Paul Singer, a member of the board of COMMENTARY Inc. and founder and chief executive officer of Elliott Management Corp., has an important piece today in the Wall Street Journal about the need for a new global regulatory system to prevent the taking of apocalyptic risk:
Creating a regulatory system that reflects the modern-day realities of financial markets is not as difficult as it may appear. The financial structures that destabilized our markets have definable characteristics….It is critical that any new regulatory initiative have a global mandate and contain mechanisms to prevent “risk infection” by countries that try to dodge risk controls. There are legitimate concerns about the time needed to devise a global risk-management system and staff it with individuals with the requisite sophistication and experience. But there are relatively simple solutions.
First, the government can hire private firms to assist in assessing risks posed by complicated financial instruments. Despite the failure of financial CEOs to understand the wizardry invented by their own “rocket scientists,” there are independent firms such as Duff & Phelps that can make sense of these products and serve as objective advisers.
Second, interim steps can be adopted to immediately rein in leverage and risk, such as increasing margin requirements for certain types of instruments. For example, in order to initiate credit default swaps, all parties (including dealers, who currently put up little or nothing) should be required to post deposits or reserves of at least 15%, if hedged against a credit instrument of the same company, and 30% otherwise…
I understand the inclination among free-market conservatives to dismiss the government’s regulatory efforts as misguided. Some government actions over the past year have been reactive and incomplete. Yet these actions have been large and reasonably fast, which were the critical elements for the survival of the system.
Darn spellchecker!
Jennifer, thanks for all your thoughtful posts.
These events remind me of the old saw:
“You can’t make this stuff up!”
And the rejoiner:
“And that’s the sad part.”
Sorry that I’ve already posted this earlier but there were a number of typos. Here is the new, improved and extended version:
Obamaism (1): Noun (see also “straw-man”, “false dichotomy” and “obfuscation”): a) false or faulty logic; b) two or more consecutive sentences deliberately constructed and spoken in such a way as to suggest the speaker believes one thing when in fact, he believes another; c) two or more consecutive sentences deliberately constructed and spoken in such a way as to suggest the speaker takes an argument seriously when, in fact, he does not; d) a statement rephrasing a complex argument which one does not understand in such a way as to suggest that one understands it; e) a seemingly clever lie. [Compare with “Clintonism” (a clever but pathetic lie) and “Bushism” (a malapropism)].
Obamaism (2) Noun (see also “the Chicago Way”): the act of disassociating oneself from people who were once close friends or family but who, through no fault of their own, are no longer useful to one’s career objectives.
Obamaism (3): Noun: a) a political tactic associated with the forty-fourth president of the United States in which a crisis involving one area of policy is cited as a reason to increase the size of government in all areas.
Obamaism (4) Noun: a concept in human resources philosophy that on-the-job training should only take place after a new hire has taken the highest possible position in an organization (now discredited).
A Leftist troll will be here soon with some polling data–because we here hate “facts.”
Cohen might have been to the banking situation what Petreus/Odierno have been in Iraq and had Obama let him do his thing as has (more or less) let them do theirs we could have gone some way to placing the financial system on a stable footing.
Your absolutely right, Jen, that him not getting through the vetting system is a much more serious indictment of the system than it is of him. Anyone who knows him or even knows of him would have no doubt that his personal financial and other affairs are in the kind of pristine order almost no other member of the Obama administration can fantasize about.
FWIW, I’ve been in a room with him within the last 3 months and have heard some of his views on the current crisis and while we can’t be certain that anyone has all the answers, we could be sure he would have had a good portion of many.
I don’t understand why Ms. Rubin finds Obama’s remarks about the size of government alarming. It’s actually a demonstration of the remarkable success of the conservative agenda that even now, with conservatives and Republicans in nationwide disrepute, the president still feels obliged to disclaim any “big-government” ambitions. When a liberal president from a liberal party that also controls the legislature pledges fealty to one of conservatives’ core positions–however insincerely–you should take pride in having won the argument.
Also in a “single day”: DOW up 240 points.
And the Fed, after crunching the numbers, testified definitively that Fannie/Freddie and loans to the poor played almost no part in the current economic crisis. Sorry wingers. Another fantasy burst.
Also, Obama’s speech to the business community was one of his best.
All in all, a great day.
@ 6
Because Obama is lying so transparantely and ostenatiously. Even if the economy was booming he would be saying the same thing. He desperately wants to spend more money and dramatically expand the scope of government and is proceeding to do just that at an impressive clip.
3
williamsmithism:
(Noun) The act of posting the same tired screed in successive threads in a sad attempt to win the approval of the hatemongers of the political Right.
Link?
In the meantime, congratulations, #7, on Obama’s good speech. For you, that must be just like being a Cavaliers (as opposed to “cavalier”) fan and seeing LeBron get 40.
