Not sure if you are watching 60 Minutes, but they have Ken Michael Lewis on talking about the bubble collapse, and I am ready to kick babies I am so mad. When he pointed out that every single person who caused this mess walked away with tens of millions, I almost stroked out all over again.
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Just Some Fuckhead
Michael Lewis.
Ken Lewis is one of the bad guys.
arguingwithsignposts
I’m losing track of all the “collapsojournalists” who are coming out with books these days.
Cat Lady
I was hoping it was Louis CK. Michael Lewis is an acceptable alternative. Ken Lewis is a POS who should be chained to John Thain and his commode and thrown into the East River.
metricpenny
Watching and really angry myself.
I’ve worked in the industry for over 25 years. I’m a consultant and was recently in Canada assisting a US registered investment bank with meeting its regulatory requirements.
An employee was relating a coversation he had with a FINRA representative. He said she sounded so bitter. I told him we all are – at least the ones who don’t work for Goldman Sachs.
batgirl
@Just Some Fuckhead: That makes sense. If it was Ken Lewis, I was going to say that he was one of the men who caused this that walked away with tens of millions of dollars.
Cat Lady
I was hoping it was Louis CK. Michael Lewis is an acceptable alternative. Ken Lewis is a POS who should be chained to John Thain and his commode and thrown into the East River.
moe99
Michael Lewis:
http://www.nytimes.com/2010/03/15/books/15book.html
His book, Liar’s Poker, remains a must read about Wall Street almost 15 years later.
Brian J
What about the scary, poor minorities whose ACORN-style groups forced big banks and their public interest-like lawyers to take on all of those awful loans? COMMUNITY REINVESTMENT ACT, PEOPLE!
PurpleGirl
BrianJ — CRA HAD NOTHING TO DO WITH THE HOUSING BUBBLE. NOTHING, NADA, ZIP.
Mike Kay
Par for the course.
Neil Bush and Jeb Bush walked away scot-free and with bags of cash from the S&L collapse.
Ana Gama
The part of the story that pisses me off the most is the guy with the glass eye who started watching the numbers, predicted what would happen and when, and ended up making bundles. I don’t fault him his take, he kinda earned it. But why the hell couldn’t the rating agencies have figured out what that one guy did?
Joseph Nobles
CRA debunking by Krugman
demo woman
@PurpleGirl: I assumed that he was being sarcastic. On the local paper’s blog someone was ranting about CRA seriously and I and another person explained the act to the person. The person than called us elitist liberals. lol Some folks in the south listen to Neal Bozo’s sound bites and run with it rather than research it.
arguingwithsignposts
@Ana Gama:
Well, according to the Daily Show (???), the SEC folks were too busy surfing for pr0n.
Phyllis
The story about Derek Paravicini is renewing my faith in humanity, however. And making my eyes more wet than usual.
Mark S.
@Brian J:
Please adjust your snark-o-meters everyone.
Is there gonna be another Balloon Juice Tournament Pick-em? Cause I’ve watched about 30 seconds of college basketball this year and am ready to use my scientific formula of picking brackets: pick two one-seeds, one two-seed, and one random seed to get to the Final Four.
The Dangerman
This comment so soon after the discussion of a gun tax holiday is dangerous.
arguingwithsignposts
@Mark S.: Somebody posted a link to a Yahoo group, which is the bracket I assume you are speaking about, in an earlier thread today. I don’t recall which one.
Cat Lady
Michael Lewis may actually be the only person in America with the ability and credibility to explain to Joe Sixpack, like he’s 5 years old, what really happened. Joe Sixpack may not have read Moneyball, but they listen to sports radio and have heard about it and understand the concept, because the right wing nutjob sports talk hosts are able to understand it and discuss it thanks to Michael Lewis’ ability to tell the story.
Srsly, what makes more sense, even if you’re a teabagger – that Wall Street cooked up a scheme for their own Croesus-like enrichment so complicated that even professional investors were unable and unwilling to admit they didn’t understand the modeling, or that poor uneducated immigrants tricked rating agencies, hedge fund managers, high priced lawyers and Wall Street honchos into giving them no-doc loans?
PurpleGirl
The rating agencies — Standard & Poor’s, Moody’s, Morningstar, etc. — are commercial publishers… they aren’t official anythings for the protection of anyone. Their analysts look at things and write reports, which are their opinions of what they looked into, i.e., investment grade, not investment grade, etc. And then they publish them. They are paid by the owners of the bonds, stocks, whatever they study.
clyons11
Outstanding program this week.
I strongly suggest anyone interested in this subject go to This American Life and podcast The Giant Pool of Money and Another Frightening Show About Money.
An aside: as an AP U.S.Government teacher in a public school, I was both gratified and depressed that I teach the financial collapse accurately. My bonus will be considerably less ; )
Kyle
America in the age of Cheney-Bush-Rove. Deliberately cripple the referees, then rob, cheat and steal shamelessly, walk away with massive rewards and never get punished.
Washington got away with the Iraq war, torture, warrantless wiretapping and politicizing every department of the federal government, so why would anyone get upset over the looting of hundreds of billions and crashing the economy?
arguingwithsignposts
@arguingwithsignposts: Too late to edit, but I read “regulatory” when it should have been “ratings.” And the ratings agencies have a screwed compensation system, they are sh*t.
El Cid
I feel bad now for once having resented Ed Meese and Dick Thornburgh for indicting and prosecuting relatively few for the collapse of over 700 S&L institutions.
Ana Gama
@PurpleGirl: True enough. Surely they would have been privy to the same data that the glass-eye guy had.
