. Others will attempt to steal no matter how hard you try to stop them.
Those two groups make-up maybe 40% of the people. The other 60% are the ones you have to try to deter.
When they don’t fear adverse consequences they will do things they know they shouldn’t, whether it’s illegal, immoral or just unwise.
RSA
I think there’s another reason, aside from the rule-following, that leads pundits to say things that a decent person would recoil from with moral distaste: Pundits in general don’t know what they’re talking about.
Look at the range of topics Brooks writes about: sociology, psychology, economics, politics, and so forth. All in his light style–because, of course, you can’t write in depth if you don’t have the knowledge to do so. Most pundits seem to be expected to do this, but the world has become such a complicated place that general observations about the nature of life just aren’t useful or interesting any more.
Of course, there are exceptions to the rule. Krugman is the most obvious one. He knows economics inside and out, which makes his writing about topics related to economics insightful. George Will is an exception with respect to baseball, a topic he should stick to. Occasionally I’ll come across a religious pundit (i.e., someone who writes knowledgeably about one or more religions) and be impressed at how well they apply their knowledge to some real-world topic, even if I disagree with the assumptions or the result. But in general? You’ve got people who have convinced themselves that they can crank out the verbiage on any topic, simply because they can write smooth prose.
Oh, Bill Kristol is an exception to this rule, too. He has a Ph.D. in government, which would seem to give him expertise, but he’s also a delusional, lying moron, which is an offsetting factor.
Montysano
When our small business pays its mortgage every month, we write two checks: one is a mortgage payment, and the other is a credit default swap. The owner of the company asked the head of the bank’s commercial division: "What’s this swap thing for?"
The banker said "I don’t know". To think that something this complex could exist outside of regulation is……. well, apparently it was the basis of Greenspan’s world view, which still gobsmacks me.
Like many other areas of our world, banking may have reached the tipping point where additional complexity is not helpful. I tend to agree with JH Kunstler that we’ve reached a complexity plateau, and in many areas we may even go backwards towards increased simplicity.
J.A.F. Rusty Shackleford
@Conservatively Liberal:
Yeah, all of Ryno’s Cubbie teammates thought so much of him that they had no problem sleeping with his wife, which is the reason why Sandberg "retired" the first time.
If Sandberg wasn’t able to play baseball he would have made a great sheet of wallpaper.
Btw, am I the only one who thinks Sandberg looks like Matt Taibbi’s retarded older brother?
Libby Spencer
The Village is run mainly by people who inherited money. They have no empathy because they never had to work to provide for their basic needs and they measure their worth based on the acquisition of material goods not by good works.
There is no moral code. They live by the credo that greed is good and honesty is for suckers. Why shouldn’t they when there are no consequences in their world for dishonesty or being wrong? In fact it’s rewarded.
TR
My thoughts exactly. How in the hell can Republicans reconcile their claim that the New Deal was a crippling blow to the capabilities of the free market with the fact that the New Deal regulatory state oversaw the greatest peacetime expansion of the American economy in the post-WWII era?
I mean, besides getting the frontal lobotomy that seems to be a prerequisite for writing for the Weakly Standard?
El Cid
It’s always a bad idea to imagine that the pundits and their employers in the major news media are dedicated to serving the public rather than to serving the classes which give them their nice lifestyle.
Ace Armstrong
Some observations.
1. Unregulated capitalism will naturally evolve to monopoly and then
oligarchy.
2. The foxes were guarding the chicken coop.
3. In parenthesis behind every pundits name when they write an
article should be their annual income.
J Royce
Church Lady: "Admittedly, I spent most of my high school years high, but we didn’t have random drug testing then. If we had…
Okay, shut up. That hypocritically critical whine you feel in your gorge is the beginning of something horrible happening to your soul, Church Lady. It is a disease called "Conservatism" in which all your own faults are projected onto others and magnified.
Our nation has been looted and our society is dying, and you take the time to be "bothered" about kids you know nothing about smoking pot. Uh huh.
Napoleon
@Montysano:
Are you sure its a credit default swap? An interest rate swap sounds more likely.
