I suppose it’s always good for people to learn how the stock market works. Kevin Roose has a look at the exchanges, and a recent effort to manipulate the markets.
• There are two playable stock exchanges inside GTA V: LCN and BAWSAQ. On each of these exchanges, you can buy and sell stocks using the virtual cash you amass during the course of the game. (This cash has no real-world value, but it can be used to buy houses, airplane hangars, and other cool things inside the game.)
• Most of the time, these stock prices appear to move randomly. But in certain missions, your character is given a tip that, due to an in-game event (usually, an assassination of a CEO), a company’s stock is about to rise or fall precipitously. When this happens, you’re supposed to load up on the stock (or its competitor’s stock), kill the CEO, then profit from your trades.
• Rockstar Games, the makers of GTA V, have hinted (but never confirmed) that BAWSAQ, the second exchange, might be dynamic — in other words, it might move in response to the actions of other GTA V players, whose trades feed into a central online database. If thousands of players around the world happen to buy a bunch of guns simultaneously, the theory went, the BAWSAQ might reflect that activity by raising the price of Ammu-Nation stock (Ammu-Nation being the store where guns are purchased).
• There is no penalty for insider trading or securities fraud in Grand Theft Auto.
This article is really long. Interesting long, but it does say the same things over and over again (in a good way I swear). Basically, the big banks did not learn their lesson in 2008 and the accounting at big banks is as bad as ever. They’re still taking giant risks and smart investors don’t trust them anymore.
That’s an increasingly widespread view among the most sophisticated leaders in investing circles. Paul Singer, who runs the influential investment fund Elliott Associates, wrote to his partners this summer, “There is no major financial institution today whose financial statements provide a meaningful clue” about its risks. Arthur Levitt, the former chairman of the SEC, lamented to us in November that none of the post-2008 remedies has “significantly diminished the likelihood of financial crises.” In a recent conversation, a prominent former regulator expressed concerns about the hidden risks that banks might still be carrying, comparing the big banks to Enron.
A recent survey by Barclays Capital found that more than half of institutional investors did not trust how banks measure the riskiness of their assets. When hedge-fund managers were asked how trustworthy they find “risk weightings”—the numbers that banks use to calculate how much capital they should set aside as a safety cushion in case of a business downturn—about 60 percent of those managers answered 1 or 2 on a five-point scale, with 1 being “not trustworthy at all.” None of them gave banks a 5.
A disturbing number of former bankers have recently declared that the banking industry is broken (this newfound clarity typically follows their passage from financial titan to rich retiree). Herbert Allison, the ex-president of Merrill Lynch and former head of the Obama administration’s Troubled Asset Relief Program, wrote a scathing e-book about the failures of the large banks, stopping just short of labeling them all vampire squids. A parade of former high-ranking executives has called for bank breakups, tighter regulation, or a return to the Depression-era Glass-Steagall law, which separated commercial banking from investment banking. Among them: Philip Purcell (ex-CEO of Morgan Stanley Dean Witter), Sallie Krawcheck (ex-CFO of Citigroup), David Komansky (ex-CEO of Merrill Lynch), and John Reed (former coâ€‘CEO of Citigroup). Sandy Weill, another ex-CEO of Citigroup, who built a career on financial megamergers, did a stunning about-face this summer, advising, with breathtaking chutzpah, that the banks should now be broken up.
Jon Ronson went out and profiled 5 people who have an income separated by a multiple of about 5. He spoke with someone making $200 a week, $900 a week, $5K a week, $25K a week, $125K a week, and $625K a week. Surprisingly, only the person making $625K a week was angry about the politics surrounding income inequality. Worth a read. The person making $125K a week thinks more needs to be done.
There’s something unusual about Nick. For a multimillionaire, he doesn’t have your average multimillionaire view. In fact, he’s come to believe that the system he benefits so richly from is built on nonsenseâ€”specifically, the idea that “the markets are perfectly efflcient and allocate benefits and burdens perfectly efflciently, based on talent and merit. So by that definition, the rich deserve to be rich and the poor deserve to be poor. We believe this because we have an almost insanely powerful need to self-justify.”
When applying to become a shipping warehouse employee, Mac McClelland was concerned her background as a journalist might be an issue. Instead they only cared that she’d never been in prison and that she’d be on time.
There is no room for inefficiencies. The gal conducting our training reminds us again that we cannot miss any days our first week. There are NO exceptions to this policy. She says to take Brian, for example, who’s here with us in training today. Brian already went through this training, but then during his first week his lady had a baby, so he missed a day and he had to be fired. Having to start the application process over could cost a brand-new dad like Brian a couple of weeks’ worth of work and pay. Okay? Everybody turn around and look at Brian. Welcome back, Brian. Don’t end up like Brian.