Mike G
poor uneducated immigrants tricked rating agencies, hedge fund managers, high priced lawyers and Wall Street honchos into giving them no-doc loans
And they were so nefarious that they caused similar funny-money housing bubbles at the same time all across the world, from Spain to Australia. ACORN is just that powerful.
mogden
It’s our beautiful politicians that enabled this whole thing by bailing out the fraudsters and banksters, so I’m not sure why you’re so eager to jump into bed with them again on health care.
PurpleGirl
@Ana Gama: Yes, they are but they aren’t under obligation to disclose negative information to the public. They may tell the client that x,y,z looks bad and they should do something about it. That’s not the same as telling it to a reporter from the New York Times or the SEC. And as we know from Madoff, someone did try to tell the SEC (several times in fact) and the SEC brushed it off.
arguingwithsignposts
@PurpleGirl: The other shitty thing about the ratings agencies is that they hide behind the First Amendment “freedom of the press” while peddling their stuff. Actual court cases and stuff about this one. Again, addressed several times on Planet Money and TAL.
NYT
This is just Phase I. Phase II is when people see how Wall Street uses the bailout mechanisms to increase its wealth enormously.
For instance before the crisis investment banks had to borrow at commercial rates and their leverage ratios were limited by what the market would bear. Now they have access to the Fed window to borrow at super-low rates (.5%) and are limited to what they tell the Fed to allow.
There used to be restrictions on allowing banks to own other companies. This was because they could use their lower funding costs and ability to choke off credit to competitors to control the market.
Those restrictions don’t really exist anymore because investment banks can now control other companies in any industry via their related private equity or hedge fund investments.
In ten years time Wall Street will own a large proportion of the American economy
Annie
@arguingwithsignposts:
Ah, don’t forget the long awaited new book by Andrew McCarthy, who will no doubt school us all on liberty, freedom, and the American way, except for people he doesn’t like. Those people he argues can be put in prison forever because he can read their minds and knows in his heart they have bad thoughts…
R. Porrofatto
One of my favorite tenets of the glibertarian religion is the idea that the Galts that run these businesses will always act in the interests of the company and shareholders, if not the society at large. If someone went back in time and asked AIG Swap-King, Joe Cassano, “Okay, Joe, you’re going to make $300 million dollars just this year alone on this shit but you should know that what you’re doing is gonna bring down the entire company!” let’s guess what Joe’s choice might have been.
bkny
fwiw, andrew cuomo has charged ken lewis with fraud.
Ana Gama
@PurpleGirl: Oh I know. (sigh) Seems to me that there is no reason for the rating agencies to exist. There is certainly no reason to purchase their crap or trust their “opinions.”
AhabTRuler
I wish I could. I recognize that TAL does some good infotainment, and most of it is actually quite informative (although sometimes the relevancy is a little adrift), but I cannot listen to the show without the insistent urge to punch Ira Glass in the mouth. I’ve really, honestly tried to like his style, but I can’t.
Emma
I just finished listening to the audio version of No One Would Listen, by Harry Markopolos, the guy who kept chasing the Feds to tell them that Madoff was running a scam. Jesus. Enough to put you off Wall Street AND the regulatory agencies for life.
Markopolos has a healthy ego and comes across as over-the-top sometimes, but… he submitted detailed information three times, and got crickets in return.
I kept swearing. Do you know what was the information most requested from Madoff by the Feds? Employment applications.
Jesus Christ.
Elizabelle
Steve Pearlstein, business columnist and one of the about 3 reasons to read WaPost at all, gives Michael Lewis’s book a thumbs up:
If you read only one book about the causes of the recent financial crisis, let it be Michael Lewis’s …
… “The Big Short” manages to give us the truest picture yet of what went wrong on Wall Street — and why. At times, it reads like a morality play, at other times like a modern-day farce. But as with any good play, its value lies in the way it reveals character and motive and explores the cultural context in which the plot unfolds.
What Lewis writes of two of his characters, young Ledley and Mai, might just as well apply to Lewis himself, or to us:
They “had always sort of assumed that there was some grown-up in charge of the financial system whom they had never met; now they saw there was not.””
http://www.washingtonpost.com/wp-dyn/content/article/2010/03/12/AR2010031202291_pf.html
Angela
@PurpleGirl: “Connecticut Attorney General Richard Blumenthal is suing Moody’s Investors Service and Standard & Poor’s over ratings the agencies issued on certain investments.
In the civil lawsuit filed Wednesday, Blumenthal alleges Moody’s and S&P knowingly assigned false ratings to complex investments that helped push the country into recession.”
http://www.google.com/hostednews/ap/article/ALeqM5i77MOfmBhUi5Ve8g5uqqrZ7qzNkQD9EBTBT80
BerkeleyMom
Lewis’s book on Wall Street, Liar’s Poker. was written in 1989 and sets the stage for what’s going on now. Great book as is Money Ball. Sandra Bullock should have thanked the guy in her Oscar speech for writing The Blind Side.
Love his comment that the biggest trick on Wall Street is that the guys who made the mess have to make more money cleaning up the mess as they are the only ones who understand it.
Fuck Moody’s and Standard and Poor’s, also.
Joseph Nobles
Ah, jeez, that was snark, wasn’t it? It’s so obvious now.
Oh, well, that’s a great Krugman link.
Janet Strange
@AhabTRuler: IIRC there’s not much Ira in A Giant Pool of Money or Another Frightening Show about the Economy. Probably just the intro. The folks who now do the Planet Money podcasts did those stories.
I’ve made about 20 copies of those two shows and given them away – and I’m totally addicted to Planet Money. Highly recommended.