The “Big Lie” is Most Popular Article in Washington Post!
By Barry Ritholtz - November 6th, 2011, 5:30PM
Wow, this is way cool:
My Washington Post article, What caused the financial crisis? The Big Lie goes viral. is the single most popular article of the Sunday paper!
This morning, it was most popular in the Business section, but it seems to gotten have legs, and traffic migrated from the rest of the Post readers (700+ comments, too!).
Check it out:
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Source: Washington Post
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November 6th, 2011 at 5:50 pm
Because people are starved of truth.
November 6th, 2011 at 6:04 pm
Nice work, Mr. Ritholtz!
November 6th, 2011 at 6:08 pm
Truth does matter. The facade is crumbling. OWS, Europe on the brink, record low approval of Congress.
November 6th, 2011 at 6:09 pm
Because the Occupy message is very easy to understand – most of us got screwed and we’re tired of being told to just deal with it. Great article, it’s really important that intelligent and honest business people speak out against the “big lie,” as you have.
Here’s another example, which I’d recommend: http://www.truth-out.org/thank-you-message-world-business-academy-occupy-wall-street/1320177641
November 6th, 2011 at 6:26 pm
Kudos Mr. R. … and to whoever wrote that clever headline too! :)
November 6th, 2011 at 6:52 pm
Nice job, BR! But I have a feeling that the 28 articles about why my Redskins suck will soon take it over!
November 6th, 2011 at 6:57 pm
Well deserved, hopefully BR’s popularity grows.
November 6th, 2011 at 6:59 pm
BR, you’ve been playing the right tune and you are becoming a freaking Rock Star!
November 6th, 2011 at 7:01 pm
Congratulations both on the piece itself – probably the most concise statement of all the many factors behind the financial crisis I have yet read – and on its rightful popularity. We can only hope everyone in DC reads and re-reads it many times.
November 6th, 2011 at 7:08 pm
There is a great hunger for truth, clearly and interestingly expressed. Coming from you, I am not surprised.
November 6th, 2011 at 7:10 pm
Excellent, congrats and thank you, Barry.
November 6th, 2011 at 7:58 pm
You did well.
There are teach ins going on this week about this subject and your writing will go viral.
Thank You!
And both the Jets and Giants put up wins!!!
November 6th, 2011 at 8:16 pm
BR: congrats on the popularity. What you really need to work on is getting Fox News to take you seriously. None of the wingnuts I know will never believe anything in the liberl Washington Post, even if they read it. And, there’s the “blame the government” attitude on top of that.
November 6th, 2011 at 8:24 pm
Barry, I’m surprised that you’re surprised. There’s a reason why your blog is so damn popular…
Just don’t ever stop.
November 6th, 2011 at 8:28 pm
>> What you really need to work on is getting Fox News to take you seriously.
Mike in Nola, nice thought. But, I believe that will *never* happen given who owns/runs Murdoch News and the viewers they service.
November 6th, 2011 at 8:36 pm
Ritholtz – the next US Secretary of the Treasury!
November 6th, 2011 at 8:43 pm
Let’s hope so but I think it’s because we, your RSS feeders, went and read it.
November 6th, 2011 at 8:59 pm
Did anyone notice the link also appears under the main article (Wall St is highly profitable…) as well? Not too shabby.
November 6th, 2011 at 9:05 pm
BR: Bravo! By the time I opened this latest Big Picture I had already seen the article in the electronic version of Washington Post and e mail forwarded to my contacts as OBLIGATORY READING. Should also be obligatory reading in high-schools and colleges across the country. But this may inconvenience too many Business School professors. It’s concise, clear and to the point and I found it right on, I had been waiting for this kind of op-ed for some time now. I loved the enumeration of the causes. For example #3 bullet confirms that chasing yield most always results in neglecting risk with predictable results: tears at the end.
