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    accounting and competence, down the mines..., 2008-11-13 19:14:36 | Main | the run defense in EA's madden 09 - is it the shoes?..., 2008-11-16 12:03:11

    post-mortems:

    If you haven't already read Dean Starkman's piece in the Columbia Journalism Review, "Boiler Room", you should, before reading Michael Lewis' "The End", which paints the same picture from the perspective of some investors who saw the housing bubble and tried to find ways to short it:

    That’s when Eisman finally got it. Here he’d been making these side bets with Goldman Sachs and Deutsche Bank on the fate of the BBB tranche without fully understanding why those firms were so eager to make the bets. Now he saw. There weren’t enough Americans with shitty credit taking out loans to satisfy investors’ appetite for the end product. The firms used Eisman’s bet to synthesize more of them. Here, then, was the difference between fantasy finance and fantasy football: When a fantasy player drafts Peyton Manning, he doesn’t create a second Peyton Manning to inflate the league’s stats.

    [...big snip to obligatory observation of the obvious...]

    Greed on Wall Street was a given—almost an obligation. The problem was the system of incentives that channeled the greed.

    Other fitting titles for the bit would have been "Meet a Few of Your New Overlords", or "Why Paul Volcker May Not Be The Super Awesomeist Best Choice for Sec. of Treasury of Your Dreams".


:: posted by buermann @ 2008-11-14 21:59:10 CST | link





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