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Many life forms that would benefit from greater intelligence, sadly, do not have it.

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20Comments

  1. 1.

    Comrade Stuck

    I just have a hard time reading about this shit. It’s like American culture gives a certain brand of bank robber a good salary, the combination to the vault and a Coup de Ville as a get away car. Then every body stands around scratching their heads wondering what the fuck just happened when the national account comes up goose eggs.

  2. 2.

    srv

    In other dumb and dumber news, T. Boone has abandoned his giant wind farm project.

    But he had already ordered the wind turbines, and doesn’t have the garage space for 687 of them.

    http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa090707_lj_appickens.1a334c9f.html

    Also, a couple of nuke projects have been called off, so someone has told that crowd the feds will not be letting up.

    Oh, those great “environmentalists” – good job. Thanks for all the coal plants.

  3. 3.

    DFS

    The first couple of pages of this thing are kinda confusing in tone. Am I expected to feel sympathy for Jake DeSantis? Seriously?

  4. 4.

    Wile E. Quixote

    That picture of Cassano would look a lot better with some cross-hairs over it. Pity he’s in England where high powered sniper rifles are hard to come by.

  5. 5.

    Walker

    And no one is in jail subjected to clawbacks.

    There, fixed that for you.

    Until these people have all their assets seized, there will be no justice.

  6. 6.

    Xanthippas

    So Lewis has “discovered” that Cassano was largely responsible for much of the mess at AIG? This is not exactly news. Google “AIG Cassano” and see what comes up if you don’t believe me. This article seems more like an effort by some people inside AIG to shift the blame. Which doesn’t mean it isn’t informative or useful, but I don’t see how this is anymore insightful than some of the other things that have been written about AIG over the past year.

  7. 7.

    Mr Furious

    Lewis as in “Moneyball?”

    I’ve already heard from him on this, and it made me so pissed I wanted to break shit. Might not be a good idea for me to read that right now….

  8. 8.

    geg6

    This is really a follow up to a VF article a few months ago that unravelled and also draws on Matt Taibbi’s work on the same. VF and RS have had the absolute best coverage on the myriad financial shenanigans, hands down. Every other news organization have been OWNED by these guys. Hell, Stiglitz wrote pretty much a spot on prediction of how this would all play out about 3 or 4 years ago in VF. I made changes to my 401K based on what Stiglitz was saying then. And did okay (not good, but I’m not hit hard like others I know) through this mess, thank the FSM. All of this was foreseeable and absolutely preventable. DFHs like Stiglitz and Roubini were called Dr. Doom and hysterical and hostile to business which makes you, ipso facto, un-American. Well, the DFHs were right. And they are still right. And fuck these assholes with a rusty crowbar.

  9. 9.

    Susan Kitchens

    I’m a portion of the way through the article, and I hafta say — just from a writer’s standpoint, I’m drooling at the idea of a conversation between Michael Lewis (Liar’s Poker, The End of Wall Street’s Boom) and the guy who wrote that public resignation letter from AIG that was printed in the NY Times a while back (DeSantis).

    The article (at least at this point), crackles like a thriller…

    After a few days [since the open letter was published] of not being able to open a newspaper or go to a Web site without seeing some reference to Jake DeSantis and his letter, I phoned him. “Oh hey,” he said cheerily. “They published my letter.”
    No shit, Jake.
    “Has it worked out O.K.?” I asked.
    “Oh yeah,” he said, “but I had to move my family out of our house.”

    Thriller.. it’s very weird, because on the read-an-article level, it’s well written, and compelling. But the initial shock of last fall is past me, and whatever major shock in the article is yet to come, so I feel as though I’m on an island of temporary (but fun!) drama. The inevitable suckerpunch and the slow burn is yet to come.

    I’m sick, so the only thing I’m drinking is NyQuil, and even so, I don’t think I’ll have a double. One is quite enough.

  10. 10.

    jenniebee

    This effort to find a villain seems awfully like the Great Man theory of history at work. Do you really think that if there hadn’t been a Cassano, this would never have happened? Certainly it would have been slightly different, in a butterfly effect sort of way, but substantially so?

    This isn’t the product of a rogue, this is the product of a system and an ethos that is doing exactly what it was designed to do.

    They’re trying to argue here that the problem wasn’t systemic because the bonus structure at AIG was set up to encourage long-term actions, but it doesn’t really matter that that single element was long-term when the entire calculus of capitalism rewards short-term profit. If anything, the current crisis, in which so many companies played a part, should prove to us that the problem is larger than the policies of any single company, and yet we’re looking not only for a single company to hold responsible, we’re looking for a single individual in that company on which to pin the blame. But the number of bad actors here takes in not only everybody even tangentially involved with CDS on Wall Street, but also everybody who wrote or accepted an Alt-A loan, every poor sap with a high school education who jumped at the chance to buy their first home thanks to an ARM they didn’t fully understand, and, thanks to Congress’s refusal to regulate CDS, all of Congress and, by extension, every voter and non-voter in the country who paid no attention, even when the Glass-Steagal act was brought up in a Presidential debate.

