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November 04, 2008

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Please shoot me now.

No matter what happens today, it's still about 77 days until 1.20.09.

You can break a lot of stuff in 77 days.

Thanks -

It is hard to know. There is a lot of anecdotal and circumstantial evidence that chief risk officers were tolerated to when they were first given titles at that level since they were saying what the sales and marketing folks wanted to hear, but that the sales folks managed to get the upper hand when the risks became larger or less understood and the CROs were relegated to window-dressing.

Old boy network. Alix must be right for the job because everyone who counts knows him, they are all Repbulicns, they are all rich, they feel entitled to power, We have the same phenomenon in a smaller scale in my village: the Republicans in the community support each other and run the same people over and over regardless of their failure to function responsibly once on the Board. They regard Board memebership as being primarily a social coup. The only action they will support are decisions to use the community's money to serrve individual or groups of individuals provided the individuals are part of the clique. They are rich, they are Repubicans, they are devinely endowed by their creator with the right to rule, you see. Respectable and responisble by definition.

Will Obama have control over the Federal Reserve leadership appointments? Oneof the things I most wnat him to do is clean house, get rid of the incompetents, he cronies, the political appointments. i don't care about the religious or political affliations of the people he promotes as long as they have genuine expertisse in their feilds.

Presumably he became CRO because of his credit experience, though credit can either mean marketing or underwriting loans at most banks. I'd be much happier if this guy had been an actuary rather than a finance guy. I'm not sure how he was qualified for CRO, because an MBA in Finance, even from Wharton, is not inherently training for risk management.

I've read a number of interviews with Brown over the last few years, and it seems he's actually learned a little something from the catastrophe he presided over, so I wouldn't be so terrified of him. Chertoff, on the other hand, who was more responsible for the Katrina debacle, is another story.

I'm trying to keep the cynicism down to a moderate level today, seeing as we may be witnessing an incredible moment in history, but I can't say I'm surprised by this sort of move. In fact, I'd be more surprised if they'd found someone who wasn't tied into the former system to help administrate the bailout.

In fairness, if there were a large pool of successful bank risk management experts available, the Fed wouldn't be hiring in the first place. Those that have not been parties to spectacular failures are probably needed at their still extant firms.

Besides, the optics are so bad there just has to be a sound reason for doing this, right? (I ask non-rhetorically, in a hopeful, event desperate tone.)

Why would any company have a chief risk officer and not listen to him? Because they frequently only had one because it was required. They were checking off the box, as it were.

No need to be concerned about what the actual risks were because a) they could securitize them and sell the risks elsewhere, and b) the people running the company figured to be out with their riches before the bubble burst. Many of them actually made it, too.

freelunch's theory has some merit. Cassandras do get ignored.

IIRC, this happened at Enron, where some of the risk people were trying, to no avail, to steer the company away from the icebergs.

It could be - I have no idea - that Alix was in that category.

Hey, the Bush administration is coming to an end, so those responsible for colossal f**k-ups have to find another bolthole.

This has great comedic potential. Consider the following other possibilities:

Donald Rumsfeld as Human Relations Director
Dick Cheney as Chief Fox in Charge of the Henhouse
George Bush as director of a military strategy think tank
Alan Greenspan as Chief Safety Officer for the Nuclear Regulatory Commission
Sarah Palin as Editor of The New York Times
Rush Limbaugh as Ambassador to the United Nations
Katherine Harris as Head Accountant for a large corporation
Mark Foley as head of a Boy Scout troop
John McCain as a lobbyist

I'm sure that others can add to this list...

you can break a lot of stuff in 77 days

The Times editorial board makes the same point today.

You can break a lot of stuff in 77 days.

They're going to remove all the letters from all keyboards in the Whitehouse, except "W".

I keep coming back to the mental image of a large banner on Wall street saying,"Jump you bastards jump!"

The country where top execs saw no alternative to jumping in 1929 had a bright future. Now America rewards the most irresponsible responsible. It is hard to see how we could do as well as we once did.

Haven't you ever heard of "Too dumb to fail"?

There are always second (and third) acts for the rich and privileged. the current squatter in the White House is the poster boy for this phenomenon and his party's nominee to replace him runs a close second.

That's the way Washington works.I don't think it correct but I don't see it changing even if Obama wins.I do think Obama would be better at this time for America than McCain and that's how I voted.I think we'd all be better off if Bush closed the White House and left it empty until the next president is sworn in.

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