Too Big to Fail

[Insidious Von]

I read this book for the second time recently and it was even more engrossing than the first time.

However the book isn't entirely objective, Warren Buffet got off too lightly. He didn't take a risk for the good of his his country and he used to crisis to his benefit. As Jamie Dimon observed "Warren only makes deals for the benefit of Warren Buffet".

 

[Insidious Von]

Blind in one eye

The right hand didn't know what the left hand was doing.

Or willfully chose to ignore, that's what happens when you put friendship ahead of business. Lehman's President was driven by acquisitions. Even when the bank's equities started to turn rancid, Fuld didn't rein him in. By the time he was finally relieved of his duties Lehman's more sub primes than any bank could buffer. SpinCo became ShitCo.

Another interesting item is what a burnt out shell President Bush had become, except in name Hank Paulson was the de facto POTUS.

 

[ZeroSumPlus]

what a burnt out shell President Bush had become...

Even as a "burnt-out shell", Bush stopped Putin in his tracks in Georgia in 2008...
By moving in an Aircraft Carrier Battle Group... and threatening to fire.

A threat from George Bush meant business.

Fast forward to 2013-14...
And Putin is rapidly re-constituting the totalitarian Russian Empire...
Since Obama cares more about basketball scores than Foreign Policy.

A threat from Barack Obama doesn't mean shit.

 

[goodguy1977]

Have to agree great book, I will add that everyone involved in that situation can be second guessed now but at the time it was an environment that I hope I will never see again. Everything being done was based not on investment logic but fly by the seat of your pants actions. In alot of cases we couldn't even find stock to borrow to short, speculation on several prime brokers.... wow it was just a mess. As for politicians, Bush probably was burnt out.... but in another book a young senator from Chicago was flip flopping on political issues and taking advantage of the situation at a time when it probably wasn't in the world's best interest.

After reading that book, I really reflected on our current economic situation, what scares me is that really what the US govt did was just throw alot of money at the problem, lowered interest rates even further and changed the accounting of financial instruments back to the system that created the problem. And look at the players who have contributed to this... Bernanke... gone.... Geiterner.. gone..... Barak.... soon gone.... when shit hits the fan folks.... if you thought Greenspan and Bush were scrutinized, wait till Bernanke/Geitner/Obama's actions show their long term effects.

Happy trading

Goodguy

 

[SkyRider]

It is all Goldman Sach's fault.

 

[onthebottom]

In the end the US taxpayer made money on TARP (how often can you say that) except for GM which booked a multi-billion loss for the taxpayer.