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Challenge: explain to a normie that their life savings is gone forever because of mortgage backed derivatives.

happytoexplain 4y ago
Bad analogy. This explanation has actually been done pretty reasonably by a few people. Further than that - after such explanations, it's clear even to normal people who's to blame, whereas software and cryptography are much more esoteric in that department. Of course there is no justice in either case, but at least normal people can see who is most appropriate to behead in the case of the traditional financial catastrophes, in the purely theoretical revolution.
- rmbyrro 4y ago
  What a flex you pulled off!
  - happytoexplain 4y ago
    Doesn't that mean "brag"? I don't think I'm doing that.
davewritescode 4y ago
What a dumb retort If you got burned by mortgage backed derivatives and lost your life savings, it's ultimately because you were (knowingly or not) speculating on the value of real estate assets and making an assumption about future values of said assets. In the case of Nomad, it's that you put yourself at risk by using their service you could've lost everything you put in.
- nemothekid 4y ago
  >it's ultimately because you were (knowingly or not) speculating on the value of real estate assets [...] >it's ultimately because you were (knowingly or not) speculating on the value of crypto assets Not seeing how these are different
  - pwinnski 4y ago
    They're not. Just as "everyone" was saying that those particular real estate assets were incredibly risky, so too is "everyone" saying that all crypto assets are incredibly risky.
- rmbyrro 4y ago
  I'm sorry, but they were selling shitty sub-prime mortgages as AAA investments, my friend. They claimed high-risk mortgages would turn AAA by the magic of financial and statistical shenanigans. That's not far from "zero initialized vector" shenanigans. Investing in AAA securities is not speculation, by financial standards, by the way.
  - NaturalPhallacy 4y ago
    >Investing in AAA securities is not speculation, by financial standards, by the way. I would argue that it is now after seeing the bullshit the ratings agencies pulled during that fleecing of the world.
TomVDB 4y ago
The first challenge is to find those normies. Somebody who directly invested in MBS is by definition not a normie.
- dcolkitt 4y ago
  Somebody who directly invested the majority of their money in an experimental bridge protocol that raised its seed round 3 months ago is by definition not a normie.
  - function_seven 4y ago
    Which reinforces the top of this thread: "Reason #5734 why cryptocurrency is a non starter for real people."
    - obilgic 4y ago
      However cryptocurrency != "an experimental bridge protocol that raised its seed round 3 months ago"
      - hn_throwaway_99 4y ago
        The main point still stands. The crypto world sees "the code is the law" and non-repudiable/non-reversible transactions as a feature. The rest of the world (correctly in my view) sees it as a bug.
        woojoo666 4y ago
        That "main point" was never justified here. Commenters just assumed that a hack on an experimental bridge protocol reflected on crypto as a whole
  - ohgodplsno 4y ago
    No wall street banker was running around telling everyone how awesome MBSes are. However, morons spamming TikTok, Twitter, Facebook and every social network to find a sucker to invest in their super 20% profit moon monkey future currency can be found in a minute, reaching hundreds of thousands. Plenty of normies lose their money in this.
quickthrowman 4y ago
‘Normies’ didn’t lose all of their money selling credit default options and swaps on mortgage-backed bonds. They wouldn’t have access to the markets for those instruments or the capital to do so, and if they had access or capital, they weren’t a normie.
g8oz 4y ago
"The Big Short" did it pretty well.

Bad analogy. This explanation has actually been done pretty reasonably by a few people. Further than that - after such explanations, it's clear even to normal people who's to blame, whereas software and cryptography are much more esoteric in that department. Of course there is no justice in either case, but at least normal people can see who is most appropriate to behead in the case of the traditional financial catastrophes, in the purely theoretical revolution.

rmbyrro 4y ago
What a flex you pulled off!
- happytoexplain 4y ago
  Doesn't that mean "brag"? I don't think I'm doing that.

davewritescode 4y ago

What a dumb retort If you got burned by mortgage backed derivatives and lost your life savings, it's ultimately because you were (knowingly or not) speculating on the value of real estate assets and making an assumption about future values of said assets. In the case of Nomad, it's that you put yourself at risk by using their service you could've lost everything you put in.

nemothekid 4y ago
>it's ultimately because you were (knowingly or not) speculating on the value of real estate assets [...] >it's ultimately because you were (knowingly or not) speculating on the value of crypto assets Not seeing how these are different
- pwinnski 4y ago
  They're not. Just as "everyone" was saying that those particular real estate assets were incredibly risky, so too is "everyone" saying that all crypto assets are incredibly risky.
rmbyrro 4y ago
I'm sorry, but they were selling shitty sub-prime mortgages as AAA investments, my friend. They claimed high-risk mortgages would turn AAA by the magic of financial and statistical shenanigans. That's not far from "zero initialized vector" shenanigans. Investing in AAA securities is not speculation, by financial standards, by the way.
- NaturalPhallacy 4y ago
  >Investing in AAA securities is not speculation, by financial standards, by the way. I would argue that it is now after seeing the bullshit the ratings agencies pulled during that fleecing of the world.

TomVDB 4y ago

The first challenge is to find those normies. Somebody who directly invested in MBS is by definition not a normie.

dcolkitt 4y ago
Somebody who directly invested the majority of their money in an experimental bridge protocol that raised its seed round 3 months ago is by definition not a normie.
- function_seven 4y ago
  Which reinforces the top of this thread: "Reason #5734 why cryptocurrency is a non starter for real people."
  - obilgic 4y ago
    However cryptocurrency != "an experimental bridge protocol that raised its seed round 3 months ago"
    - hn_throwaway_99 4y ago
      The main point still stands. The crypto world sees "the code is the law" and non-repudiable/non-reversible transactions as a feature. The rest of the world (correctly in my view) sees it as a bug.
      - woojoo666 4y ago
        That "main point" was never justified here. Commenters just assumed that a hack on an experimental bridge protocol reflected on crypto as a whole
- ohgodplsno 4y ago
  No wall street banker was running around telling everyone how awesome MBSes are. However, morons spamming TikTok, Twitter, Facebook and every social network to find a sucker to invest in their super 20% profit moon monkey future currency can be found in a minute, reaching hundreds of thousands. Plenty of normies lose their money in this.

quickthrowman 4y ago

‘Normies’ didn’t lose all of their money selling credit default options and swaps on mortgage-backed bonds. They wouldn’t have access to the markets for those instruments or the capital to do so, and if they had access or capital, they weren’t a normie.

g8oz 4y ago

"The Big Short" did it pretty well.