And I agree: they wont repent, big lies almost always work. But, at the risk of repeating myself from a previous comment I made on the theme “Will litigation break WS”, here’s Johnny Cash’ take on this, pls. bear with me first some lyrics:
Well you may throw your rock and hide your hand
Workin’ in the dark against your fellow man
But as sure as God made black and white
What’s done in the dark will be brought to the light
You can run on for a long time
Run on for a long time
Run on for a long time
Sooner or later God’ll cut you down
Sooner or later God’ll cut you down
I picture you as a “kutlurnii man”, a man with many interests and aptitudes. I invite you to listen, when time permits to JC singing “God’ll cut you down”:
http://www.youtube.com/watch?v=IStlBOX9F4o
Yes, the surprisingly few scoundrels (to quote John Bogle) who caused all this, will be cut down; they should have heeded Plato’s warning to the “unjust” so beautifully expressed in his “Myth of Er”.
November 6th, 2011 at 9:33 pm
Your notoriety is well deserved, and you sound sincerely flattered by the attention.
Congratulations, BR!
November 6th, 2011 at 10:03 pm
It’s particularly useful and significant to get BP views and opinions aired in WaPo which as a full member of the MSM tends to be way left of centre on most, if not all issues. I remain hugely impressed that you find the time to do all this and still have a full time day job! Keep it going Barry as a voice of reason in the chorus of fools.
November 6th, 2011 at 10:11 pm
Congrats you deserve it as always. I’m still referencing your articles from earlier this year such as “Lessons from the Ultra Wealthy”.
Would love to see a big piece on your overall opinion of this OWS uprising and your predicted economic affects on wall street over the next several years.
November 6th, 2011 at 10:25 pm
Terrific job, Barry.
In my experience, reason eventually wins out over ingrained biases because repeating the truth hits the right dissonant notes on the keyboard of cognition and eventually even the most hardened truth denier is forced to bring a nickel and tap his feet or go completely nuts.
November 6th, 2011 at 11:23 pm
Barry, founders of a small midwest bank informed me of the regulatory demands they faced in the 2000′s to meet certain metrics relating to lending in low- and moderate-income neighborhoods as required by the Community Reinvestment Act of 1977 and the amendments of 1995 and 2002 which strengthened enforcement actions relating to bank examinations. This is what Mayor Bloomberg referred to, and you fail to address this. One would think from your writing that no government action occurred to encourage (or force) lending institutions to significantly increase the volume of subprime mortgage loans, and this is blatantly wrong.
All of your points are accurate, but the government’s legislation and regulatory enforcement served as a catalyst for the excess expansion of subprime mortages. You should have acknowledged Mayor Bloomberg’s point, and then listed your points.
November 6th, 2011 at 11:27 pm
Barry,
Thanks for telling it like it is.
November 6th, 2011 at 11:36 pm
Nice to hear that your ideas are getting more MSM attention!
November 6th, 2011 at 11:36 pm
Nice to hear that your ideas are getting more MSM attention!
November 7th, 2011 at 12:24 am
PK at NYT also scores the top of the most read with pretty much each and every of his columns.
People are hungry for truth.
November 7th, 2011 at 1:22 am
It’s nice when energy, integrity, synergy and zeitgeist all combine in one massive king hit to the establishment. You and Matt Taibbi! What a team…
November 7th, 2011 at 1:40 am
Read the article comments in the WP: the truth no longer matters to a significant portion of the population, it’s a battle of values based on emotion only.
This ties together some loose ends:
In 1970 Lewis Powell (later US Supreme Court justice) issues the “Powell Manifesto” to the US Chamber of Commerce, stating that the US economic system is under attack:
http://reclaimdemocracy.org/corporate_accountability/powell_memo_lewis.html
This article traces the beginning of the massive change in the US to 1970:
“And then, as suddenly as the improvements had come for mainstream society, the new bonanza for the ultra-rich commenced. The decade from 1970–80 was the turning point in the Great American Inversion… It is as if a big pause button had been hit in 1970 for the bottom 90 percent at the same moment the fast-forward button clicked on for oligarchs.”
http://www.the-american-interest.com/article.cfm?piece=1048
Note that Nixon taking the US off the Gold Standard and ending the Bretton Woods postwar monetary system dates to this same period (1971). Also dating to this same period was the systemic financial dislocation caused by, and the American populace’s discontent with, the first of the really Dumb-Ass Wars, Viet Nam (my current home, by the way.)