Conservatively Liberal
Hey
myiq2xuGoatBoy! Somehow those words of yours don’t surprise me one bit, less so than if you had said you flipped burgers at McDonalds. You were a Deputy Dawg…lol! My wife has one of your Deputy Dawg clones where she works; skinhead, racist as all fuck and a Republican to boot.You sure your name isn’t Al?
Bwahahaha! Deputy F’ing Dawg. GoatBoy, so far you haven’t exceeded expectations one bit. Priceless!
@J.A.F. RS:
I wonder if he married his high school sweetie (Cindy). If so then I wouldn’t be surprised one bit as she had a bit of a rep in high school (developed while dating Ryne). I know her last name but I am leaving it out of this in case it isn’t her. Ryne always seemed like he was a bit slow upstairs and he had a bad habit of hanging out with people who he really didn’t fit in with. He was always the poor guy trying to get away from his roots and those who he aspired to be with had never been poor, so I can’t help but think that while Ryne was ‘looking up’ at them, they were ‘looking down’ at him.
He was a bit of an odd duck in that he never seemed to fit in where he was and didn’t fit in where he wanted to be.
Montysano
@Napoleon:
The banker called it a CDS, but again…… he didn’t really understand what it was, or what it was for, so who knows? At the time (12-18 months ago), our 30 year old company was solid as a rock, so the risk of a default was nil.
Today……. not so much.
John S.
Shorter myiq1/2xu:
Big brother is watching, so you children had best behave!
I’ve worked retail security, too. Visible deterrents are good at catching petty/casual thiefs. Hidden deterrents are better at catching major/professional thiefs. It’s good to have both, as long as you’re not too busy nabbing the guy stealing a t-shirt to notice the lady smuggling out 20 lbs. of steak under her baby (I worked in Costco in college).
Napoleon
@Montysano:
Weird, I didn’t think they had borrowers doing that. Well the first lending officer I talk to today I am going to ask if they do that with borrowers. I know we do interest rate swaps all the time so that the loan is at a floating rate but by paying for a swap the borrower in effect locks in a rate and the swap partner takes the risk of the float.
CT
That clip yesterday of the ABC panel lecturing Krugman about economics showed the pundit class in all their glory. A normal person wouldn’t presume to bloviate about a topic they know nothing about, never mind lecture a Nobel laureate about it.
On the topic of people failing drug tests that they know are coming-that’s addiction for you. When the desire to pick up the bottle/joint/whatever hits, all thought of the consequences just melts away.
David
"Mr Banks, if I may remind you, was suspended from his banking job because he upset the owners by showing the door to a man who had a too-clever scheme to make millions.
When Mr Banks is summoned back a few months into his suspension by the elderly gnomes who own the bank, he’s expecting to get the chop. Instead, he’s embraced as a hero because the rejected client took his scheme to competitors and, to the joy of the gnomes, the scheme ruined them.
Mr Von Hussler, to give the rogue his name, may now be seen as a prophetic representative of the people in what used to be laughingly called high finance who’ve brought so much misery today with their wretched derivatives, sub-primes and credit default swaps."
. . .
http://news.bbc.co.uk/2/hi/uk_news/magazine/7847742.stm
lovethebomb
Brooks is one of those android clowns who is like a quote generating program. Just plug in a subject and a sequence of phrases will emerge which combine to support a conservative world view. He is a hack. If you’ve seen him on the TV machine, he does not come across as very bright.
During the campaign he was scolding the women on the View for the Dems position on ending the Iraq occupation. The signature RNC talking point at that time was that people who were in favor of withdrawal werent "serious and responsible." The ladies looked on like he was a loon.
You can tell what he is trying to do. He wants to herd his readers into that soft comfy womb of conservative rightness where the world makes sense and the wisest course of action is obedience and submission to an unquestioned authority. Big Daddy makes it all right. That worked with Reagan – whose world weary wise fatherly act was combined with a jolly optimism and cheerful condescension. Bush not so much.
