Wednesday, March 18, 2009

Not Shorters

this began as an attempt at shorters. Ah well.

What do do about AIG?:

For all my sympathy with people whose stupid bets got us into this mess, I am not overeager to hand them more of my hard-earned money. But the AIG retention bonuses raise a question the government is going to have to ask again and again before all this is over: do we want to make a point, or do we want to make money?
I think that Megan's tax dollars are magic. They create a bubble around her, making every street and bridge she drives on hers, every sidewalk. Megan's tax dollars become the last paycheck the policeman pulling her over received, then they fly over to be part of the bonuses given out to AIG. And while she likes that final expenditure of "her" tax dollars best, she'd still rather have the money to buy herself a back-up Kindle 2.
The employees of AIG know which traders are good, and which ones are idiots who made a bad mess worse. But they're not going to tell us--or rather, they'll tell us, and the idiot traders will point the finger at someone else. From what I understand, you can't even just ask which traders lost money--some of the traders will be able to argue, with justice, that they lost money because they were helping the company cut its risk exposure rather than taking bets they might win. Others made good trades that were Overtaken By Events.
My god, I'm not sure $160 million in bonuses is enough compensation for the suffering these poor souls must be experiencing.
Why not just say "no bonuses for anyone at AIG"? To hell with the bums! Well, we now own the company. If we hasten the flight of quality employees out of the company, that will cost us money. The answer might be some kind of performance bond. But as in other financial firms, traders often take as bonus what should be salary, which means that they need at least part of their bonuses to maintain their lifestyle. If they're faced with bankruptcy, the traders who are talented will go elsewhere--the financial market is shrinking, but the top traders still have other opportunities. AIG has a lot of positions to unwind. Do we want to leave the job to the dregs of the organization?
Yes, we do. The organization utterly failed to successfully recognize talent, and placed people in control who literally ruined the company. The dregs of the organization might well include those who had ethics and were thus unfit to help ruin the economy in a shortsighted spree of greedy self-indulgence. Those are the people who should now be in charge.
I don't know the answer to this question. Perhaps it is true, as my interlocutors accuse, that I am too stupid to understand the obvious. On the other hand, perhaps excessive confidence in your diagnosis means that you just haven't asked the right questions.
This is a lie. Megan showed her answer to the question in how she phrased it. She wants the people who fucked everything up to stay in control, because she's comfortable with a system of non-accountability which enriches criminals and toadies.

Measurement error:
Mortgage fraud rose last year even though the number of mortgages issued fell sharply. Or did it? The Washington Post article notes that reporting has probably gone up, because banks are more worried about tracking fraud. There's also the fact that, as I said in the last post, recessions uncover what auditors can't: undoubtedly, a number of people who might have gotten away with the fraud in kinder, gentler times, got caught short.
Sure, some might see this as evidence of the failure of bankers in the recent past to do their fucking jobs and actually evaluate their loan applications, but Megan prefers to see the glass as half full.

Shovel-ready... ish:
I've been saying for months that "shovel-ready" isn't. Angry stimulus proponents said I was confused and probably just shilling for the monied interests I represent.
Advantage: Asymmetrical Information. The Wall Street Journal reports:
That demolition and replacement of a bridge in Penn will probably take until early April to get started, which totally proves that Megan was right in the posts she never really wrote. (The closest I can find in her archives is one post going nuts on Matty Y for saying the stimulus is planned out over an 18 month period, and the should have been infamous post where she said golf courses and casinos should be built with stimulus money.)
So anyway, yes, obviously the fact that a stimulus bill that was passed a little over a month ago has just begun to produce actual construction projects shows the failure of that plan. Megan wins!
I meant to find a clip of Jon Lovitz as Lord Todd in Mom and Dad Save the World doing his little victory dance to put in here, but I'm not sure if it's on youtube, and it's too damned nice out to stay inside looking any longer. So think of it in your head, n I'm out.


FGFM said...

Not to mention that the employee retention argument falls apart when one considers that at least 52 people who received those bonuses have already left the firm.

Keith said...

Do you think she giggles after typing "my hard-earned money", or would that require too much self-awareness?

Dhalgren said...

Wall Street Bonuses never retained anyone. Every year at Lehman, a wave of people would resign once the January bonuses were distributed. Bonuses are expected on Wall Street, and when everyone does it, the bonus as retention tool loses its teeth - especially when it could be $500K one year and $10K the next. Bonuses were supposed to be based on three factors - firm performance, personal performance, and plain 'ol vanilla office politics.

But Megan wouldn't know any of that shit because she never earned a fucking penny in a Financial Services firm.

Downpuppy said...

do do about AIG?

to do? dodo? doo doo?

Megan still dreams of getting her place at the trough. Not going to happen if her resume is as badly edited as her blog.

James McG said...

the food channel on Atlantic has launched - and Megan is nowhere near it, it seems.

Thank God.

Actually looks pretty good.

A trillion dollars has entered the economy, and all she can post is a song about AIG. My God, she really is out of her depth.

Susan of Texas said...

Yes, the food blog is nice. Very of east coast foodie-centered, but that's appropriate to the audience.

Her post today is embarrassing, but that's to be expected too!

James McG said...

She's taking a few days off. On the back of a TRILLION dollar stimulus.

Even for her, I'm fucking staggered.

I'm wondering if she's about to leave the building. The past few posts since Douthat have been deranged.

clever pseudonym said...

I like how her posting will be "light-to-nonexistant."

At least she didn't make jokes about Natasha Richardson dying, though she ought to know, as a professional journalist and everything, that you don't just write things like "also, her husband is my favorite actor" without also giving his name. Even if you're certain your readers know who you are referring to.

And can anyone explain to me what "consider another banal observation about the incomprehensibility of deep evil made" means? I don't understand.

I think that's the most sloppy in the shortest post Megan's ever done.

Bettencourt said...

I don't have anything particular to say about this post -- I just wanted to thank you all for keeping this site running. I've started reading it religiously (especially on days when Sadly No! is especially troll-infested) and the work you do here...well, I'd call it God's work if I believed in Him.

I can only assume that since ladybughead is a narcissist that she must read the site religiously (I'm no narcissist, but if someone started a site called Fire Scott Bettencourt, I'd have to check it at least once a day), but how can she go on with her incompetent and borderline hateful writings while being aware of the continuous and pointed criticism of her ghastly oeuvre?

The only downside to this site is that even after nearly two years of steady postings, she still has not been fired. And considering how many people are losing their jobs these days, that's utterly inexplicable.

M. Bouffant said...

traders often take as bonus what should be salary, which means that they need at least part of their bonuses to maintain their lifestyle.

Maybe the poor "traders" need a union or something. Or just a serious reduction in "lifestyle."

Downpuppy said...

Bonus vs salary is a tax dodge around IRC 162m, which limits deductible compensation to $1 million but exempts performance related bonuses.

That these agreements apply given the perfomance of the companies should give a hint as to how big that loophole is.