In a sign of how long I keep tabs open in my browser, this article about How Republicans are being taught to talk about Occupy Wall Street is from 12/1/11. Frank Luntz, a Republican operative partly for responsible for the success of GOP messaging over the last several years, had a session at a Republican Governors Association meeting and gave a list of 10 dos and don’ts on how to talk about Occupy Wall Street.
6. Don’t ever say you’re willing to ‘compromise.’
“If you talk about ‘compromise,’ they’ll say you’re selling out. Your side doesn’t want you to ‘compromise.’ What you use in that to replace it with is ‘cooperation.’ It means the same thing. But cooperation means you stick to your principles but still get the job done. Compromise says that you’re selling out those principles.”
Republicans in the Senate are refusing to extend a payroll tax holiday that would be paid for with a small surcharge on incomes over $1 million. Their excuse is that it will hurt job creators. NPR asked to speak to some of these job creators who would stop hiring if their marginal income tax rate was raised.
The Boston Globe posted this picture of Mitt Romney so I made this macro, and few others. I don’t think this picture is going to bother anyone inclined to vote for him anyway, but I think everyone else is going to make fun of it.
Michael Lewis’s latest chapter length depresso is about California and how many of the cities there are pretty royally fucked because of pension promises that will begin to come due very soon, and in some cases have already begun to cause problems. One thing I learned, the states won’t ever have to bust their budgets because they can force more and more costs on to the cities. (I guess counties can do this, too, because this is exactly what happened in Topeka yesterday, where the city council voted to decriminalize domestic battery in order to force the county district attorney to start trying these cases again. He stopped last month citing budget concerns.) Anyway, we’re screwed, so here’s Lewis talking about a bike ride he took with Schwarzenegger.
He hauls a bike off the back of the car, hops on, and takes off down an already busy Ocean Avenue. He wears no bike helmet, runs red lights, and rips past do not enter signs without seeming to notice them and up one-way streets the wrong way. When he wants to cross three lanes of fast traffic he doesnâ€™t so much as glance over his shoulder but just sticks out his hand and follows it, assuming that whatever is behind him will stop. His bike has at least 10 speeds, but he has just 2: zero and pedaling as fast as he can. Inside half a mile heâ€™s moving fast enough that wind-induced tears course down his cheeks.
Heâ€™s got to be one of the worldâ€™s most recognizable people, but he doesnâ€™t appear to worry that anyone will recognize him, and no one does. It may be that people who get out of bed at dawn to jog and Rollerblade and racewalk are too interested in what they are doing to break their trance. Or it may be that heâ€™s taking them by surprise. He has no entourage, not even a bodyguard. His former economic adviser, David Crane, and his media adviser, Adam Mendelsohn, who came along for the ride just because it sounded fun, are now somewhere far behind him. Anyone paying attention would think, That guy might look like Arnold, but it canâ€™t possibly be Arnold, because Arnold would never be out alone on a bike at seven in the morning, trying to commit suicide. It isnâ€™t until he is forced to stop at a red light that he makes meaningful contact with the public. A woman pushing a baby stroller and talking on a cell phone crosses the street right in front of him and does a double take. â€œOh . . . my . . . God,â€ she gasps into her phone. â€œItâ€™s Bill Clinton!â€ Sheâ€™s not 10 feet away, but she keeps talking to the phone, as if the man were unreal. â€œIâ€™m here with Bill Clinton.â€
As a bonus, here’s a profile of Lewis from NY Mag.
The Federal Reserve Bank of Boston is right next to the #occupyboston campground. This was taken from the 23rd floor of the Fed’s office. There’s something to the fact the picture was taken from high above in the Fed, right? It’s symbolic of something…
(via @timlanning and @BostonTweet)
Michael Lewis is finally writing a screenplay for Liar’s Poker. Finally. I’ve only been clamoring for it for two and a half years. “John Requa and Glenn Ficarra of Crazy, Stupid, Love will direct“. Liar’s Poker tells the story of Lewis’ time as a bond salesman at Salomon Brothers, the firm that pretty much created mortgage bonds. The leveraging of which, you might remember, were at least partly responsible for our current economic troubles. Why wasn’t this movie made 2 years ago?
I went through my archives to see how many times I talked about them making this movie. 9 times. 9 times since February, 2009 I’ve wondered why the movie hadn’t been made. 1, 2, 3, 4, 5, 6, 7, 8, 9. Now what am I going to write about?