Absolutely required listening (if you haven't heard it already--it's from 2008). This American Life and NPR News explore wtf happened in the US housing crisis and resulting economic collapse. Listen listen listen.
(It's 59 minutes long. But hey GW grads, shouldn't be a problem for you!)
Showing posts with label economy. Show all posts
Showing posts with label economy. Show all posts
Wednesday, May 5, 2010
Thursday, March 18, 2010
Liars still at the poker table
I'm reading for a paper semi-related to the current financial crisis, and the first book on my list is Michael Lewis's new release, "The Big Short." Here's a bit of the prologue, where M.L. talks about writing "Liar's Poker."
Up to that point, just about everything written about Wall Street had been about the stock market. The stock market had been, from the very beginning, where most of Wall Street lived. My book was mainly about the bond market, because Wall Street was now making even bigger money packaging and selling and shuffling around America's growing debts. This, too, I assumed was unsustainable.
I thought that I was writing a period piece about the 1980s in America, when a great nation lost its financial mind. I expected readers of the future would be appalled that, back in 1996, the CEO of Salomon Brothers, John Gutfreund, was paid $3.1 million as he ran the business into the ground. I expected them to gape in wonder at the story of Howie Rubin, the Salomon mortgage bond trader, who had moved to Merrill Lynch and promptly lost $250 million. I expected them to be shocked that, once upon a time on Wall Street, the CEOs had only the vaguest idea of the complicated risks their bond traders were running.
And that's pretty much how I imagined it; what I never imagined is that the future reader might look back on any of this, or on my own peculiar experience, and say, "How quaint." How innocent.
Up to that point, just about everything written about Wall Street had been about the stock market. The stock market had been, from the very beginning, where most of Wall Street lived. My book was mainly about the bond market, because Wall Street was now making even bigger money packaging and selling and shuffling around America's growing debts. This, too, I assumed was unsustainable.
I thought that I was writing a period piece about the 1980s in America, when a great nation lost its financial mind. I expected readers of the future would be appalled that, back in 1996, the CEO of Salomon Brothers, John Gutfreund, was paid $3.1 million as he ran the business into the ground. I expected them to gape in wonder at the story of Howie Rubin, the Salomon mortgage bond trader, who had moved to Merrill Lynch and promptly lost $250 million. I expected them to be shocked that, once upon a time on Wall Street, the CEOs had only the vaguest idea of the complicated risks their bond traders were running.
And that's pretty much how I imagined it; what I never imagined is that the future reader might look back on any of this, or on my own peculiar experience, and say, "How quaint." How innocent.
Thursday, February 12, 2009
Carnage
I've avoided blogging about the layoffs in BigLaw because I'm not ATL, but today has been just insane and deserves some attention.
So far today 828 attorneys and staff have been laid off from firms big and important enough to garner Above the Law attention. That's eight hundred and twenty eight people just today. One firm, Luce Forward, even rescinded the offers it had made to people graduating in 2010. What those people will do for gainful employment in this economy, who knows.
Reactions are as expected:
Dear Jesus: Thank you for this box of documents I am about to review. Amen.
If you know a lawyer who was laid off today, buy the poor soul a drink, would you?
So far today 828 attorneys and staff have been laid off from firms big and important enough to garner Above the Law attention. That's eight hundred and twenty eight people just today. One firm, Luce Forward, even rescinded the offers it had made to people graduating in 2010. What those people will do for gainful employment in this economy, who knows.
Reactions are as expected:
Dear Jesus: Thank you for this box of documents I am about to review. Amen.
If you know a lawyer who was laid off today, buy the poor soul a drink, would you?
Thursday, December 4, 2008
Idiot's guide to subprime loan-induced economic collapse
This is what I've been looking for. Thanks Abhay!
Monday, November 24, 2008
Come on, Citibank!
I'm pulling for you guys. Please recover. Don't make me take my next loan refund to the check cashing store!
Wednesday, November 12, 2008
Quick and dirty Big Three analysis
[Keep in mind I've been thinking about this for approximately 7 seconds.]
If we're going to be pumping billions of dollars worth of taxpayer money into the US auto industry anyway, why not use the money to completely reconfigure it to be a world leader in producing various clean (or almost clean) cars? Some parts of a comprehensive plan:
(1) a new research institute, combining universities and private R&D companies, to develop new models that run on a variety of fuel sources (solar cells, better hybrids, full electric cars);
(2) shifting the burden of retiree pensions & health care from the companies to the government--if that's what we're paying for, let's pay for it directly and not through an extra middleman;
(3) retraining of current Big Three employees so they can work on these new cars;
(4) restructuring the car companies: (a) spin off the profitable cars & trucks into a new business that can support itself; (b) retool the remaining bum parts of the companies to make use of the new technology coming out of the research institute;
(5) heavily subsidizing the resulting cleaner cars for purchase by US consumers;
(6) after a few years of this, determining which of the prototypes are working and wean them off the subsidies as they get cheaper.
Leave aside the problems of political will for the moment: your thoughts?
(Inspired by this over at Volokh.)
If we're going to be pumping billions of dollars worth of taxpayer money into the US auto industry anyway, why not use the money to completely reconfigure it to be a world leader in producing various clean (or almost clean) cars? Some parts of a comprehensive plan:
(1) a new research institute, combining universities and private R&D companies, to develop new models that run on a variety of fuel sources (solar cells, better hybrids, full electric cars);
(2) shifting the burden of retiree pensions & health care from the companies to the government--if that's what we're paying for, let's pay for it directly and not through an extra middleman;
(3) retraining of current Big Three employees so they can work on these new cars;
(4) restructuring the car companies: (a) spin off the profitable cars & trucks into a new business that can support itself; (b) retool the remaining bum parts of the companies to make use of the new technology coming out of the research institute;
(5) heavily subsidizing the resulting cleaner cars for purchase by US consumers;
(6) after a few years of this, determining which of the prototypes are working and wean them off the subsidies as they get cheaper.
Leave aside the problems of political will for the moment: your thoughts?
(Inspired by this over at Volokh.)
Tuesday, November 11, 2008
AIG
I need help. Can someone please try to make sense of what's going on with AIG, why it has become such a money-pit for my tax dollars, and what might happen if the government stopped injecting money into it? Are these loans, or are we buying stock? What's the long-term strategy? (Is there one?) I don't understand what's going on, and my cursory search didn't produce a primer worth reading. Explanations, links, and insults about my intellectual capacity are all helpful and encouraged.
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