3 ms·

as financial people continue to invent securities and investment instruments that have no basis directly relating to the demand and supply curve of physical ite

by shareme 16y ago

as financial people continue to invent securities and investment instruments that have no basis directly relating to the demand and supply curve of physical items and than use that to directly bet against their very own customers putting firms and countries at huge risk will see an increase on whistle blower reports on all layers of the financial con games.. While some of Anon methods are certainly illegal. Which is the greater good Anon in jail or the fraudsters with the title financier.. There are unfortunately for this Financier Business Women and Man class far more people that got harmed than helped which should not weigh in on this debate but does explain the motivations ... We are taking workers future earnings to 'bail out these bastards' so maybe the slightly illegal stuff has no point for debate here until we start seeing financiers in jail.. If you think that is harsh.. In the US laws on books that banks cannot be directly involved in liar loans.. ...all loans have to have verifiable collateral either assets or combo of income and credit ratings...its covered by Uniform Commercial Code, FDIC, Federal Reserve requirements, etc.. This is not the only area..remember when banks recently refused to revalue and write off loans? They had US Congress, etc pass new accounting laws that make it no longer illegal to continue with those very bad valuations..

wtn 16y ago
Mod parent up. There's plenty of evidence of unethical behavior (including fraud), particularly in mortgage origination, servicing, and securitization, but the various regulatory agencies will not prosecute.
CWuestefeld 16y ago
I'm troubled by your implication that the end justifies the means. That path leads to evil. I also think you're not understanding finance very well. There's no rational reason to insist that financial instruments must be "directly relating to the demand and supply curve of physical items". There are plenty of good reasons for such instruments, facilitating risk management [1] and liquidity in the markets. [1] Of course, in this case, the particular instruments did the opposite of risk management. This is because their risk models were flawed. I agree with you regarding the moral hazard created by gov't meddling, making it so that financial institutions don't need to learn lessons about ensuring their risk models are based in better-understood methods, or are at least very conservative.

by shareme 16y ago

wtn 16y ago

Mod parent up. There's plenty of evidence of unethical behavior (including fraud), particularly in mortgage origination, servicing, and securitization, but the various regulatory agencies will not prosecute.

CWuestefeld 16y ago

I'm troubled by your implication that the end justifies the means. That path leads to evil. I also think you're not understanding finance very well. There's no rational reason to insist that financial instruments must be "directly relating to the demand and supply curve of physical items". There are plenty of good reasons for such instruments, facilitating risk management [1] and liquidity in the markets. [1] Of course, in this case, the particular instruments did the opposite of risk management. This is because their risk models were flawed. I agree with you regarding the moral hazard created by gov't meddling, making it so that financial institutions don't need to learn lessons about ensuring their risk models are based in better-understood methods, or are at least very conservative.