Charlie Rose

vongleichent  02/10/2013 12:48 PM Report

I had enough of the financial crisis. When are the good times coming back?

NeilMacCallister  02/09/2013 09:39 PM Report

Alan Blinder: "The economy fell off the table in the Fall of 2008"

(..Greek chorus: "That's when Obama got elected.")

Jonathan Swift: "There's none so blind as they that won't see".

SharkswithfrikingLazers  02/09/2013 03:52 AM Report

TED on cheating:

"If we have an incredibly simplistic view of human nature - which is not correct - we're not going to get to the behavior that we want.

So I think in all of those cases, it behooves us to have a bit more humility, to question our assumption of human beings, and to basically try to experiment a bit more before we implement all kinds of policies."

So what have we learned from this, about cheating? We've learned that a lot of people can cheat; they cheat just by a little bit.

When we remind people about their morality, they cheat less.

When we get bigger distance from cheating - from the object of money, for example - people cheat more.

And when we see things of cheating around us, particularly if it's a part of our in- group, cheating goes up.

http://www.npr.org/templates/transcript/transcript.php?storyId=150818706

(Not just Ten Commandments Alan--the economics of the brain's cheating behavior.)

Gelles  02/07/2013 10:09 AM Report

1.The Alan Blinder analysis does NOT simplify the relationship between Buyers and Sellers:

..... Buyers and Sellers must be able to both MAKE and AFFORD the goods and services each sells to the other.

2. Economics as a SYSTEM requires producers and consumers to close the EXCHANGE loop. Together, they must MAKE goods and PERFORM services -- and -- PAY for what is made, performed and exchanged.

3. REMant and Blinder have not admitted that MONEY is KEY to the PAYMENT function.

4. REMant resorts to meaningless proverb, "There is no free lunch of the sort that makes a Keynesian true believer like Blinder." Both are true believers in the existing NON-SYSTEMATIC approach to Demand and Supply that allows this recovery from fraud and abuse of the credit system to take years instead of days.

5. The crucial function is PRODUCTION. Produce the weapons in WW II. Produce the green energy, cleaned-up water, air and upper atmosphere, food, shelter, care, education, training, recreation, and surplus of all for retired producers, TODAY.

6. Cover all supply with monetized demand to complete the required LOOP. If your do not understand Keynes and functional finance, you are a useless bore.

SharkswithfrikingLazers  02/07/2013 03:00 AM Report

Jail?—yes says Alan, but the burden of proof is a high bar.

700 to 900 went to jail during the Savings and Loans crisis (a low bar then?).

Oh the good ol' days.

We have gotten stupid; they have gotten smart.

SharkswithfrikingLazers  02/07/2013 02:53 AM Report

1) Thou shall remember that people forget. One of the rules of financial bubbles is that people forget that the good times won’t roll forever—especially with houses.

(No kidding Alan, was it forgetting or was it regulators who are bought off via the industry/government revolving door resulting in deception instead of "loss of memory".)

2) Thou shall not rely on self regulation. Alan Greenspan expressed shock that banks let their risk management systems deteriorate as much as they did.

(WOW, really? Do not trust human nature (but value human worth). How do these guys get paid the big money Charlie?)

3) Thou shall honor thy shareholders. Board of Directors let a lot of things happen in this crisis.

They did not ask the hard questions (Charlie says perhaps they did not know, too complex an issue.)

(WHAT? Doesn't anyone listen to Warren Buffet? He does nothing unless he understands it and asks the tough questions. Shareholders have sued their Boards and many more should follow suit.)

4) Thou shall elevate the importance of risk management. This got out of control. Fancy mathematical models--in many cases it was a charade.

(Charade or FRAUD?!)

5) Thou shall use less leverage. Over leverage was the KEY THING IN THIS CRISIS TO MAKE IT ALL BLOW. Households, Banks, Investment Banks leveraged 40 to 1 so a 2.5% diminution of your assets and you are bankrupt.

(There are regulations for this too or at least there were until our politicians-turned-bankers got into the cookie jar.)

6) Thou shall Keep It Simple Stupid. Crazy securities. Built on sub-prime mortgages $200B base built to trillions. A CRAZY QUILT.

(Transparency? Apparently you do not understand about the Emperor's new clothes. It is a crazy quilt that cannot see the light of day.)

7) Thou shall standardized derivatives and trade them on organized exchanges. Credit Default Swaps were customized so you can’t comparison shop nor trade easily.

(Indeed and "Frontline" covered this very well.)

