NOw how is all of this so different than gambling? Wall Street is more like Las Vegas than anyone ever thought. Guessing on/against borrower’s credit or default is in a word “stupid”. I have to bail out a bunch of MBA crooks, gamblers and party dogs!
It’s gambling alright, but it’s worse than Vegas. In Vegas, you can’t calcualte the odds of every transaction, and you’re spending your own money. On Wall Street, they’ve been using stochastic simulation models for years, so knew probabllity of housing down-ticks (a 4% negative tick at 30:1 leverage puts you underwater by 20% – this isn’t rocket science); they kept on working the game because they were betting other people’s money and Barney Frank and Chris Dodd were guaranteeing it all!
A little “insurance” regulation in the Credit Default markets are way overdue. Where was the SEC?
It’s disgraceful: the game that Congress started, Wall Street profited from, Congress milked and protected, and now the world suffers. Throw the bums in jail! All of them!
INSURANCE IS GAMBLING ALSO!….don’t you people realize thats all insurance is for the insurer. they gamble on risk. risk/reward, both can be great. or awful, like we are seeing now, lol
Credit swaps were supposed to ACT LIKE INSURANCE but the people who came up with this scheme were smart enough NOT TO CALL IT INSURANCE because if they did they would have been regulated AND would have had to keep a capital fund in place to guarantee payment when the investment tanked. The authors of these swaps should be jailed for a long long time (life without possbility of parole). The buyers of the swaps should be banned from the business for lifetime. Watch this video for an eye opening explanation of what happened. http://www.cbsnews.com/video/watch/?id=4502673n
Zorro – You are EXACTLY correct. If CDS’s were called “insurance” they would have to be regulated. Of course, regulation of insurance is normally the responsiblity of the state – not the feds. Kind of makes you wonder – if these Wall Street wizards called them something other than “insurance” – they must have been concerned about the oversight CDS’s would receive by the state Dept of Ins. It really makes the case FOR state regulation of insurance rather than giving the Federal Gov’t more control – and another opportunity to screw things up!
NOw how is all of this so different than gambling? Wall Street is more like Las Vegas than anyone ever thought. Guessing on/against borrower’s credit or default is in a word “stupid”. I have to bail out a bunch of MBA crooks, gamblers and party dogs!
It’s gambling alright, but it’s worse than Vegas. In Vegas, you can’t calcualte the odds of every transaction, and you’re spending your own money. On Wall Street, they’ve been using stochastic simulation models for years, so knew probabllity of housing down-ticks (a 4% negative tick at 30:1 leverage puts you underwater by 20% – this isn’t rocket science); they kept on working the game because they were betting other people’s money and Barney Frank and Chris Dodd were guaranteeing it all!
A little “insurance” regulation in the Credit Default markets are way overdue. Where was the SEC?
It’s disgraceful: the game that Congress started, Wall Street profited from, Congress milked and protected, and now the world suffers. Throw the bums in jail! All of them!
INSURANCE IS GAMBLING ALSO!….don’t you people realize thats all insurance is for the insurer. they gamble on risk. risk/reward, both can be great. or awful, like we are seeing now, lol
Credit swaps were supposed to ACT LIKE INSURANCE but the people who came up with this scheme were smart enough NOT TO CALL IT INSURANCE because if they did they would have been regulated AND would have had to keep a capital fund in place to guarantee payment when the investment tanked. The authors of these swaps should be jailed for a long long time (life without possbility of parole). The buyers of the swaps should be banned from the business for lifetime. Watch this video for an eye opening explanation of what happened. http://www.cbsnews.com/video/watch/?id=4502673n
Zorro
Zorro – You are EXACTLY correct. If CDS’s were called “insurance” they would have to be regulated. Of course, regulation of insurance is normally the responsiblity of the state – not the feds. Kind of makes you wonder – if these Wall Street wizards called them something other than “insurance” – they must have been concerned about the oversight CDS’s would receive by the state Dept of Ins. It really makes the case FOR state regulation of insurance rather than giving the Federal Gov’t more control – and another opportunity to screw things up!