In effect, the ruling class started to circle the wagons and see everything outside as the enemy. So you have billionaires like the Koch Bros. get all their billionaire buddies together and plot their mutual salvation from the Forces of Darkness:
http://motherjones.com/mojo/2011/09/koch-brothers-million-dollar-donor-club
If I recall correctly, Atlas Shrugged did not end well for those outside the Colorado valley chosen as the refuge (maybe Telluride? A long narrow mountain valley easy to defend)
November 7th, 2011 at 2:54 am
Whoopeee!!! This is one of the best articles I’ve read in quite some time. Although I do suffer from pseudologia fantastica, so you shouldn’t believe a word I say.
November 7th, 2011 at 3:35 am
Pass alone copies to Occupy Wall Street so they undersatnd why they feel as they do. Many are hoping to make them appear foolish. Many powerful people are hoping to make them appear foollish.
November 7th, 2011 at 5:39 am
Attaway Barry! Now if only the AG would DO something about it.
November 7th, 2011 at 6:00 am
I think many people misunderstand the nature of the Washington Post. The paper that gained its reputation by going after Nixon in the ’70s changed during the ’90s, when it was part of the media mob that worked up the impeachment hysteria. Certainly it had bought the neo-con line by the time of the Iraq war and in the last decade has done little to bring an accurate awareness of conditions in this country. It has its moments, to be sure (I am thinking of the series on the wide-ranging, but utterly chaotic Beltway think-tanks and consultants that the War on Terror has spawned and funded), but I am most aware of the fate of Dan Froomkin, a brave, lonely voice who did not follow the company line and now finds himself at Huffington Post. What I am saying is that Barry producing such articles has more than likely upset a number of his superiors — and that I hope he is the happily married man he says he is and please make sure all your taxes have been paid.
November 7th, 2011 at 6:19 am
[...] Washington Post madness has meant we are overrun with spam, trolls and [...]
November 7th, 2011 at 6:39 am
Before last week I would have been more hopeful about the effects of BR’s excellent article on the financial crisis but since then I have come across a new book and website from David McRaney “You Are Not So Smart of A Celebration of Self-Delusion”. http://youarenotsosmart.com/2011/06/10/the-backfire-effect/
“The Misconception: When your beliefs are challenged with facts, you alter your opinions and incorporate the new information into your thinking.
The Truth: When your deepest convictions are challenged by contradictory evidence, your beliefs get stronger.
In 2006, Brendan Nyhan and Jason Reifler at The University of Michigan and Georgia State University created fake newspaper articles about polarizing political issues. The articles were written in a way which would confirm a widespread misconception about certain ideas in American politics. As soon as a person read a fake article, researchers then handed over a true article which corrected the first. For instance, one article suggested the United States found weapons of mass destruction in Iraq. The next said the U.S. never found them, which was the truth. Those opposed to the war or who had strong liberal leanings tended to disagree with the original article and accept the second. Those who supported the war and leaned more toward the conservative camp tended to agree with the first article and strongly disagree with the second. These reactions shouldn’t surprise you. What should give you pause though is how conservatives felt about the correction. After reading that there were no WMDs, they reported being even more certain than before there actually were WMDs and their original beliefs were correct.
They repeated the experiment with other wedge issues like stem cell research and tax reform, and once again, they found corrections tended to increase the strength of the participants’ misconceptions if those corrections contradicted their ideologies. People on opposing sides of the political spectrum read the same articles and then the same corrections, and when new evidence was interpreted as threatening to their beliefs, they doubled down. The corrections backfired.”
Check this out if you want to live in a world where facts DO matter and see why when they threaten the “narrative” they are dismissed . . its all about the narrative
November 7th, 2011 at 6:40 am
I think a lot of people really do understand what happened, but we feel powerless to affect the outcome. Our voices don’t matter anymore. I often wonder if all the good works to help the poor and middle class muddle through this fiasco are ultimately just aimed at preserving the status quo for our 1%. How can you have a revolution if most they still have a chance to do OK?
“Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.”
November 7th, 2011 at 7:21 am
The unbridled greed of the few has resulted in great damage to global economies and society.