    Of course, the first step in changing that stewing puddle of an environment may be in finding someone to string up for it all. But it does feel an awful lot like making an example of the fox who killed the most chickens, then leaving the rest of the foxes alone in the coop. The problem isn’t that the one fox got too greedy and killed more chickens than was seemly; the problem is that your plan for your coop includes foxes.

  11. 11.

    AhabTRuler

    Yeah, I tried to give the article a fair shake, but I can’t. DeSantis is still an over-moneyed douchebag, and the financial geniuses are still crooks.

  14. 14.

    Barbara

    What the article makes clear is how the swaps set in place by AIG slowly and then quickly degraded in quality over time and that no one noticed until one guy at AIG who was considering buying stock in New Century for his own portfolio read its prospectus and was horrified by its statement of risk regarding its lending practices — and then had an epiphany that AIG was, you know, maybe, insuring this stuff through swaps, so he did some due diligence which, apparently nobody had been bothering with for some time. Based on his due diligence, Cassano gave up the ghost and AIG stopped writing swaps for subprime lending — but not before he had structured some deals to put AIG at risk for providing collateral to its counter parties should its rating fall. And that is what finally took it over the edge — the need to put up that cash as collateral when the deals started going south. It just didn’t have that cash. But you and I did.

    Jake DeSantis is a bit player in this story, and honestly, is a bit of a non sequitur.

    I like Michael Lewis, and nothing compares to the article he did on Iceland earlier this year in VF. His account of the fisherman turned currency trader is like a portrait in miniature of everything wrong that has happened in the last two years.

  15. 15.

    Xanthippas

    @Nicole

    I guess DeSantis thinks he was vindicated by his letter to the NY Times. At least that’s the way he comes off in Lewis’ article. But I don’t think he understands that nobody had a problem with the facts (well, except maybe Taibbi)…it was his tone more than anything that set people on edge. Like any of us are supposed to feel sorry for the guy, because he’s not being treated fairly by the public? Well…okay, then get the hell out and find another job where you can be lauded for your work. Like being a garbage man. And correct me if I’m wrong, but didn’t DeSantis actually not end up quitting? If you’re going to resign in protest, it’s more effective to actually resign.

  16. 16.

    Fulcanelli

    @jenniebee: Well said Jennie.

    This is not complicated. We’ve been betrayed by our elected officials and we’re being held hostage by Wall Street and the investor class and it won’t stop until people start getting hurt or disappearing altogether and they are actually afraid to keep doing this shit. Peaceful revolution is looking less and less like a viable option…

    Oh, never mind, let’s all go back to wasting hours and hours every fucking day in front of the computer cracking jokes and snarking on delusional right-wing bloggers, overpaid chickenhawk op-ed columnists and brain-dead politicians while we go broke.

    That’s what we get for electing a smart, progressive minded black man. We just need a new congress to help him, and shit-canning Harry Reid is a good place to start.

    /rant

  17. 17.

    leo

    And no one is in jail.

    And no one is in jail? Hell, there hasn’t even been a Congressional Investigation. From The Hill (6/30):

    Democratic and Republican leaders have yet to nominate a single person to the high-profile commission aimed at investigating the financial crisis, even though it was signed into law by President Obama more than a month ago.

  18. 18.

    clone12

    The amazing part is that after AIGFP stopped insuring subprime CDOs after 2006 the ibanks basically decided to take on the risks themselves.

    If AIGFP was the “responsible” one, I shudder to imagine all the skeletons we may find among the wreckage that were Bear and Lehman….

  19. 19.

    ninerdave

    Is this:

    a need for subservience in others and an unwillingness to acknowledge his own weaknesses. “When he said that he could not envision losses, that we wouldn’t lose a dime, I am positive that he believed that,” says one of the traders. The problem with Joe Cassano wasn’t that he knew he was wrong. It was that it was too important to him that he be right. More than anything, Joe Cassano wanted to be one of Wall Street’s big shots. He wound up being its perfect customer.

    the summation of the Bush/GOP reign?

    As Jenniebee above put it:

    Do you really think that if there hadn’t been a Cassano, this would never have happened? Certainly it would have been slightly different, in a butterfly effect sort of way, but substantially so?

    I think it’s a reflection of the policy that BushCo laid out (with a minor hat tip to Clinton).

  20. 20.

    patrick

    That article is yet another example of the danger in unregulated free markets and an indictment of the blood-sucking vampires who run it.

    Seriously, Wall Street needs to DIAF.

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