If you watched Brian Williams on Letterman last nite, you saw a Villager who refused, despite several prompts, to say one critical word about the Bush administrations. They are Establishmentarians or, to use one of the longest words in the English language, antidisestablishmentarians. They serve as public scolds – chiding those who dare to question the authority of the status quo. Russert was particularly good at this role, grilling Dems yet giving Cheney his best platform for propoganda dissemination.
Bootlegger
@myiq2xu:
Not even close. Most people obey the rules because they agree with them. Period. And this comes from learning. The remaining small minority can be deterred if they are certain of being caught AND they fear the consequences.
liberal
@Church Lady:
Speaking generally, just because something is paid for doesn’t mean scarce resources aren’t being wasted.
AlanDownunder
Me too. We should make a school rule about exhibiting incipient merchant banking tendencies and expel anyone who breaks it twice; or else their venal amorality could corrupt our children. God forbid that our kids should end up trading their souls for mammon by passing off dud derivatives as gilt-edged securities. If they’re really unlucky, they could even do a few months in low security for it.
On second thoughts, it probably is those stoned out losers who corrupted Wall Street. Lock’em up and throw away the key!
Dervin
When I went to a business summer camp many moons ago, we had a Banker talk to us. He said the banker’s life was simple. 3-6-3. Pay interest at 3%, Loan money at 6% and be on the golf course by 3pm.
But anyway, what the pundits forget is they tell us how great innovation is, the only problem is innovation requires rule breaking.
DougJ
I agree. But the pundits present their arguments about this so poorly, it’s a joke. And it’s naive to think that bankers will follow any rules other than the ones the government makes them follow.
And the rules of our society today just aren’t fair. We’re the wealthiest country in the world, but a high proportion of working American don’t get a living wage. If Brooks really wants to understand why Americans have become so cynical, he needs to get a look at that fact.
Bootlegger
What happened to all the PMI? My first two mortgages I had to make a payment called PMI, which I was told was insurance in case I defaulted on the loan. Anyone under 80% LTV had to pay it and it was suppose to cover the risk such loans typically create. I paid about 7% of my first mortgage toward PMI, the mortgage on my second home collected it all up front, $12k. So if they were collecting all this money to make these loans less risky, WTF happened!
DougJ
@A differerent matt
It was Monopoly and they were just doing the Free Parking thing were you collect all the money paid in fines, stick it in the center of the board, and people collect it when they land on free parking. It wasn’t random. It’s a time-honored tradition. A lot of people play that way.
J.A.F. Rusty Shackleford
@Conservatively Liberal:
Sandberg’s first wife was named Cindy. She was a real skeezer.
As much as it pains me to say it, being a lifelong White Sox fan, Sandberg was a good ballplayer. But he wasn’t great, at least not Hall of Fame great. Sandberg, like a lot of players, got a huge Cubbie Boost. There is no reason Sandberg should be in the HoF while Lou Whitaker (and Alan Trammell) sit watching their vote totals get lower and lower every year. Roberto Alomar could do everything Sandberg could do, but 3x better.
Sandberg had all the charisma of a sheet of drywall.
DaveB
Sounds like "the good old days" phenomenom. My dad was born in 1922 and lived through the good old days. As he used to say, the good old days weren’t particularly good. Maybe if you were a white protestant male they were.
gex
@J Royce: Notice also how her rebuttal to the teen pregnancy rates declining cites one of those good old conservative red states as the exception. Turns out, the national decline in teen pregnancy rates is being driven by those amoral liberal blue states. You know, where sex ed isn’t the God approved "abstinence only" curriculum.
Conservatively Liberal
Yeah, then that was probably her he married. She was a real skank and I never could see what Ryne saw in her. Damn short too, maybe that’s why…lol!
Exactly. Perfect description. He just exists.
Comrade Darkness
Detroit Calls Emissions Proposals Too Strict
Translation: We don’t want to ever sell mass produced cars ever again.
If you take on the People as a major shareholder, then, guess what? you have to do what they say. And they say that you should retool for the real world. Or don’t take the money. Your choice.
And, by the way, big three, you keep hitting yourself in the head with that big stick, that’s gotta hurt.
