Monday, Apr 05, 2010
Hedge Fund manager who made all the right calls
New York Times: I saw the crisis coming, why didn't the Fed?
All the signs were there for this HF manager, who bet against (took CDS positions on) MBSs and the bonds of financial companies which would go belly-up when the crisis hit. Dangers were obvious from way back in the early 2000s. Then he took into account that counterparties to his CDSs could default, so he avoided Bear and Lehman, was suspicious of AIG's AAA-rating, and demanded daily collateral settlement. He liquidated most of his CDS positions in 2007 at a big profit. Then he figured that govt intervention would turn the tide, so he sold the remaining CDSs to Wall St. banks by then desperate to buy insurance against default. Greenspan, who made all the wrong calls, turned round and said the guy was just lucky!!!!! The only policy left after these screw-ups was to screw the taxpayer.
6 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. icarus said...
Sorry, it's at http://www.nytimes.com/2010/04/04/opinion/04burry.html
2. icarus said...
Unbelievable that these people can claim to have saved the world financial system and hence the world economy.
3. chrisa said...
New York Times: I saw the crisis coming, why didn't the Fed?
Answer: Stop thinking that this was caused by greed or incompetence or lack of regulation. It was planned.
4. drewster said...
No politician wants to take away the punchbowl just as the party is in full swing. That's supposed to be the responsibility of independent central bankers.
Instead, our leaders in Washington either willfully or ignorantly aided and abetted the bubble. And even when the full extent of the financial crisis became painfully clear early in 2007, the Federal Reserve chairman, the Treasury secretary, the president and senior members of Congress repeatedly underestimated the severity of the problem, ultimately leaving themselves with only one policy tool — the epic and unfair taxpayer-financed bailouts. Now, in exchange for that extra year or two of consumer bliss we all enjoyed, our children and our children’s children will suffer terrible financial consequences.
You don't have to be a conspiracy theorist to see how politicians turned a blind eye. Greenspan told them what they wanted to hear, and they weren't going to rock that boat. Even today, everyone blames the bankers rather than the politicians.
5. rumble said...
"everyone blames the bankers rather than the politicians"
-- Exactly. The government sells itself as necessary to run the show - they ran it into the ground. Bankers took their opportunities, and in other news water flows downhill. The government now spouts off about regulation, shutting the stable door after the horse has bolted, the immune system attacking a mutated virus - a step behind, a waste of time, but they need to go through the motions, as worthless as their economy, so as to demonstrate that they're necessary. The government milked the money makers to buy off the mob.
6. 51ck-6-51x said...
So true.
I saw Cameron saying "We need to change politics in this country" - I thought , "yeah that's true", then in the next breath he said "Politicians need to be more accountable to the people" - I thought "oh, well that would be a start but what are you proposing here? More referendums, more lobbying, or less political process?! I seriously doubt the latter as it's how you make your living ain't it? No doubt the former would be brushed under the carpet so it'll be the lobbying option wont it?" *sigh* I hate politicians, they are either scum or unsuccessful; not so much by their own fault - they don't have the not inventive to do The Right Thing.