Is the official troll position now that Obama owns the stock market, or just the rallies? Hard to keep up.
Nice job, williamsmith, on the definitions.
Having been raised in Cleveland I’m a LeBron fan (the scrren name refers to a completely different cavalier) and am even willing to forgive him his support of Barry.
The Fed would be very careufl at this point but no person in their right mind could possibly think that a many of those loans would have been made and securitized were Fannie, implicitly backstopped by the government not been not there to buy them up. Some on the right do exagurate the extent to which Fannie and Freddie (and here their ideological predisposition against Fannie and Freddie – which of course should never have existed and should be dismanteled forthwith) are at fault but they obviously are to a significant degree.
Interesting somewhat informed speculation on Cohen’s withdrawal:
http://www.powerlineblog.com/archives/2009/03/023048.php
What’s sad, Che(s), is people who come here, to a blog they hate supposedly hate, and enjoy tormenting people.
cavalier, I suspect that whatever Ches is referring to is another version of the same “debunking” those of us who have been following the argument have been hearing for going on six months now. Quantitatively, the bad loans that the GSE’s are responsible for can’t all by themselves explain the financial crisis. I don’t know of anyone who has seriously argued that they could or did, though simplistic versions of the “rightwing” narrative lend themselves to superfical “disproof” along these lines.
The Cohen withdrawl may actually be the worst sign for the economy yet because it illustrates the completely political and ultimately unserious apporach of the administration to the crux of the problem, the banking crisi.
Yes, Cohen is involved with many on Wall Street. When a patient has a brain tumer he tries to seek out the best brain surgeon. When financial institutions get in trouble they go to the best banking lawyers and such lawyers cannot avoid being involved with “patients” of this sort. Anyone not involved in these events to the extent that Cohen is is so becuase he/she isn’t good enough.
It is one thing for Obama to play politics with the stimulus, health care, education or Sasha and Malia’s ballet lessons, but the fact that he seems to be doing so with banking is genuinely frightening. The failure to address the issue effectively might bring Obama down but far too many people will suffer in the process.
Jan, I don’t know how long you’ve been hanging around in these parts, but some of us have been trying off and on to get CONTENTIONS to institute a grown-up comments system (registration, enforced anti-trolling policies) for many months, but our complaints and suggestions have fallen on deaf ears. I will say that things were a lot worse leading up to the election, when, in addition to the garden variety trolls, two or three obviously deranged individuals were posting here at length and at great frequency. I was ready to end my own participation – it was just getting too ugly to be any part of – and we lost a few interesting regulars around the same time.
I’d urge you to contact the editors and blog-masters directly: Maybe someday someone will act – maybe even before the next time things get intolerable.
Thanks CK, I visit many blogs and forums, but I’ve never seen anything quite like this in my 10 years on the web. They should eliminate comments if they won’t moderate them. I sometimes doubt whether the powers that be read them, but they do have the comment of the day so….
I believe you meant let Tim Geithner in….fortunately, Tom Daschle decided not to risk rejection by the Senate.
CKM and Jan — it’s an interesting issue with the trolls. I’ve seen uglier stuff; e.g., at Townhall (where I almost never look at the comments now, because 99% of them will be juvenile exchanges of would-be clever scatalogical zingers that are a complete waste of time for the thinking person). Townhall seemed to have a policy that comments “flagged” to some critical mass for offensiveness would disappear, perhaps automatically. On the other hand, the site didn’t seem able to effectively exclude some seriously disruptive and offensive posters — even worse than some of the th’owbacks who troll here. They just created new IDs and came from different IPs and got back in.
I do recall, here at contentions, seeing a particularly offensive comment deleted, presumably by the blogger. It was some time back. Probably last year. It may have happened more than once, but once is what I remember. And now that I think about it, it was a really disgusting, intolerable attack on Muslim Arabs. I thought the blog owner was quite right to delete it.
I think I can understand where the contentions managers are coming from, in leaving the forum more open. They probably feel a special responsibility to not exclude opposing viewpoints except under conditions of the most vile breaches of decency standards. I do sense a bending over backward to not cut off expression and dialogue, even with flaming anti-Semites. And I don’t know that that’s even so much a matter of seeking to occupy, as a Jewish-oriented forum, a position of unassailable tolerance or large-mindedness, a sort of Caesar’s wife virtue in the arena of opinion blogging. I think it’s also just that Commentary is in the Western liberal tradition: the “defend to the death your right to say it” formula common to all of us. I’ve seen dissenting views removed from the comment rolls of left-wing blogs for nothing more than registering polite dissent, and I imagine it’s a priority for most right-wing bloggers to refrain from doing that, or appearing to.
