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by ben_w
1599 days ago
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Absolutely sympathise with the perspective. It’s not really a counter though: for that you’d need to compare 2008 against markets with weaker or absent regulation. I’m not sure the relative weighting of causes, between fraud, the misuse of Black Scholes[0], the elimination of various regulations which has been created at the end of the previous crisis, and the failures of credit rating agencies. At least some of the fraud which did occur resulted in prison time. [0] I did hear one of the big problems was everyone looking at the (Nobel Prize for economics winning) Black Scholes model, applying it inappropriately, and justifying this in the grounds everyone else was doing it. This is hard to fix, and group-think of this type is also very much the kind of failure mode I expect to happen more often in unregulated markets, but that doesn’t mean I don’t expect it to pop up everywhere given time. |
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Could you point me to any examples? When I looked into this the only person to serve prison time during this period was Bernie Maddoff and his great crime was stealing from the rich.