Archive for February, 2009|Monthly archive page

Yet another post on the credit crisis

In Money on February 23, 2009 at 00:52

billmon has written a not-so-simple take on what lead to the credit crisis.

I do not understand it all yet, but a longer list of assumptions made on the investment vehicles:

  1. Housing prices rarely go down, at least nationally.
  2. Default losses on large mortgage pools are not only low but relatively stable.
  3. People don’t walk away from their homes, even when they’re under water.
  4. Regional housing markets are largely uncorrelated.

This was one of the hard hitting lines from the article:

Thanks to the embedded leverage these “legacy” assets contain, a 20% (housing) price decline has resulted in 80% or 90% or even 100% losses on many of them.

Should read the article better when I get the time …


Yet-unGroked Post – I

In Uncategorized on February 16, 2009 at 04:53

Inspired by Random Things

  • Viability of Pacifism: “those who ‘abjure’ violence can only do so because others are committing violence on their behalf“. However, this is because I think humans have continuously been inflicting violence against each other since history has been recorded. Is this instinct of inflicting violence a basic part of human nature? The reasoning (Religion, Honour, Just, Good vs. Evil, etc.) provided for these actions are hypocritical to be considered seriously (Orwell calls this  “Indifference to Reality”). If it can be shown that such instincts is inescapable (through maybe studies of primates, etc. ), then I will have to accept Pacifism is untenable.
  • Self-esteem vs. Nationalism: How can we strike a balance between the amount of history of the home country can be taught so that a child feels important but yet does not end up as a nationalist? Should we just have “I am unique but still Not-Special” sessions? I feel this is important in more ways than is obvious. If a child is taught to compare between cultures and see that there is nothing “special” about one’s own background, maybe hero worship will also decrease. This will lead people to see what qualities made success out of people and they can then try and emulate it.