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Canada's Carney works the Incompetence Dodge: Big Money leaderz said to be seduced by opera, skiing

I mean, who wouldn't be? I listen to the Met all the time -- is it still sponsored by Toll Brothers, and if so, can Texaco take it back with some of the money it gouged from me? -- and I'd certainly at least think about going skiing if I had a sense of balance -- or could afford to shatter a limb on the slopes. Anyhow, could it be that our wealthy friends (whose salaries and bonuses we pay) have been easily distracted by bright, shiny objects, and that's the cause of The Big Crunchola?

Regulators and executives were “seduced” by the idea that risk was “spread thinly around the world” by packages of loans, [Bank of Canada Governor Mark] Carney told the British Broadcasting Corp. in a radio interview broadcast today.

I suppose that's a better theory, if you're a banker, than being held criminally responsible for fraud. See here for how the math was bad on spreading risk; and see here for how management was responsible. Much as I respect the Great Republic To The North, Carney's working The Incompetence Dodge (originated here): "The idea was great! Only the execution was faulty!"

But it's fun to watch! Here's the Incompetence part:

Carney, 43 and a former Goldman Sachs [Is Goldman Sachs like the mafia, or what?] Group Inc. investment banker, also said he was troubled by talks he had with bank executives during the past five years.

“If you were having a conversation with a central banker like myself, and the chief executive drifted into opera or the ski slopes of Davos or some type of social setting, that’s an issue,” Carney told the London-based network.

“There is vicious natural selection going on right now in the financial services industry, and it’s appropriate,” Carney said in the interview. “Those who weren’t on top of things are gone or going.”

And here's the Dodge part:

The credit crisis might have been prevented if other countries had regulations like Canada’s, Carney said. The country’s banks were rated the strongest by the World Economic Forum last month.

“It’s like many things -- it’s excess,” Carney said in the radio interview. “Fundamentally, the ideas were sound, but they got applied too widely and ultimately by people who had forgotten about the fundamentals, or never knew the fundamentals of what they were doing.”

"Fundamentally, the ideas were sound...."

No, no, and again no. The ideas were not sound. "complex" and "innovative" derivatives that the bankers used to inflate the housing bubble were not sound -- unless your criterion for soundness is making a few dozen guys at the top of the food chain as much money as possible until the whole scam collapses and takes us all down with it. The bubble was based on fraudulent math, supported by management. The entire financial community had to have known the game would end, as indeed conservative (sane) investors did, and said so, loudly. And the process whereby the bankers who took the rent money to the track and lost it were rewarded with two more trillion of public money was laced with corruption and insider dealing; a ripoff; and we still don't know where our money went.

"Sound ideas" my Sweet Aunt Fanny. I'm telling you, the only sound idea these guys have, and have ever bad, is robbing us blind and getting away clean.

NOTE I am so pleased that the analytical tools we developed under Bush continue to have relevance, and that the financial press reports it with a face whose straightness is only equalled by that of that of the political press.

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Mandos's picture
Submitted by Mandos on

...Canada is not a Republic, it's a monarchy.