{"id":193823,"date":"2008-11-14T06:07:00","date_gmt":"2008-11-14T11:07:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/11\/14\/the-end-of-wall-streets-boom\/"},"modified":"2008-11-14T06:07:00","modified_gmt":"2008-11-14T11:07:00","slug":"the-end-of-wall-streets-boom","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/11\/14\/the-end-of-wall-streets-boom\/","title":{"rendered":"The End of Wall Street’s Boom"},"content":{"rendered":"

Go read the whole thing<\/a>, it’s an inventory of how corruption, self dealing, stupidity, and lack of moral created the Wall Street debacle.<\/p>\n

Upton Sinclair put it best when he said, “It is difficult to get a man to understand something when his salary depends upon his not understanding it<\/span>, though in the case of Wall Street, it is more the year end bonuses than the straight salary.<\/p>\n

Here is a typical quote:<\/p>\n

That\u2019s when Eisman finally got it. Here he\u2019d been making these side bets with Goldman Sachs and Deutsche Bank on the fate of the BBB tranche without fully understanding why those firms were so eager to make the bets. Now he saw. There weren\u2019t enough Americans with sh$#ty credit taking out loans to satisfy investors\u2019 appetite for the end product. The firms used Eisman\u2019s bet to synthesize more of them. Here, then, was the difference between fantasy finance and fantasy football: When a fantasy player drafts Peyton Manning, he doesn\u2019t create a second Peyton Manning to inflate the league\u2019s stats. But when Eisman bought a credit-default swap, he enabled Deutsche Bank to create another bond identical in every respect but one to the original. The only difference was that there was no actual homebuyer or borrower. The only assets backing the bonds were the side bets Eisman and others made with firms like Goldman Sachs. Eisman, in effect, was paying to Goldman the interest on a subprime mortgage. In fact, there was no mortgage at all. \u201cThey weren\u2019t satisfied getting lots of unqualified borrowers to borrow money to buy a house they couldn\u2019t afford,\u201d Eisman says. \u201cThey were creating them out of whole cloth. One hundred times over! That\u2019s why the losses are so much greater than the loans. But that\u2019s when I realized they needed us to keep the machine running. I was like, This is allowed?\u201d<\/p><\/blockquote>\n

People should be going to jail.<\/p>\n

Lots and lots of people should be gong to jail.<\/p>\n","protected":false},"excerpt":{"rendered":"

Go read the whole thing, it’s an inventory of how corruption, self dealing, stupidity, and lack of moral created the Wall Street debacle. Upton Sinclair put it best when he said, “It is difficult to get a man to understand something when his salary depends upon his not understanding it, though in the case of …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[970,973,1004],"tags":[],"class_list":["post-193823","post","type-post","status-publish","format-standard","hentry","category-corruption","category-economy","category-finance"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193823"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=193823"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193823\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=193823"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=193823"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=193823"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}