8) Thou shalt keep things on the balance sheet. Banks and Investment Banks hived to Structured Investment Vehicles. Like Enron. We did not learn.

(This is a crime. HELLO?! Enron people are in prison.)

9) Thou shall fix perverse compensation systems. Traders had incentive systems that rewarded the upside with hundreds of thousands of dollars but only a slap on the wrist on the downside. So go for broke--what is there to lose.

(So common sense was at a premium? This must mean greed was not just a deadly sin but a God.)

10) Thou shall watch out for ordinary consumer citizens. Duping them into contracts like subprime mortgages which threatened families and the entire economy.

(My local bank offered patrons the option to make up their own mortgage rate and term. Hey, do whatever you want. Money was blowing around like wind before a hurricane.)

Thank you for the Ten Commandments Alan. Sorry they have to be broken because of the golden calf.

anne4444  02/07/2013 02:14 AM Report

Excessive competition in the capitalized system made us all like Gladiators. Wish... we can be all free:

http://www.youtube.com/watch?v=xButjfhZWVU

SharkswithfrikingLazers  02/07/2013 01:58 AM Report

Charlie, you say you want to run through 10 financial commandments and they will put them on the screen.

Sorry, never made it to my screen.

SharkswithfrikingLazers  02/07/2013 01:54 AM Report

Great question Charlie, why do we need another book about the financial crisis?

He says he needs to tell the whole the story.

Nope, he needs to present evidence from his research for indictments.

SharkswithfrikingLazers  02/07/2013 01:50 AM Report

The Oscar-winning documentary "Inside Job" — raised questions about the role of economists in almost crashing the entire world economy.

Epstein circulated a petition — signed by about 300 economists — calling on the American Economic Association (AEA) to establish a code of conduct requiring that economists who work on the side for financial firms disclose these potential conflicts of interest.

That follows a study he and a graduate student completed last year showing that some high-profile economists don’t reveal that they’re paid by financial firms when commenting in academic ­literature, government testimony, and the media. In response to Epstein’s efforts, the AEA created a committee to explore its disclosure standards.

http://paw.princeton.edu/issues/2011/04/06/a-moment-with/

Indeed Alan, we hope you have cleaned up your own profession.

tabs  02/06/2013 10:21 PM Report

On September 5, 2012 Mario Draghi MD turned on the Morphine Drip of UNLIMITED bond purchases of European debt by the ECB. On September 13, 2012 Ben Bernanke MD concured and followed suit by turning on the Morphine Drip of UNLIMITED bond purchases of United States debt (aka QE3 which is composed of, 45B USD a month of Bonds, 40B a month of Mortgage backed securites until a 6.5% unemployment rate is achieved).

These actions taken by both the European and US Central Banks have lessened uncertainity and thus risk which have given investors a green light to invest money in Equities which here to fore had either been in US Treasuries or sidelined in cash equivalents as the risk coeficient had been too high to invest in Equities. Thus the SP 500 index which was roughly at 1405 on September 5, 2012 has risen to roughly 1512 on February 6, 2013. This basic scenario will continue as long as investors have no other viable alternative which will create a real ROI and or will pass on inflationary forces that a dilution of currencies brings about.

The "unlimited" nature of both the European and US purchasing of government debt instruments is an admission that previous short termed QE programs were a failure in reviving moribund economies and that the economies without the stimulative nature of incresing the money supply would contract. However by endlessly printing money to purchase these debt instuments both the European Union and United States are diluting the value of their currencies. Since the world is a finite place there is only so much perceived value to currencies and as such at some point in time the curriencies will have no value. Thus the Draghi and Bernanke diagnosis in September of 2012 was that the European and US economies are ultimately terminal, with termination coming via a currency collapse. On January 19, 2013 the GAO concured with the Draghi/Bernanke diagnosis in that they stated that "the long term fiscal path sic of the US is UNSUSTAINABLE." Which in anyother parlance means terminal.