Karmakin
@Church Lady: It’s actually pretty simple. They’re acting in a sort of reflexive protest against actions (the anti-drug policy) that they believe is immoral in and of itself. I’m not going to say if it’s right or wrong (I think it’s a very tough issue. (FWIW I’ve never done any drug and I haven’t drank alcohol in about 10 years. Don’t smoke, don’t even drink coffee.) but the problem is that we’re stuck discussing this from an authoritarian mindset rather than an actual logical and rational discussion on what is best for society and what is best for the individual, and how to balance the two.
jibeaux
\
Now we’re O/T but it just reminds me of a David Sedaris anecdote…he had been a paid companion/friend to a girl with MS while in college, and they used to go to the grocery store, him pushing her in her wheelchair, and would just load up the chair with steaks as plain as day. They evidently successfully relied on either people’s unwillingness to stare at the disabled, or to report them to store security…
Comrade Darkness
"I tend to agree with JH Kunstler that we’ve reached a complexity plateau, and in many areas we may even go backwards towards increased simplicity."
The repeated conservative mantra calling for a small, efficient regulatory agency would require that financial instruments be extremely simple because after all the crap we’ve been through recently we can not let instruments exist outside the framework. So calls for a lean regulatory agency are, in reality, the equivalent of calling for a massive simplification in finance. Something I’d love to point out to them in person. Either it’s simplified or the regulatory agency has to grow substantially, it must always be the most complex and far reaching agent in the system.
Comrade grumpy realist
*Ahem*….getting back to the financial stuff vs. Brooks:
Brooks….is a nitwit. Moaning about the demise of some Golden Age of Banking–well, first of all, it never existed except in the movies. Second, Brooks should do some hard studying up on the history of commodification and derivatives before opening his mouth. Oh, and learn some mathematics while he’s at it. Learning about the fluctuations that occur when you’re leveraged 33-1 would be a Good Start.
Bluntly, what happened is that banks found a way of creating baskets of dodgy debts that they could sell off to other people as non-dodgy sources of income, stamped with the Financial Good Housekeeping seal of AAA, carefully provided by Moody’s et al. Said financial commodities were then bundled together even more, had derivatives built on the back of them, then sold to other purchasers. It was a world-wide game of Pass the Hot Potato and finally the music stopped. Oops.
We seem to have to learn every few years that leveraging stuff at 30-1 or more presents Problems. Everyone is chastened, we all swear to be virtuous….and then a few years later some eager Bright Young Financial Expert discovers the money to be made, and the circle starts all over again.
Xanthippas
For a less accusatory but more informative take on what happened, try Roger Altman in Foreign Affairs. Granted, there’s no mention of Disney movies, but it’s informative nonetheless.
TheHatOnMyCat
The press and media typically rank down there with car salesmen in polls about trust. The whole issue is totally dog-bites-man.
Also ….
is one of those Darrellesque generalizations screaming for data and facts. I’d say that on the face of it, it probably is a huge oversimplification. Also, the medium that the pundits operate in is managed by technicians, producers and news directors who have a mechanical view of their business and its methods. I’m not sure that I’d want that layer replaced by people who think they are on some "moral" mission. If that happened, we’d basically have Jesus TV, which is already on your cable lineup. Try watching morality-driven programming for a while and see if you can keep your lunch down.
Matt
DougJ, you’ve been an excellent addition to this blog.
PanAmerican
Cindy Sandberg & corn cob dress.
Markos site has the whole sordid tale:
Not mentioned is Mark Grace in the clubhouse during a game.
Has George Will addressed "Baseball Annies" in a column? That might be worth a read. Otherwise his scribblings and those of the rest of the Village aren’t worth a damn.
Sam Wilkinson
As a Ryne Sandberg fan, I am offended that Brooks would drag him into this mess.
John S.
This lady simply relied on a baby in swaddling to cover up several packages of steak that was underneath it in the stroller.
les
@Church Lady:
"In 2008, the unwed birth rate here was 85 out of every 100 births, "
Well, maybe you could worry less if you chose actual facts instead of inflammatory types. Per the Memphis Commercial Appeal, what actually went on is 83% of unwed mothers are teens; the actual rate of such births is under 40%, and overall stats show the age of unwed mothers is increasing. Of course, teen pregnancy is highest in the south where the church community protects its children from damaging information about sex, STD and contraception. Fancy that. Maybe you could throw them all out of school–that’ll do it, yeah. Also.