They say no good deed goes unpunished, and the reverse seems to have happened here. Their bad deeds have been rewarded with bailouts, blame shifting and bonuses.
It makes me sick.
I wonder about the psychology of bulls and investors in this environment. Do they really think this is a new paradigm where debt bubbles never burst. The charts below clearly show the extent to which bubbles have grown in the western world.
http://www.australianpropertyportal.com/Research
Are people still living in such a world of delusion? what hope is there for society? Can the ‘Occupy’ protests ever change the minds of people who are that sure bubble are a myth?
Let’s hope we can change their outlook. For if we can’t, the world is doomed.
November 7th, 2011 at 7:54 am
Unfortunately, half of the viewers that made the article popular included people like this who have trolled on over to the BP and posted:
TedDogRun Says:
November 6th, 2011 at 11:23 pm
Barry, founders of a small midwest bank informed me of the regulatory demands they faced in the 2000′s to meet certain metrics relating to lending in low- and moderate-income neighborhoods as required by the Community Reinvestment Act of 1977 and the amendments of 1995 and 2002 which strengthened enforcement actions relating to bank examinations”
Yeah, of course the “stengthened enforcement actions” are not mentioned, but they consisted of “do more lending, nothing to see here, move along.” And of course, this troll refuses to understand that lending by CRA banks declined steadily for ten yars before, and right through the bubble. Nor will he admit that the GOP and their assorted lobbies actually criticized the GSEs and the government during the bubble for not doing enough to increase lending to those in CRA areas.
It is truly like “talking to a kitchen table”.
Sadly, it has to be done.
Kudos to BR for trying to educate people, but it does not work for at least 25% of the country.
November 7th, 2011 at 8:43 am
A party that needn’t be named
Made GSEs chiefly to blame
For the mortgage collapse,
Though inquisitive chaps
Say the data don’t back up this claim.
http://www.limericksecon.com
November 7th, 2011 at 8:47 am
What has always bothered & unnerved me about this current financial crisis hitting the wall when it did is that it was *allowed* to happen with *no* financial cops on the beat doing their jobs ( no small thanks to the ideologically-correct Phil Gram , Alan Greenspan , Robert Rueben , and last , but not least Henry Paulsen) while being fresh on the heals of the other financial crisis that crippled the markets/investors souring our *global crossing* into the 21st century where there *was* absolute criminality & outright fraud.
My consternation ; *Where were the *lessons learned* in restructuring our regs and beefed up enforcement to try and atleast attenuate the next financial debacle throwing us all headlong into that imfamously-streeted Wall.
Oh yeah , it was up to whom controlled the White House to enforce and the Congress to enable that enforcement by over-sight , tighten up regs , and ample reg agency funding.
The mangled bock stops with whom controlled that White house , the House of Representatives & Senate whom collectively could have *uncreated* Fannie/Freddie with but a single stroke of a duly *advised & consented* presidential pen. I guess even the most orthodox of ideologically-correct “let the market free* Gramspanistas can’t deny away just whose due-diligence it was in both the White House & Congress and what a horrendously expensive disaster this abysmally missed opportunity of *lessons learned* this was in too short a time after the fact of the Dot.Bombs & Enron.
Absolutely disgraceful!
November 7th, 2011 at 8:49 am
BR: Thanks for the great article. This is truly one of the most enraging pack of lies being peddled out there. It was cooked up originally, so far as I can tell, by Thomas DiLorenzo in a late 2007 article for either “The Weekly Standard” or “The American Spectator;” I forget which. Anyone with a strong stomach can Google it. While you’re at it, and the Maalox is handy, look up Mr. DiLorenzo’s other “contributions” to our public discourse. The man is what we used to call back on the farm, “A Unique Individual.”
Another fun little piece to look is the Cato Institute’s 2004 “Handbook For Congress.” In it, they advocate the usual things, like privatizing Fannie Mae and Freddie Mac, but they also make absolutely no reference to this line of reasoning that Government has forced the poor bankers to lend to all those irresponsible poor or non-white people. No, lenders were being encouraged to go to the subprime market in search of profits, and they thought they’ve managed to socialize all the risk, said Cato in 2004. Hmm. Wonder what changed in their rationalizations.
