Comments on: Blame Game

By: David Merkel

David Merkel — Wed, 15 Oct 2008 04:30:47 +0000

That brings the blame total up to 30, dlr.

By: dlr

dlr — Tue, 14 Oct 2008 21:18:22 +0000

The bank regulators at the FDIC. It was their JOB to maintain oversight of the banking industry. Every regulator who allowed the banks they were monitoring to giving liar loans, or pick a rate loans, or zero down payment loans, and didn’t call a halt, should be fired for malfeasance. The regulators who had oversight of Washington Mutual and Indy Mac should be fired. And their BOSSES should be fired. Right up to Shiela Blair.

By: Rob

Rob — Sun, 12 Oct 2008 07:17:41 +0000

Regulators let themselves be compromised by those following the profit motive. Many hoped to make money after joining private industry later.

By: David Merkel

David Merkel — Sun, 12 Oct 2008 03:11:54 +0000

Another keeper, Dojo. If I do version 3, I will add that on.

By: Dojo

Dojo — Sun, 12 Oct 2008 01:38:35 +0000

How about the Prime Brokerage business model followed by most banks and investment banks which allowed their speculative clients to go “nuclear” in any marketplace as long as they had a credit facility and a cell phone. A $10 million hedge fund run out of a basement in Westchester County NY or Orange County CA could control $1 Billion worth of goodies in many cases. Yikes !!

By: will

will — Sat, 11 Oct 2008 03:31:23 +0000

Hi David, I commented a few days ago on “a new speed record” post. Maybe you didn’t want to reply, but I thought there was a good chance you didn’t see it due to the small post. My questions are the same, but with the Fed’s balance sheet declining now with bad quality assets, the inflation potential I fear looks more real. Of course, the dollar is really gaining, which is a baffling thing…

Why would more markets seek out our t-notes, despite the declining quality of our debt? All year I’ve been hearing in my head “S&P lowers its credit rating on US debt.” Que financial Armageddon?

By: Chris

Chris — Sat, 11 Oct 2008 00:12:01 +0000

Please, don’t forget the tax havens – home of hedge funds and money laundring – without which none of this would have happened !

By: proton

proton — Sat, 11 Oct 2008 00:03:56 +0000

I will put RATING AGENCIES at the very top.
They caused instability on the way up and they cause instability on the way down.

Remember not long ago, Moody’s tried to rate all Icelandic banks Aaa. Only the outrage from the investor community stopped them.

By: Bryan Willman

Bryan Willman — Fri, 10 Oct 2008 22:52:00 +0000

A. A running imbalance of fear and greed. Too little fear and too much greed yields a bubble. Too little greed and too much fear yields a collapse.

B. Market and mortgage rules that don’t allow for personal realities. We are all “competing” for things in our finite lives. So NOT taking the big mortgage, or NOT seeking the high return, in effect lost ground in one way or another – socially, or personally, if not financially.

Put another way – some part of market behavoir is set by the environment. No snowflake believes it’s responsible for the avalance, but if there’s a lot of snow on a hillside, there will likely be an avalance regardless of what any snowflakes do.

Which again implies that reasonable regulation, more transparency and accountability, and the occasional recession for house cleaning, are required….

By: Steve

Steve — Fri, 10 Oct 2008 22:20:22 +0000

Can you expand a little bit on #16 please? What is an intelligent view of diversification?