Glidwrith
@Church Lady: with regards to the kids being positive a second time – don’t make the assumption that the drug test is actually valid. They aren’t nearly as reliable as the companies would like you to think and the incidence of false positives can be quite high. There have been several lawsuits concerning this.
Jon H
I’m surprised he didn’t say the problem started when bankers stopped eating at the Applebee’s salad bar.
Church Lady
@J. Royce – when it comes to raising my children, I will plead guilty to "conservatism" any day. My goals have been simple: have children that make good grades in school, obey the rules and stay out of trouble, care for others and give back to their communities in the form of volunteer work, and prepare to support themselves in their adulthood. So far, it seems to be working and I’ve managed to get through twenty one years of parenthood with very few bumps in the road. I guess the "conservatism" of making sure they always knew that there were consequences for breaking the rules and that those conseqences would be something that they would not like might have helped pave the way. Somehow, having certain expectations of our children doesn’t seem "liberal" or "conservative" to me, it just seems right.
@gex – While Tennessee might be a red state, I live in Shelby County, which is solidly blue. Somehow, the blueness of Memphis and Shelby County hasn’t seemed to lower the very high unwed birth rate, nor has it seemed to help lower our infant mortality rate, which is the highest in the nation.
Jon H
@Church Lady: ". Somehow, the blueness of Memphis and Shelby County hasn’t seemed to lower the very high unwed birth rate, nor has it seemed to help lower our infant mortality rate, which is the highest in the nation."
You need lots of religion to get a high unwed birth rate and a high infant mortality rate.
Jon H
@jibeaux: "Now we’re O/T but it just reminds me of a David Sedaris anecdote"
Sounds like one of Sedaris’ "true enough" anecdotes.
DougJ
@Matt
Thank you.
DougJ
This layer certainly acts as though it were on some moral mission. That’s why the fact they are amoral is relevant here, in my view.
TheHatOnMyCat
I think you might want to think it through a little more. If they are amoral, why would they be acting like they are on a moral mission? This sounds like some kind of Vast Conspiracy.
I think you are doing way too much projecting.
I think they are just damned fools, and you are trying to read stuff into the damned foolishness that is not there. They aren’t on a moral mission, they are acting out roles that pay them a lot of money and trying to make money for their employers. Why do we constantly have to be attaching ‘moral’ relevance to every bullshit thing that happens? That’s a mugg’s game, heretofore played by faux moralists, but now apparently playable by anyone with a keyboard.
Ain’t buyin it. Let people decide for themselves where the moral currency is in a thing. The moran moralists will see morality in everything. Let them, who cares? The people who know how to process information will realize that morality is in the eye of the beholder, and let the bullshit fall by the wayside. That’s where we want to be, in the group of people who know how to process information.
You sound like a guy looking at a McDonald’s menu board and announcing that you can’t help being overweight, just look at all the fattening food. Eat wisely, stay healthy. It ain’t that hard to do.
DougJ
The answer to this one is obvious, my friend. You disappoint me.
Many if not most who acts like they’re on a moral mission are some kind of sociopath. You know that as well as I.
Church Lady
@Jon H – No, I think poverty might have a little more to do with it.
@les – I wasn’t trying to be inflammatory. That figure was a recollection from a fairly recent report in the Commercial Appeal. I’ve tried to pull it up, but their sucky search engine isn’t cooperating. The most recent vital statistics I could find were issued by the Memphis and Shelby County Health Department for 2002-2005. Unwed birth rates for 2002 on were 53.7%, 53.7%, 54.2% and 55.6%, so they are climbing, not falling. Birth rates for women under 17 for those years were 14.8%, 15.2%, 14.2% and 15.3%. I wonder how those statistics might change if you included 17 and 18 year olds in the statistics – I would guess that the "teen" birth rate would be much higher.