charliesheep  02/06/2013 01:19 PM Report

THOSE; WHO WOULD SELL THEIR "GOODS" ARE PURVEYORS OF ; "LOOK OVER THERE"; WHILE I TAKE THE CREDIT FOR ALL; I.E. WHILST STANDING IN THE SHOES OF THOSE, WHO DID! THE WORLD; HAS NO "SAVIOR" OTHER THAN THE "REAL" ONE AND HE; HAS HIS PRICE! COLLISIONS OF[35 YEARS OF] GREED -FOOLS AND FALLING WAGES AGAINST G.D.P. THE "OLD"AMERICA THAT HAS LIVED ON BORROWED INCOME, COMES HOME; THEY HAVE BECOME "THIRD" WORLD OR LESS THAN "CAN PICKERS" BUYING BEER, CIGARETTES, AND BEEF JERKY! -EDUCATION -IS "ACRONYM" FOR -CHUMPS ARE GONNA DO WHAT THEIR GONNA DO! BUT, PLEASE, BUY MY BOOK WHILE YOUR STAY CONTINUES ON THE MARGINS! ENTITLEMENTS ARE STOLEN; BY BANKS [COMISSIONS] FINANCIERS[ENTERPRISE]GOVENMENTS, WELL INTENDED "SOCIAL CONTROLS"[MONEY]--AFTER THE FACT [FALL] OF ECONOMY] THE; "I TOLD YOU SO'S" ARE LEGION BUT, IN TIME "YOUR" PURSE SHOULD BE "YOUR" DOMAIN AND NO BOOK IS NEEDED FOR THAT!

Leila  02/06/2013 12:52 PM Report

Really enjoyed this interview. A very reason and rational

person. Learned a lot as well.

REMant  02/06/2013 11:27 AM Report

Demand has and has had nothing whatever to do with this, except negatively, because you cannot run an economy on promises alone. Sure ppl need to be able to afford what they make, but they also need to make what they buy. There is no free lunch of the sort that makes a Keynesian true believer like Blinder.

Housing is now commencing another bubble, with more starts than buyers, as is the stock mkt, whose precipitous ascent can only mean there's more money (credit) than good places to invest it. And we have a situation similar to 2007 in the student loan market.

Ppl STILL cannot comprehend that when the stock mkt as a whole goes up, it means there's too much money chasing too little return, the result of printing more money on the one hand, and a decline in investment and production, on the other. It signals competition, not advance.

And it means the Fed's program is not working. Instead of working for our livings, we're blaming others for working too much and not giving us our fair share. There's no way to develop a country without saving. Printing money ends in taking it not just from those who've saved, but from those made poor by the ensuing disparity in wealth and income. And all this despite the fact that this process has been clearly described since at least the 1870s. Certainly the housing bubble was just as apparent in the late 1920s.

Those financial institutions should never have been rescued at the general expense. The only money we're getting back is depreciated (and how even a Keynesian can believe otherwise is beyond me). The only uncertainty in business, as I've said for four yrs, is whether we're going to continue to play this inflation game, or whether they are going to actually have to produce something.

The president, himself, at the beginning said Americans had to stop living off the appreciation in real estate, but this evaporated by the 2009 State of the Union,* which in fact is where he explained why the banks had to be saved, a statement I'm sure was written by Geithner, Summers, Bernanke, and co. Indeed, I can't even find the quote online anymore and am beginning to wonder if it was an ad-lib later expunged so it couldn't be held against him. Nevertheless, the general idea had permeated the Inaugural Address just a few weeks earlier.

The IRS. I understand, has estimated a typical family of four will have to pay nearly half its income by 2016 for the least expensive Obamacare plan. Like Medicare, it will make more sense to pay the penalty.

These Keynesians have their counterpart in politicos who believe in "progress," and that the country has a "living" constitution. Reversals just don't register. So, despite his position on the Volcker rule, and epiphany concerning real estate reminiscent of Greenspan's and Bernanke's, or the fact that he apparently wrote this book in an attempt to clear up things in his own mind, IMHO he's as blind as ever. Depressions are caused by welfare. You can't run economies that way. (Great frameshot, BTW)

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*"You see, the flow of credit is the lifeblood of our economy. The ability to get a loan is how you finance the purchase of everything from a home to a car to a college education; how stores stock their shelves, farms buy equipment, and businesses make payroll.

"But credit has stopped flowing the way it should. Too many bad loans from the housing crisis have made their way onto the books of too many banks. With so much debt and so little confidence, these banks are now fearful of lending out any more money to households, to businesses, or to each other. When there is no lending, families can't afford to buy homes or cars. So businesses are forced to make layoffs. Our economy suffers even more, and credit dries up even further.

"That is why this administration is moving swiftly and aggressively to break this destructive cycle, restore confidence, and re-start lending....

"That's what this is about. It's not about helping banks - it's about helping people. Because when credit is available again, that young family can finally buy a new home. And then some company will hire workers to build it. And then those workers will have money to spend, and if they can get a loan too, maybe they'll finally buy that car, or open their own business. Investors will return to the market, and American families will see their retirement secured once more. Slowly, but surely, confidence will return, and our economy will recover."