I’m a self-employed business meeting coordinator. I’ve sat in several dozen finance-industry symposia over the past decade. Wanna know how many finance-industry CEO’s and high-level analysts etc. I’ve heard blame the CRA and government for the finance bubble, particularly in home finance? Zero. Wanna know how many I’ve heard blame regulatory capture and the aggressive misuse of derivatives? That would be unanimous, bub. And these are insiders, talking to insiders. I’d love to name them but I have a drawerful of confidentiality agreements, and I really love eating and keeping my stuff indoors.
November 7th, 2011 at 9:01 am
Congratulations, it’s a very well-written piece. Few have concisely laid out the reasons for where we are today, and kudos that you were able to to it in a major media outlet.
Keep up the great work!
November 7th, 2011 at 9:36 am
Congratulations Barry…
A Heads-up from the Master himself in the NY Times (blog)…
http://krugman.blogs.nytimes.com/2011/11/07/financial-big-lies/
November 7th, 2011 at 9:51 am
TedDogRun,
All sorts of “catalysts” were used by the frauds. I have a BS but it is not in applying chemistry terms to obfuscation.
Lending with no abuse in under served areas is not lending sub primes loans to individuals who could not meet FHA or FM/FM underwriting standards.
Angelo Mozillo was unconcerned as to catalysts.
You should look at other issues than the one red herring. catalyst.
November 7th, 2011 at 12:20 pm
To make fun of Bloomberg et al’s Big Lie:
A few poor people in our ghettos are blamed for bringing down the entire financial world — our toxic mortgage packs were sold overseas too. Too bad the poor never understood their power; they could have threatened not to pay their mortgages and forced concessions all across the economic landscape (forget about riots)!
Mad King Bloomberg’sconstruction company in my old Bronx neighborhood:
Closed down the Concourse court house which is too beautiful to tear down empty — closed down the BRAND NEW (when I was going there with neighborhood kids in the late ’70s) courthouse down the hill — after building a half billion dollar (today’s money) new replacement AFTER CRIME MORE THAN HALVED.
Built the new Yankee Stadium across the street from the old one — on top of a track and field used by 39 schools — never tore down the old one to rebuild the track and field. Never fear; when enough yuppies take over the neighborhood, like they are taking Harlem, the track and field will surely be rebuild and to much higher (yuppie) standards (see all the new waterfront parks in lower yuppie land).
November 7th, 2011 at 6:01 pm
TedDogRun Says:
“….. founders of a small midwest bank informed me of the regulatory demands they faced in the 2000′s to meet certain metrics relating to lending in low- and moderate-income neighborhoods as required by the Community Reinvestment Act of 1977 and the amendments of 1995 and *2002 which strengthened enforcement* actions relating to bank examinations. ”
Excuse me, but your conveniently unnamed source from and equally conveniently unnamed mid-west sate bares some scrutiny as well seeing as how financial regulation has *always* proven to be anathema to Republican White Houses and/or Congresses and the one already control both from 2001 onward followed anti-regulation AND anti-enforcement doctrine to a*t* so one would wonder out loud just where any regulatory enforcement pressure could’ve possibly come from. Let’s justagree that your “source” is suspect to sayt he least given the public record history that Barry so deftly reported in his book “Bailout Nation” so your chastisement of Barry isat least misplaced without any authority to back up your *annecdotal* unnamed evidence.
November 7th, 2011 at 7:36 pm
Taliesyn@8:47am;
It is actually a lot worse. The reason Fannie and Freddie was encouraged/pushed/allowed into the bad mortgages was that someone had to keep the bubble going until the big boyz had gotten out. Everybody knew it had to end bad; bubble always burst. But by keeping F&F out in the early stages when most of the profit were harvested and letting them in at the end to keep the collapse from happening to soon, the big players could get out with a lot more profit and less loss. Unfortunately the couldn’t get the timing right, and things happened to soon (before they all got out and before a democratic president could become elected and given all the blame).
November 11th, 2011 at 5:22 pm
[...] column from Sunday, The Big Lie, is still the most popular piece still in the Washington Post, and the most popular in the Business section. Its garnered 1,700 [...]