4 ms·

Just by your terminology, I trust that you know (at least somewhat) what you're talking about, so... is there an ELI5 for this stuff? I'm completely lost in the

Just by your terminology, I trust that you know (at least somewhat) what you're talking about, so... is there an ELI5 for this stuff? I'm completely lost in these types of discussions. They seem absurdly complicated for (good|bad) reasons? Are we looking at another complexity bubble that's going to burst in 5-10 years... to the detriment of everyone but the "top execs" who'll be bailed out? My impression after reading "Too Big To Fail" -- which, BTW is an amazingly well-written book[1] -- is that "they" will probably get away with all this confusion and obfuscation... right? I really do want to learn at least a little bit, but it seems like such an impenetrable world of concepts, and I really do want to avoid the "news-based" or even "journalist-based" approach to learning about this subculture. (When a Dartboard fares better that your average journalist/investor-proxy, you know you have a gambling problem.) [1] Not sure how accurate it is, but it's really well-written and exciting. Unfortunately, it doesn't delve that much into the technical concepts in Finance :(, though it does mention LIBOR at least once.

tanderson92 9y ago
Regularly read Matt Levine's Bloomberg column and the articles he links to and you'll pick up more than you ever thought you would know about finance. It is also fun, how he explains things. Note: not a substitute for formal study of these things.
cm2187 9y ago
If you read the market section of the FT every day for a year, you will probably read enough articles with an introduction to all of these concepts to have a good enough understanding. But like any other profession, if you dive into the details, it can get quite complicated very quickly. There are lots of introductary books to each area of finance. For interest rates, the best book I have read is Interest Rate Swaps and Their Derivatives: A Practitioner's Guide by Amir Sadr. It's been written a few years ago and some things have moved on since but that's still an excellent, very practical, not too mathematical introduction to interest rate products.
jpttsn 9y ago
Good reasons, imho. The complexity is not (purely) a smoke screen thrown by conspiratorial insiders. Most of the harder tech HN articles would seem just as impenetrable to regular Bloomberg Terminal users.
- freeflight 9y ago
  The difference being that in tech the complexity just happens as a byproduct. With the "finance industry" the complexity is not a bug, it's a feature, to keep ahead of regulators. Every time some immensely profitable "market" gets regulated the "finance industry" does it best to create a new "financial vehicle" to feed that unhinged greed for the fictional perpetual economic and financial growth. It's an endless cat&mouse game that has been going on way too long and got us into this current messy situation where the "finance industry" might just as well be considered a fantasy football league, completely decoupled from the actual day to day realities of the vast majority of human beings, yet still holding massive influence over their futures.
  - jpttsn 9y ago
    I disagree; I think that's just a lazy way to look at an unfamiliar field. Likewise, plenty of clueless non-techies suspect techies are intentionally making tech seem complicated. Why can't Apple make a back door for the FBI and nobody else?

tanderson92 9y ago

Regularly read Matt Levine's Bloomberg column and the articles he links to and you'll pick up more than you ever thought you would know about finance. It is also fun, how he explains things. Note: not a substitute for formal study of these things.

cm2187 9y ago

If you read the market section of the FT every day for a year, you will probably read enough articles with an introduction to all of these concepts to have a good enough understanding. But like any other profession, if you dive into the details, it can get quite complicated very quickly. There are lots of introductary books to each area of finance. For interest rates, the best book I have read is Interest Rate Swaps and Their Derivatives: A Practitioner's Guide by Amir Sadr. It's been written a few years ago and some things have moved on since but that's still an excellent, very practical, not too mathematical introduction to interest rate products.

jpttsn 9y ago

Good reasons, imho. The complexity is not (purely) a smoke screen thrown by conspiratorial insiders. Most of the harder tech HN articles would seem just as impenetrable to regular Bloomberg Terminal users.

freeflight 9y ago
The difference being that in tech the complexity just happens as a byproduct. With the "finance industry" the complexity is not a bug, it's a feature, to keep ahead of regulators. Every time some immensely profitable "market" gets regulated the "finance industry" does it best to create a new "financial vehicle" to feed that unhinged greed for the fictional perpetual economic and financial growth. It's an endless cat&mouse game that has been going on way too long and got us into this current messy situation where the "finance industry" might just as well be considered a fantasy football league, completely decoupled from the actual day to day realities of the vast majority of human beings, yet still holding massive influence over their futures.
- jpttsn 9y ago
  I disagree; I think that's just a lazy way to look at an unfamiliar field. Likewise, plenty of clueless non-techies suspect techies are intentionally making tech seem complicated. Why can't Apple make a back door for the FBI and nobody else?