Alarming News: I like Morgan Freeberg. A lot.
American Digest: And I like this from "The Blog That Nobody Reads", because it is -- mostly -- about me. What can I say? I'm on an ego trip today. It won't last.
Anti-Idiotarian Rottweiler: We were following a trackback and thinking "hmmm... this is a bloody excellent post!", and then we realized that it was just part III of, well, three...Damn. I wish I'd written those.
Anti-Idiotarian Rottweiler: ...I just remembered that I found a new blog a short while ago, House of Eratosthenes, that I really like. I like his common sense approach and his curiosity when it comes to why people believe what they believe rather than just what they believe.
Brutally Honest: Morgan Freeberg is brilliant.
Dr. Melissa Clouthier: Morgan Freeberg at House of Eratosthenes (pftthats a mouthful) honors big boned women in skimpy clothing. The picture there is priceless--keep scrolling down.
Exile in Portales: Via Gerard: Morgan Freeberg, a guy with a lot to say. And he speaks The Truth...and it's fascinating stuff. Worth a read, or three. Or six.
Just Muttering: Two nice pieces at House of Eratosthenes, one about a perhaps unintended effect of the Enron mess, and one on the Gore-y environ-movie.
Mein Blogovault: Make "the Blog that No One Reads" one of your daily reads.
The Virginian: I know this post will offend some people, but the author makes some good points.
Poetic Justice: Cletus! Ah gots a laiv one fer yew...
Did he create the monster that is rampaging through our economic village?
In 1985, aged 30, Mr. [Michael] Osinski and the woman who was now his wife moved to New York, and he landed his first job on Wall St with Salomon Bros as a programmer. “In the pecking order, the computer guys were slight above the typing pool, figuratively and literally,” he said. “We were a necessary annoyance for the traders.”
But that was all about to change. Just two years earlier, finance firms had started experimenting with “securitisation”, the process of turning mortgages into securities designed to spread the risk to lenders and investors.
When Mr Osinski asked his manager how these securities worked, he was told: “You put chicken into the grinder and out comes sirloin.” His boss added perceptively that the bonds were also a guarantee of employment for computer programmers.
:
Mr Osinski bounced around various Wall St firms and ended up in 1995 with the company that supplied the software for nearly all the big finance houses. It was also around now that a client asked him to enhance his software to include a new ingredient – “subprime” debt. Mr Osinski’s reaction was excitement at the prospect of both new customers and new challenges.The loans were so-called because they were made to people who failed to meet standard, or prime, borrowing requirements, presenting a higher risk that was covered by charging much higher interest rates than for borrowers with good credit histories.
With house prices rising year after year, the theory was that people could simply refinance their properties at higher values and take out new loans as their repayments increased. The laws of house price cycles were collectively forgotten or ignored, and lenders and borrowers alike were caught up in the wave of hubris, greed and naivety.
It’s a fascinating story. Perhaps I’m biased…but it seems to me the guilt Mr. Osinski bears for our financial crisis, is on par with the guilt shouldered by a gun manufacturer in the wake of a murder/suicide. He built the freakin’ tool. Just like Shane said about the sidearm — it’s as good or as evil as the man that carries it.
“It is certainly unnerving when you see the world crumbling around you and you have an intimate knowledge about how that process came about,” he said.
He has regrets every day, but they are tempered with the belief that others misused, sometimes fraudulently, his work. “One thing, don’t portray me as a monster,” he said, before going back to emptying the oyster cages he had just recovered from the sea-floor.
You know what we used to call this in my first job? GIGO. Garbage In, Garbage Out.
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Well…
Maybe. There’s something about the gun-manufacturer analogy that goes clunk, somehow, but I can’t quite express it. It’s notable that the Telegraph article refers to Bonfire of the Vanities while ignoring Michael Lewis’s Liar’s Poker. One of the points Lewis makes is that the managers of Salomon Brothers, et al, were happy to make money off schemes they didn’t understand. The stunning lack of fiduciary responsibility displayed was, in his view, tantamount to the destruction of the traditional culture of Wall Street.
I just find it impossible to believe that anybody on Wall Street in the ’90s could have been as blissfully unaware of the consequences as Osinski portrays himself; the phrase “only following orders” springs to mind. Maybe a better analogy would be to a gun designer who built in fatal flaws that would somehow help the company get rich in the meantime? I dunno; I’m not as good at this as you are, for sure.
I will say it’s difficult, deep in my blue-collar soul, to feel any sympathy for a guy whose penance is expressed by having to “farm oysters in the waters off his summer house on the North Fork of Long Island.”
- rob | 04/07/2009 @ 15:00