Talking stocks, trading, and investing in general

[djblisk]



If you don't mind me asking are these undergrad or graduate loans?  Mine are graduate and my rates are ridiculous.  A couple are 6.55% and the ones that were 7.55% were just paid off.  

I worked ****** off to pay off my graduate and undergrad loans. Some of them as high as 8%.

**** people who want a bail out.

 

[GreenFrog]

I'm fortunate enough to not have undergrad loans and I've gotta say that one of the biggest reasons as to why I don't want to pursue an MBA as much anymore is the debt I'd have to incur.

The thought of having that kind of debt is crippling and I'm finding the value of having an MBA is not as great, especially with the career track I want to pursue.

We shall see.

 

[Piobaire]

I know this is small change for you rollers but a nationalistic index ETF has paid off about 12% since February. EWC, a Canadian markets ETF has treated me well. Not sure how long I'll stay in but I'm there right now and happy.

 

[otc]

My loans are undergrad (and not private loans...all stafford/perkins). Some were up to 6.8 although I don't honestly think that is terrible. Not sure what they average out to post consolidation (the earliest ones were floaters and the rates basically fell to zero while later ones were fixed as high as 6.8)

 

[amerikajinda]



I know this is small change for you rollers but a nationalistic index ETF has paid off about 12% since February. EWC, a Canadian markets ETF has treated me well. Not sure how long I'll stay in but I'm there right now and happy.

I'd be very happy with 12% since February! I'm only up 2.14% since February 1st... :foo:

 

[SkinnyGoomba]



I know this is small change for you rollers but a nationalistic index ETF has paid off about 12% since February. EWC, a Canadian markets ETF has treated me well. Not sure how long I'll stay in but I'm there right now and happy.

Well done! I think you'll find that topping the charts for performance compared to pretty much anything else over the same time period. My results since January have been in a range if 8-10% and I'm very happy with that. Good luck in timing with M&A for the majority of the biggest gains.

 

[Piobaire]

Thanks, guys. Not sure about my exit strategy. There's much talk about increasing standards for mortgage underwriting in Canada and folks feel that will pop the housing market there.

 

[austinite]



My loans are undergrad (and not private loans...all stafford/perkins). Some were up to 6.8 although I don't honestly think that is terrible. Not sure what they average out to post consolidation (the earliest ones were floaters and the rates basically fell to zero while later ones were fixed as high as 6.8)

6.8% may not be terrible, but IMO it is still high enough that paying it off should be priority number #1 for you. A guaranteed 6.8% return is pretty damn good.

 

[Cantabrigian]



A lot of pundits and the like make it seem like there are scores of easy criminal cases to be made against CEO's. Most of those folks have no idea how difficult and complicated it is to actually establish a criminal (or even civil) fraud case through actual evidence in case like this. In some cases it's because no fraud (at least as the law defines it) was committed. In other cases, fraud probably was committed, but it's difficult or impossible to prove.


And yes, there's no shortage of ambitious prosecutors who would love to make their careers through such cases if they could.

Thoughts on this?

Why Only One Top Banker Went to Jail for the Financial Crisis


Argues that a big part of the reason that there weren't more prosecutions is that the DOJ has effectively lost that skill.

At any rate, I found the history fairly interesting.

 

[lawyerdad]



Thoughts on this?

Why Only One Top Banker Went to Jail for the Financial Crisis


Argues that a big part of the reason that there weren't more prosecutions is that the DOJ has effectively lost that skill.

At any rate, I found the history fairly interesting.

I only skimmed it, but I'd say that like many such op-ed pieces, there's a germ of truth stretched well beyond what's reasonable. That's sort of an inherent problem with this sort of journalism. "It's kind of a mix of stuff, and you can't really extrapolate a Grand Unified Theory or put all the blame in one place" makes for muddled reading. Having a focused theory and shaping the article, and the facts, around that theory yields a much more appealing product.

The DOJ has some phenomenal lawyers and some pedestrian ones. Because of the public scrutiny and politics of the situation, I think they assigned more phenomenal ones to these cases than pedestrian or inept ones. One small observation: the author faults the DOJ for "rushing to trial" in the Bear Sterns case. Yet, recent comments in this thread are illustrative of common frustration and criticism that the investigations and cases -- which often often hundreds of witnesses and terabytes and terabytes of data and documents -- are developed too slowly. That's not to say that either criticism is necessarily without merit. Some case are allowed to drag on too slowly, and others are rushed ahead for political reasons at the expense of preparation. But Monday morning quarterbacking is pretty rampant in the field.


In some ways, of course, the fact that the criticism isn't consistent reflects the complexity of issues surrounding these cases - not just the substance of the cases, but the judgment/prosecutorial discretion/resource allocation issues they raise. Should the DOJ be doing more "broken windows"-type enforcement in this area, prosecuting lower level Wall Street folks (who are often the ones with direct contact with investors, and thus the easiest ones to tag with fraud charges) to send a message? Or is that just punishing foot soldiers while letting the generals get off scot free? Wherever they draw the line, a lot of people are going to feel it should have been drawn elsewhere.


