BBC Interview on Banking
By Barry Ritholtz - September 16th, 2009, 5:00PM
I am in the 2nd half of the interview:
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Over the past year, bankers have been blamed for much of the financial crisis. But how does it look from the perspective of those working in the banks? The BBC’s Matt Wells reports from Wall Street.
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Source:
Aftershock: how well has the financial crisis been handled?
14 september, 2009 – 13:50 GMT
http://www.bbc.co.uk/worldservice/news/2009/09/090914_lula_and_wells_wt_dm.shtml
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September 16th, 2009 at 5:25 pm
lol, touche’, lmao
September 16th, 2009 at 6:48 pm
“Borrow at 3 percent, lend at 6 percent, and tee off on the golf course by 3 PM”
That’s an awesome regurgitation of how we used to describe commercial banking, Ritholtz, except it hasn’t been that simple since THEY repealed Glass-Steagall. It’s more like borrow at 1 percent, lend at 5 percent, securitize and sell at 14 percent, and…who cares?
I just wanted to mention that Happy Wanker calls you The Big Man. Kind of similarly, I asked your permission to call you Mr. Big Head, http://www.ritholtz.com/blog/2009/09/depression-versus-recession/#comment-213827
Eh, just kidding, Ritholtz. You don’t have to be sensitive about it! I am done proposing trades in the Ritholtz fantasy football league, so see you again sometime.
September 16th, 2009 at 9:43 pm
Nassim Taleb on fire about REAL US economy !
Margaret Wente: Happy days are here again. The central bankers say the recession is over. The markets are buoyant. Can we relax?
Nassim Taleb: Not at all. Central bankers have no clue. In the first place, the financial crisis was not a black swan. It was perfectly predictable. They ignored the phenomenal buildup in leverage since 1980. They acted like airline pilots who’d never heard of hurricanes.
After finishing The Black Swan, I realized there was a cancer. The cancer was a huge buildup of risk-taking based on the lack of understanding of reality. The second problem is the hidden risk with new financial products. And the third is the interdependence among financial institutions.
MW: But aren’t those the very problems we’re supposed to be fixing?
MT: They’re all still here. Today we still have the same amount of debt, but it belongs to governments. Normally debt would get destroyed and turn to air. Debt is a mistake between lender and borrower, and both should suffer. But the government is socializing all these losses by transforming them into liabilities for your children and grandchildren and great-grandchildren. What is the effect? The doctor has shown up and relieved the patient’s symptoms – and transformed the tumour into a metastatic tumour. We still have the same disease. We still have too much debt, too many big banks, too much state sponsorship of risk-taking. And now we have six million more Americans who are unemployed – a lot more than that if you count hidden unemployment.
MW: Are you saying the U.S. shouldn’t have done all those bailouts? What was the alternative?
NT: Blood , sweat and tears. A lot of the growth of the past few years was fake growth from debt. So swallow the losses, be dignified and move on. Suck it up. I gather you’re not too impressed with the folks in Washington who are handling this crisis.
Ben Bernanke saved nothing! He shouldn’t be allowed in Washington. He’s like a doctor who misses the metastatic tumour and says the patient is doing very well. The first thing I would tell Chinese officials is, how can you buy U.S. bonds as long as Larry Summers is there? He’s a textbook case of overconfidence. Look what happened to Harvard’s finances. They took a lot of risk they didn’t understand, and it was a disaster. That’s the Larry Summers mentality.
Complete interview with kudos to The Globe and Mail because US MSM probably would not publish!
http://www.theglobeandmail.com/report-on-business/crash-and-recovery/we-still-have-the-same-disease/article1286246/