And so the financial crisis continues...or not...depending on which side of the political fence you're on and whether you're a tax PAYER or a tax COLLECTOR.
Recently, I ran across an interesting theory for the crisis's origins. Though I can't remember where I encountered it or the theory's originator, it goes like this...
Time was when all the best and brightest college graduates headed for careers in medicine, law, engineering, teaching and the arts. And for generations the dumb guys (and gals) headed to Wall Street, with few aspirations beyond making piles of money, owning a house in Greenwich, another in the Hamptons, and golfing thrice weekly.
Over time though, math jockeys - the so-called 'quants' - discovered the piles of money to be made with esoteric models of risk and reward. And thus began the smart guy migration - away from useful professions where stuff gets made and knowledge created, toward feeding Wall Street's lust for outsize profits with opaque securities and incomprehensible trading strategies.
Securities and trading strategies SO opaque and incomprehensible that when the quants said they understood it all you just knew they were lying through their bleached teeth.
But like scary-smart locusts the quants swarmed Wall Street and found themselves reporting to...yes, you guessed it..the dumb guys!
Remember them?
By now they'd risen to positions of supervisory authority, the financial world's BSDs - "Big Swinging D**ks." To the BSDs, "supervision" meant leaving a bunch of snot-nosed twerps alone to make piles of math-fueled money. "Don't ask, don't tell" took on a whole new meaning. The BSDs didn't want to ask and wouldn't have understood the explanation if they had.
Smart guys reporting to dumb guys. See the problem? We've spent lots of energy debating compensation limits in financial services. Maybe, given that we're stuck with the supervisory status quo for a while longer, what we really need are IQ limits.
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