3 ms·

Since I've started working in finance, I find all those conspiracies about banks and "wall street" a bit cringe: HSBC is actually a nice bank, they helped me a

by xwolfi 2y ago

Since I've started working in finance, I find all those conspiracies about banks and "wall street" a bit cringe: HSBC is actually a nice bank, they helped me a lot, hedge funds do lose as much money as they make in aggregate across all of them because end of the day it's all a random 0-sum with losers paying winners, inside an investment bank, risk is very managed and boring, deal makers spend lots of time trying to reject proposals, loans are rarely predatory and not always easy to get because nobody wants bad payers, bonuses are scarse, etc. The headlines about some crisis with uneducated comments about how rich bankers exploit the weaks make me hesitate to trust journalism. Often incompetence is way more prevalent than nefariousness ... Each time I say stuff like that I get comments saying "maybe but it's not a reason to defend banks", completely missing that it's exactly my point: this hatred of banks is a bit irrational, I think it's fine sometimes to defend them...

vundercind 2y ago
The flip side of this is that I’ve repeatedly seen people in some industry subject to new regulation claim that some effect of it is an unfortunate accident (when it’s actually the point, the behavior it’s stopping that you think is good is actually unethical and system-wide contributes to huge problems in ways that ought not be hard to understand) or that much-needed regulation is some terrible mistake that people will regret when we have strong evidence (like, real world examples) to the contrary. Granted I’ve mostly seen that in the real estate world, so maybe other industries are less-shit about saying plainly dumb stuff based on “insider knowledge” (self-serving bullshit, actually) See also: cops and all manner of things, like the relative riskiness of their own job (and which parts of it are risky—all that driving is a lot of the risk, and Covid-19 vs guns is a fun comparison for some years) or how dangerous it is to be within one meter of a small amount of fentanyl or whatever, or how we’ll all just super regret it if we keep them from trampling on civil liberties (common view, not making that up) Sometimes the insiders know better and everyone else is wrong. Sometimes the insiders are all sorts of mixed up over some comically basic shit.
Anotheroneagain 2y ago
"loans are rarely predatory" misses the point why they are bad. They are bad for the economy because it's you (not the market) who decides who gets resources.
- xyzzyz 2y ago
  What do you mean? Loans are part of the standard market operations and have been since forever, literally thousands of years.
  - Anotheroneagain 2y ago
    They weren't, they were likely invented in Ancient Rome, and soon recognized as harmful, and were illegal until recently, when they got allowed, and again recognized as harmful during the great depression (the Chicago plan that was never implemented). The problem is that you only see the gains that those who take a loan get, but it only allows them to circumvent the market, and nothing is in fact created, only the resources get misallocated. Somebody else would use what got bought with the money.
    - xyzzyz 2y ago
      Loans existed for at least as long as writing has, and probably for the entirety of humanity’s history. Code of Hammurabi had laws regulating loans, for example. Why loans result in resources being misallocated? This doesn’t make sense to me. Say, I have some cash I want to save for retirement. Until then, I loan it to other people to run their businesses. Where is misallocation here?
      - Anotheroneagain 2y ago
        They buy something for the money. That is the misallocation. They couldn't afford it, and your loan allowed it. Let's say they buy a tractor. The tractor would be bought by somebody else. Or perhaps different machinery would be manufactured, or perhaps something completely different would be done, or nothing at all would be done because people would prefer to have more free time. This is how you get massive market imbalances that lead to the great depression, or Evergrande. No money is known that was used before classical antiquity, it must be a mistranslation.
rayiner 2y ago
This is my exact feeling about legal coverage. It’s not clear to me that most journalists have even a middle school understanding of what “law” is.

by xwolfi 2y ago

vundercind 2y ago

The flip side of this is that I’ve repeatedly seen people in some industry subject to new regulation claim that some effect of it is an unfortunate accident (when it’s actually the point, the behavior it’s stopping that you think is good is actually unethical and system-wide contributes to huge problems in ways that ought not be hard to understand) or that much-needed regulation is some terrible mistake that people will regret when we have strong evidence (like, real world examples) to the contrary. Granted I’ve mostly seen that in the real estate world, so maybe other industries are less-shit about saying plainly dumb stuff based on “insider knowledge” (self-serving bullshit, actually) See also: cops and all manner of things, like the relative riskiness of their own job (and which parts of it are risky—all that driving is a lot of the risk, and Covid-19 vs guns is a fun comparison for some years) or how dangerous it is to be within one meter of a small amount of fentanyl or whatever, or how we’ll all just super regret it if we keep them from trampling on civil liberties (common view, not making that up) Sometimes the insiders know better and everyone else is wrong. Sometimes the insiders are all sorts of mixed up over some comically basic shit.

Anotheroneagain 2y ago

"loans are rarely predatory" misses the point why they are bad. They are bad for the economy because it's you (not the market) who decides who gets resources.

xyzzyz 2y ago
What do you mean? Loans are part of the standard market operations and have been since forever, literally thousands of years.
- Anotheroneagain 2y ago
  They weren't, they were likely invented in Ancient Rome, and soon recognized as harmful, and were illegal until recently, when they got allowed, and again recognized as harmful during the great depression (the Chicago plan that was never implemented). The problem is that you only see the gains that those who take a loan get, but it only allows them to circumvent the market, and nothing is in fact created, only the resources get misallocated. Somebody else would use what got bought with the money.
  - xyzzyz 2y ago
    Loans existed for at least as long as writing has, and probably for the entirety of humanity’s history. Code of Hammurabi had laws regulating loans, for example. Why loans result in resources being misallocated? This doesn’t make sense to me. Say, I have some cash I want to save for retirement. Until then, I loan it to other people to run their businesses. Where is misallocation here?
    - Anotheroneagain 2y ago
      They buy something for the money. That is the misallocation. They couldn't afford it, and your loan allowed it. Let's say they buy a tractor. The tractor would be bought by somebody else. Or perhaps different machinery would be manufactured, or perhaps something completely different would be done, or nothing at all would be done because people would prefer to have more free time. This is how you get massive market imbalances that lead to the great depression, or Evergrande. No money is known that was used before classical antiquity, it must be a mistranslation.

rayiner 2y ago

This is my exact feeling about legal coverage. It’s not clear to me that most journalists have even a middle school understanding of what “law” is.