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by adsyoung
5886 days ago
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> You write that like it's unusual. It's not - it's how life works. True. How about substantially more so than usual? > If you want more return, you have to play against someone who thinks that you're incorrect and is willing to pay if they're wrong. I suspect that doesn't describe what most of the participants in the game or those that were collateral damage thought they were doing. If things were simpler, then perhaps the participants would actually understand what they are playing I guess. Which means regulation, ratings and market forces that are intended to stop things getting out of hand might function somewhat better. |
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This case involves folks who wanted to make billion dollar bets on the housing market. It involves folks who had personal attention from Goldman Sachs. (In other words, we're not talking a Schwab IRA with a $10k balance.)
If these folks can't be held responsible for their investment decisions, who can?
> Which means regulation, ratings and market forces that are intended to stop things getting out of hand might function somewhat better.
You're assuming that complexity was relevant even though there wasn't even a correlation.
Note that no one is forcing folks to do complicated deals. Moreover, simple deals are available.
I trash Warren Buffet fairly often, but he's correct when he says that you shouldn't invest in something that you don't understand. Folks who violate that rule should lose their money.