Comments on: AIG Gets Flak Over Bonuses, But Derivatives Bailouts Are Where The Big Money Is http://www.badidea.co.uk/2009/03/aig-gets-flak-over-bonuses-but-derivatives-bailouts-are-where-the-big-money-is/ Bad Idea is an invaluable source of information and quality journalism about cultural and economic innovation in Britain and beyond. Thu, 09 Feb 2012 01:28:36 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Thomas Sullivan http://www.badidea.co.uk/2009/03/aig-gets-flak-over-bonuses-but-derivatives-bailouts-are-where-the-big-money-is/comment-page-1/#comment-2487 Thomas Sullivan Thu, 19 Mar 2009 18:57:39 +0000 http://www.badidea.co.uk/?p=5124#comment-2487 I dropped Accounting twice in college, so I'm right in line with AIG. Two things need to happen in my opinion: 1)The US and Europe need a review and approval body for new financial "instuments", something similar to the Food And Drug Administration. These jokers were allowed to create CDOs, SIVs etc out of thin air. What's next -- pooling library fines? 2)Issuers of critical loans (like mortgages)should be required to hold them for five years. The reason for all this mess was "packaging" and unloading loans to suckers that didn't understand them, which destroyed any incentive for lenders to follow solid lending practices. Has Cassano left his bachelor pad yet? I dropped Accounting twice in college, so I’m right in line with AIG. Two things need to happen in my opinion:

1)The US and Europe need a review and approval body for new financial “instuments”, something similar to the Food And Drug Administration. These jokers were allowed to create CDOs, SIVs etc out of thin air. What’s next — pooling library fines?

2)Issuers of critical loans (like mortgages)should be required to hold them for five years. The reason for all this mess was “packaging” and unloading loans to suckers that didn’t understand them, which destroyed any incentive for lenders to follow solid lending practices.

Has Cassano left his bachelor pad yet?

]]> By: Jilleroo2.0 http://www.badidea.co.uk/2009/03/aig-gets-flak-over-bonuses-but-derivatives-bailouts-are-where-the-big-money-is/comment-page-1/#comment-2484 Jilleroo2.0 Thu, 19 Mar 2009 15:01:37 +0000 http://www.badidea.co.uk/?p=5124#comment-2484 I think personally what's important is to somehow force executives to factor in the long term risk of total systemic collapse into the decisions they make. whether that be about maintaining proper capital ratios, or being disqualified from trading products whose worse case loss is too much for the banks to handle... I think personally what’s important is to somehow force executives to factor in the long term risk of total systemic collapse into the decisions they make. whether that be about maintaining proper capital ratios, or being disqualified from trading products whose worse case loss is too much for the banks to handle…

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