TheHatOnMyCat
Yes, but we don’t agree on what the pundits are doing.
I say that they are acting out a particular role, which is primarily infotainment and business-driven, and that you are trying to lay a "moral" characterization down on that.
I disagree, I think the moral characterization is in your imagination. I think that the media put up a tableau and let the people project their own stuff onto it. That’s their game, and you are buying the hoax just as surely as the Dobsonites are buying it, just from a different mindset.
The media don’t care WHY you watch. They just want your eyeballs. Avert your eyes, they are just fucking with you. You don’t have to eat Big Macs and you don’t have to watch cable news or tv pundits. Relatively few people do, and even fewer are really paying that much attention.
DougJ
I think that is true of some of them. But I think Brooks and Cokie and some of the others have a big dollop of Jimmy Swaggart in them.
dlw32
Church Lady says:
The reason it doesn’t seem liberal or conservative is because it isn’t.
Liberal parents like myself (a 15- and a 10-year old) have all the same goals that you do. I really, really, really HATE that our society has made Liberal such a bizarre caricature. How could anyone believe Liberal parents want their children to grow up to be miscreants??
Re: consequences, on the whole I’d much rather see consequences extended to the boardrooms than the classrooms. The folks in the boardrooms are screwing up the lives of many, many more people than those kids smoking pot or getting pregnant.
When conservatives start demanding we "claw-back" the bonuses and exit packages CEOs have enjoyed over the last several years then we’ll talk about pot.
Church Lady
@dlw32 – I absolutely agree. I’d love to see shareholders demand a claw back of bonuses that have been paid on phantom/short term profits and would also love to see directors on boards that approved outrageous golden parachutes for departing executives all replaced by those companies’ shareholders.
I still think everything boils down to instilling a sense of individual responsibility. It’s hard to demand institutional and societal responsibility when so many individuals seem to shirk responsibility themselves. Contempt for the rules as an individual seems to be the staring point of so many of the problems we now seem to face as a collective.
ThymeZone
Well, two things. One, you are talking more about personality than content. And two, nobody listens to those people.
Except a few bloggers, and other people in tv. It’s all self-referential, and irrelevant. They want you to think it’s about them, so you’ll watch.
People watch stuff that confirms what they already think, not to discover new worldviews. A skilled producer can put on a show that holds eyeballs across a range of views. As far as they are concerned, that’s their job … and it is.
That doesn’t mean you have to play along with them.
DougJ
Again, I don’t share your optimism. I think they’re pretty influential, especially Brooks. Granted, I’m an academic, so I have to spend a lot of time with the NPR crowd, but those fuckers love Brooks (less than they used to, but they’re still fans). They love Tom Friedman even more.
I’m not pretending these people are typical of the public at large but there really are otherwise intelligent people who take Brooks and Friedman seriously.
TheHatOnMyCat
I think the influence is inside baseball stuff. Outside the beltway and the pundasphere, I think they are irrelevant. Even invisible.
It’s the pundits who want you to think that other pundits are important. If they aren’t, then …. nobody listens to the pundits and they have no audience. What pundit is going to say that nobody listens to Brooks? Who do the pundits talk to every day? Other pundits. It’s a totally self-referential world they live in. Not unlike the, ahem, blogosphere.
I am still looking for the first datum on the general influence of punditry and mediocracy upon the general population. All I can find is that ubiquitous universal disdain for pundits and media.
I think the disdain is pretty much all there is out here.
Shey
Church Lady
America’s war on drugs, copyright law, war on gay rights, and the penal system are worthy of contempt. The idea that rules should be followed outright breaks down when the rules themselves are obviously destructive.
LongHairedWeirdo
One of the scary things about the credit default swaps is something I just saw recently. Apparently, people weren’t just buying them to hedge risk to themselves… they were buying them to bet that a default would happen, and make money off of it.
(I also heard that they were turned into bonds themselves, and then bundled and sold. And, presumably, more CDSes were taken on those bonds.)
This provides a big missing piece of the puzzle… I’d been wondering how even a large-ish drop in home values created *this* much of a mess.