I’d also note that I’d rather know the folks at Commentary feel secure enough in the environment of liberalism and the rule of law, here in the USA, that they don’t regard it as necessary to shut themselves off from offensive rhetoric at a blog. And that said, I’ve sworn to myself, after the last few days, to stop with the lame anti-Semite jokes for a while. Pointless rallies with anti-Semites could easily start to take over a blog — and I’ve seen it happen elsewhere too; it’s not just at the Commentary blog. Time for a new topic.
Meanwhile, the scroll bar works really well for skipping right over the usual suspects. I’m still waiting for “Warpublican” to say anything worth responding to, but you’ll have to notify me if he does, because I don’t even read his stuff. Or John Hartland’s, or a few others’.
I don’t envy the job of the blog censor: every decision would be the set-up for a rabbi, priest, and minister joke. All in all, I think I’ve concluded that contentions is right to set the filter pretty wide. It never hurts to be reminded that the unpleasant cacaphony IS the “sound of freedom.” I’ve likened it for a long time to the roar of jet aircraft taking off over your head when you’re on the O-3 level of an aircraft carrier. Jolting, frenzied, inescapable, like all the hounds of hell gathered above you. We call it “the sound of freedom” in the carrier Navy.
It takes a powerful lot of irritating noise for the sound of freedom to produce “Mr. Gorbachev, tear down this wall!” Centuries of pointless babble is the overhead cost of “We shall go on to the end, we shall fight in France, we shall fight on the seas and oceans, we shall fight with growing confidence and growing strength in the air, we shall defend our Island, whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender…”
And if we’re very lucky, once in fifty millennia the sound of freedom will be this: “We hold these truths to be self-evident; that all men are created equal; that they are endowed by their Creator with certain unalienable rights; that among these are life, liberty, and the pursuit of happiness; that to secure these rights, governments are instituted among men, deriving their just power from the consent of the governed.” IF we’re lucky.
But most of the time, it’s just lester and David (the lefty troll) and What’s his name Trout Guy — and us. I can live with that. Let freedom ring!
Let the trolls stay. It’s good to have a reminder of who makes up the Democrat party.
I used to want to have websites regulate trolls, but the reason I like coming here is that every now and then a troll makes some good arguments. I have John Hartland in mind in particular: if he can get past his Bush hatred, he makes sensible arguments on economic policy. I don’t agree with them, but at least they can be made and then debated. Unfortunately, he then devolves back into Bush hatred, which completely blows up his entire argument.
So I agree with #20. Let the trolls stay because the worst they can do is attack you personally and anonymously. If that can get to you then you have no business being on the internet.
I appreciate your sentiments, JED, but, if, say, the Phelps clan had shown up for the Gettysburg Address, it might very well have lost a few members before the day was done. I also recall a similar, if not the same, incident as the one you recall regarding the removal of an out-of-bounds comment at CONTENTIONS, and I take it you don’t disagree with that decision. I suspect you don’t have any problem blocking comment spam either. How about a foul language filter? (I believe there’s one in operation, isn’t there? I’m not sure I’ve ever tested it.)
So, limits are going to be set – it’s just a question of which and where and how. Registration and anti-trolling enforcement are used by a number of larger blogs in the interests of civil discussion, without destroying the flow. If and when the political situation heats up again, or a few fixated anti-neocons go off their meds, you may find yourself wishing for some moderation, too.
Just to be clear, I don’t have much of a problem with the Obama Boyz summarizing the day’s ThinkProgress/DKos/TPM talking points for us, and I very much enjoy the interchange with intelligent centrists and lefties who are willing and able to take responsibility for their own arguments. We don’t see many from the latter group, however.
Get it through your heads: Obama and his Donkey Politburo are GLAD that our economy is crashing.
He used the market crash to help him get elected, and now he’s using it to shove through his big government, Big Brother, big spending, big graft social engineering programs. The official party line from his Press Secretary to his Secretary of State is that the economic crash is a blessing in disguise. His cabinet of “Extremely intelligent moderates” is busy peddling this subversive tripe at every opportunity.
What we are experiencing is not a recession, it’s a CRASH. Nobody is happier about it than the Anointed One and the Democrat party. Its a glorious opportunity for a power grab.
Get it through your heads: Obama and his Donkey Politburo are GLAD that our economy is crashing.
His handlers used the market crash to help him get elected, and now they’re using it to shove through their shared big government, Big Brother, big spending, big graft social engineering programs. The official party line being peddled by everyone from his Press Secretary to his Secretary of State is that the economic crash is a blessing in disguise. His cabinet of “Extremely intelligent moderates” brays this subversive tenet at every opportunity.
What we are experiencing is not a recession, it’s a CRASH. Nobody is happier about it than the Anointed One and the Democrat party. Its a glorious opportunity for a power grab.