What role did drugs play in the financial collapse?
Cocaine is (I’m reliably informed) a drug that results in intense bouts of over-exuberance as well as a tendency to talk extremely convincingly about stuff you know nothing about. Everyone accepts that a credit bubble occurred in the mid-noughties and that it was a direct result of what the former US Federal Reserve chief Alan Greenspan has referred to as “irrational exuberance”. It could also be argued that traders would be better able to sell absurdly complicated financial weapons of mass destruction after taking a confidence-boosting narcotic such as cocaine. Furthermore, surely only cocaine-ravaged buffoons would actually buy billions of dollars worth of mortgage-backed securities when they were so clearly doomed to explode the minute the property boom stalled.— Did cocaine use by bankers cause the global financial crisis?
“This could well be global finance’s ‘tobacco moment.’”
Federal Reserve Chairman Ben Bernanke told the Senate on July 17 that he “lack[s] full confidence in the [LIBOR] rate-setting procedure.” Moreover, “it’s clear beyond these disclosures that the LIBOR structure is structurally flawed.” Andrew Tyrie, chair of the British parliamentary committee investigating the LIBOR, asked Paul Tucker, the deputy governor of the Bank of England, whether he was confident that it was now working normally. Tucker replied, “We can’t be confident of anything after learning of this cesspit.” Lord Turner added, “We would be fooling ourselves” to assume that trading manipulation was limited to trades. “There is a degree of cynicism and greed which is really quite shocking … and that does suggest that there are some very wide cultural issues that need to be strongly addressed.” In June, Barclays agreed to pay $450 million to British and American regulators, and arrests in connection with the LIBOR are thought to be imminent.Simon Owens is an assistant managing editor at U.S. News & World Report. Follow him on Twitter, Facebook, or Google+. Email him at email@example.com
Madden found that female stockbrokers tend to receive inferior accounts and sales opportunities compared to their male colleagues, which leads to women’s lower salaries. About 1 in 3 full-time stockbrokers are women, and on average, they earn two-thirds of the salaries of their male colleagues. Alpha Consumer: Hidden Sexism at Financial Firms
Most people confuse investing with gambling. Gamblers try to “beat the house.” Investors want to be “the house.” The Smarter Mutual Fund Investor: Are You Gambling or Investing?
Home buyers are thinking, ‘Maybe we don’t need that 7,000 square foot home like we thought we did in 2004 or 2005 when the market was approaching its top. Paul Bishop, VP of research at NAR — Why We’re Shunning the McMansion
A few years ago, I discovered that I had over ten open credit card accounts at the age of twenty five. I had two Discover cards, three Citi cards, two MBNA cards (now Bank of America), and three American Express cards (one personal, one business, and one corporate). I had opened more than one credit card a year since eighteen, which is the earliest you can usually get a credit card on your own (minors can’t be bound to legally binding contracts on their own), and it was far too many. Reasons to Cut Back on Credit Cards
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