Simon Johnson’s new Atlantic article The Quiet Coup—about how the crony capitalists of the U.S. financial sector have corrupted our system—has been getting a lot of deserved attention.
But Dani Rodrik isn’t so sure about Johnson’s proposed remedy, and I think Rodrik has a point:
Simon’s account is based on a very simple, and I
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I’m watching a video of a speech that Blackstone boss Steve Schwarzman gave at the Japan Society in New York a few weeks back (private equity is my topic of the week), and suddenly there he is attempting to answer Barbara’s question of why it’s apparently okay to stiff the bondholders at a car company but not at a bank:
It’s one thing
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Evan Thomas’s Newsweek cover story on Paul Krugman is timely, and—as with everything Thomas does—elegantly executed. I especially liked this passage:
If you are of the establishment persuasion (and I am), reading Krugman makes you uneasy. You hope he’s wrong, and you sense he’s being a little harsh (especially about Geithner), but
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I’ve been watching Tim Geithner on Meet the Press (I recorded it). He was also on This Week, and I’ve been looking at the transcript of that, but I don’t think I can bear to watch it. Really, how can people sit through these shows? David Gregory asks Geithner a question, Geithner gives some prefab answer that doesn’t really address the …
We all know the problem with the American financial system. It’s that a few institutions have become too big and interconnected to fail. And so, instead of letting creative destruction work its magic and purge the rottenness out of our financial sector, we’re engaged in a sloppy, counterproductive, hugely expensive effort to keep these …
This is Marion Maneker channeling Nassim Nicholas Taleb:
We cannot have both debt leverage and a hyper-efficient system—the volatility is just too great. What Taleb explains—which no one else does—is that efficiency is already a form of leverage. A highly efficient system removes slack and magnifies small changes. Think of the
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Here’s my latest, about that asset-buying plan Tim Geithner proposed oh so long ago (well, Monday).
No, it wasn’t billed as that. But it’s hard to read this section of the Framework for Regulatory Reform released by Treasury today any other way:
We must create a resolution regime that provides authority to avoid the disorderly liquidation of any nonbank financial firm whose failure would have serious adverse effects on the financial
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So I was sitting there at the Buyouts East private equity conference today, listening to a discussion on “Trudging Through the Credit Winter.” It was a bunch of mid-career guys—mostly from PE firms but also a lawyer and a couple of lenders—talking about how it’s really tough out there but they’re coming up with creative ways to do …
I’m not sure that I entirely understand all the points Hernando de Soto makes in his op-ed piece in the WSJ today, but this one sure is intriguing:
If you think about it, everything of value we own travels on property paper. At the beginning of the decade there was about $100 trillion worth of property paper representing tangible goods
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Alpha magazine’s annual list of the 25 highest-paid hedgies is out, and confirms the fascinating truth that there still are a lot of staggeringly high-paid hedgies out there—even if fewer than the year before. Atop the list, at an estimated $2.5 billion, is Jim Simons, who was one of the highest-paid hedgies before all this craziness …
I gave up on trying to understand politics a long time ago (when I was a political reporter at The Birmingham News and was constantly getting scooped by rivals who had a far better sense than I of what was political dynamite in Alabama and what was not). So I found Jay Newton-Small’s explanation of why the congressional outrage over …
