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> Regulatory capture is a consequence of regulation, so its effects are problems with regulation. My point was that if we are looking for people to blame, whet

by crux_ 18y ago

> Regulatory capture is a consequence of regulation, so its effects are problems with regulation. My point was that if we are looking for people to blame, whether we chose to point the finger at Wall St or at "regulators," it turns out it will be the exact same group. > And they were hedged by contracts that were of comparable size. Not at AIG they weren't, which is why so much of our taxpayer money is flowing through them to the counter-parties of their CDS contracts -- e.g., Goldman Sachs. > Note that the foreign banks that bought AIG policies did so with the express permission of their regulators. So when a regulator gives you permission undertake an activity, by doing so they also lift all responsibility from you when you choose to go ahead with it? Regulators have made it possible for me to drink, does that mean it is their fault when I contract alcohol poisoning?

anamax 18y ago
> My point was that if we are looking for people to blame, whether we chose to point the finger at Wall St or at "regulators," it turns out it will be the exact same group. Actually, it's not. Unregulated Wall St has fared far better. >> And they were hedged by contracts that were of comparable size. > Not at AIG they weren't Yes, they were - that's how regulated insurance works. > which is why so much of our taxpayer money is flowing through them to the counter-parties of their CDS contracts -- e.g., Goldman Sachs. The money is flowing because the assets backing up the liabilities weren't actually worth enough and the risk was underestimated. > Regulators have made it possible for me to drink, does that mean it is their fault when I contract alcohol poisoning? It means that you can't say that regulation solves alcohol poisoning.
- crux_ 18y ago
  > Actually, it's not. Unregulated Wall St has fared far better. Like Bear Sterns, Lehman Brothers, Goldman Sachs? > It means that you can't say that regulation solves alcohol poisoning. I never claimed this. What it does mean is that you cannot say that regulation causes alcohol poisoning.
  - anamax 18y ago
    > What it does mean is that you cannot say that regulation causes alcohol poisoning. Since, in your case, the regulator was providing the alcohol, it's fair to say that the regulator deserves some blame. We're somewhere between "regulators were completely useless" and "regulators actively caused problems". It's hard to see how that leads us to "we need more regulators". And yes, the regulators and the banks were the same folk. That's another argument against expecting them to help.
    - crux_ 18y ago
      "we need more regulators" When did I make this argument? No, it is a convenient strawman for you, and a way of changing the topic away from "Who is to blame for the stupid, stupid, stupid decisions on Wall Street and their rather disastrous consequences?" I'm willing to apportion some blame to the regulators, but it's quite amusing to see the hypocrisy of some libertarians when they rush to shield the banking and finance industries from the scorn they so richly deserve; blaming anyone and everyone (usually regulators and/or the government, conveniently in line with their ideology) except for the individuals responsible for the decision! To paraphrase a common libertarian lament, whatever happened to individual responsibility?
      - anamax 18y ago
        > When did I make this argument? All of these discussions are in a context of "what do we do?" with "more regulation" being one of the options.
        crux_ 18y ago
        No, these (specific) discussions are not in a context of "what do we do?" I think it encourages clearer thinking to tackle one thing at a time. Allow me to quote myself in the first sentence of my first post in this thread: > As counterpoints, first consider that blame for the current situation and the proper next steps are two separate issues.

by crux_ 18y ago

anamax 18y ago

> My point was that if we are looking for people to blame, whether we chose to point the finger at Wall St or at "regulators," it turns out it will be the exact same group. Actually, it's not. Unregulated Wall St has fared far better. >> And they were hedged by contracts that were of comparable size. > Not at AIG they weren't Yes, they were - that's how regulated insurance works. > which is why so much of our taxpayer money is flowing through them to the counter-parties of their CDS contracts -- e.g., Goldman Sachs. The money is flowing because the assets backing up the liabilities weren't actually worth enough and the risk was underestimated. > Regulators have made it possible for me to drink, does that mean it is their fault when I contract alcohol poisoning? It means that you can't say that regulation solves alcohol poisoning.

crux_ 18y ago
> Actually, it's not. Unregulated Wall St has fared far better. Like Bear Sterns, Lehman Brothers, Goldman Sachs? > It means that you can't say that regulation solves alcohol poisoning. I never claimed this. What it does mean is that you cannot say that regulation causes alcohol poisoning.
- anamax 18y ago
  > What it does mean is that you cannot say that regulation causes alcohol poisoning. Since, in your case, the regulator was providing the alcohol, it's fair to say that the regulator deserves some blame. We're somewhere between "regulators were completely useless" and "regulators actively caused problems". It's hard to see how that leads us to "we need more regulators". And yes, the regulators and the banks were the same folk. That's another argument against expecting them to help.
  - crux_ 18y ago
    "we need more regulators" When did I make this argument? No, it is a convenient strawman for you, and a way of changing the topic away from "Who is to blame for the stupid, stupid, stupid decisions on Wall Street and their rather disastrous consequences?" I'm willing to apportion some blame to the regulators, but it's quite amusing to see the hypocrisy of some libertarians when they rush to shield the banking and finance industries from the scorn they so richly deserve; blaming anyone and everyone (usually regulators and/or the government, conveniently in line with their ideology) except for the individuals responsible for the decision! To paraphrase a common libertarian lament, whatever happened to individual responsibility?
    - anamax 18y ago
      > When did I make this argument? All of these discussions are in a context of "what do we do?" with "more regulation" being one of the options.
      - crux_ 18y ago
        No, these (specific) discussions are not in a context of "what do we do?" I think it encourages clearer thinking to tackle one thing at a time. Allow me to quote myself in the first sentence of my first post in this thread: > As counterpoints, first consider that blame for the current situation and the proper next steps are two separate issues.