It's really, really hard to bring criminal case here. First, proving beyond a reasonable doubt what's in somebody's head (a requirement for fraud cases) is hard. Second, most of these entities are huge and complex, and information and decisions are distributed among thousands of people. The paper (electronic, really) trails are voluminous, confusing, and often ambiguous. It's super hard to conclusively put all of the necessary information and intent in a particular person's head (which you have to do even to win a case against the company, much less against a particular individual). And high-level management are surrounded by advisors, accountants, lawyers, and others who are weighing in on and papering pretty much every decision. Outside of buffoons like Chainsaw Al Dunlop or Dennis Kozlowski, pretty much every one of these execs will be able to point to advice from highly-qualified, highly-paid professionals saying that the actions they took were legal, permissible under GAAP, sufficiently risk-managed, etc. When that's the case, it's really hard to prove beyond a reasonable doubt that they were acting with deliberate fraudulent intent.

That's especially so because in most of these cases, there probably was not a forward-looking decision along the lines of, "let's figure out how to engage in a massive conspiracy to defraud retail investors." Rather, you get a combination of bad judgments made in good faith, strategies that are considered close to the line but potentially justifiable, and outright sleaziness operating at various levels. And as **** starts to hit the fan, awareness of how bad it is can sometimes spread unevenly through an organization or industry. You get people who have a sense of what's happening but put their head in the sand (or just cash out and run for the hills without making waves). You get people who probably should get it but are in denial. You get people who are just clueless. In the moment, it's a whole lot less clear than it is in retrospect.



I would also note that the author acts like the DOJ suddenly has gone from winning all the time to losing all the time. But he's working with very few (and cherry-picked) data points. I'm not sure I really see the trend that he does. Moreover, there's an argument to be made that losing some of these cases is not a sign of prosecutorial ineptitude, but rather a sign of aggressiveness. A lawyer or department that never loses a case is generally playing a cupcake schedule. Whether or not these particular cases should or should not have been brought is a lengthy discussion that we don't have sufficient information for. But more generally, I think it's a good thing when a prosecutorial office is aggressive in important areas such that it brings cases that, while grounded in good cause and a good faith belief in their righteousness, may nevertheless be difficult to win. If you're winning some and losing some, you're probably pretty much on the margin you want.


It would actually be interesting to me if this journalist or someone taking a similar tack would engage in a particular exercise: lay out in detail how they would presented a particular case they contend should have been brought or should have been won. They now have the benefit of hindsight. Point to what they would have relied on as their key evidence, and explain their theories on how it proves X or Y beyond a reasonable doubt. Then put that outline out there for people to discuss and vet. I'm pretty sure the reason nobody has done that is that saying a case is clear-cut is a lot easier than proving it.

In the context of this particular case, I see lots of pat conclusions about how the DOJ is inept, but not real analysis of what different tactics or steps a "non-inept" agency would have taken.

 

[crispeta]

Always believed that LNKD is a total sh*t show, but was convinced that other self-declared internet afficionados are dazzled by their metrics game. Restored faith in humanity comes at a price but that's ok.

 

[otc]



It's really, really hard to bring criminal case here. First, proving beyond a reasonable doubt what's in somebody's head (a requirement for fraud cases) is hard. Second, most of these entities are huge and complex, and information and decisions are distributed among thousands of people. The paper (electronic, really) trails are voluminous, confusing, and often ambiguous. It's super hard to conclusively put all of the necessary information and intent in a particular person's head (which you have to do even to win a case against the company, much less against a particular individual). And high-level management are surrounded by advisors, accountants, lawyers, and others who are weighing in on and papering pretty much every decision. Outside of buffoons like Chainsaw Al Dunlop or Dennis Kozlowski, pretty much every one of these execs will be able to point to advice from highly-qualified, highly-paid professionals saying that the actions they took were legal, permissible under GAAP, sufficiently risk-managed, etc. When that's the case, it's really hard to prove beyond a reasonable doubt that they were acting with deliberate fraudulent intent.

Boy have you got that right. That **** is hard enough to make heads or tails of when you've got the people who made it on your side. Imagine how much of a pain it would be to deal with that data if your only avenue towards clarifications and explanations is deposing a hostile witness from the adverse party.

Still though, seems kinda ****** that the only person to spend some time behind bars is a guy who was thrown under the bus by his own bank (and a non-american bank at that). *AND* he plead guilty so its not like they even had to try that hard to convict him. Considering CS turned him in...I am guessing they weren't paying his legal fees either?

 

[lawyerdad]



Boy have you got that right. That **** is hard enough to make heads or tails of when you've got the people who made it on your side. Imagine how much of a pain it would be to deal with that data if your only avenue towards clarifications and explanations is deposing a hostile witness from the adverse party.

Still though, seems kinda ****** that the only person to spend some time behind bars is a guy who was thrown under the bus by his own bank (and a non-american bank at that). *AND* he plead guilty so its not like they even had to try that hard to convict him. Considering CS turned him in...I am guessing they weren't paying his legal fees either?

I don't disagree it's ******. I have no doubt there are plenty more people who should go to prison. I was just commenting on the article and the reasons many people fail to appreciate how difficult those cases really are in most instances.

You can draw a various conclusions from the guilty plea. You're certainly right on a literal level that they didn't haven't to try that hard to convict him -- obviously, there was no trial. But often a guilty plea is a result of the fact that the government has done a good job putting together its case and the defendant knows he can't risk going to trial. (Not always, of course.)

I don't know about the particular case, but I'd guess you're right about attorney's fees. Different corporations have different policies, or relevant provisions in their governing documents and employment contracts. But if they turned him in, I agree it's a good guess that they weren't advancing fees.

 

[otc]

I'd say not wanting to risk a trial is probably highly correlated with whether or not your legal fees are covered.

Obviously I don't have any knowledge of the case (or I wouldn't be posting about it) but I can imagine what kind of kind of fees we would run up on something like that going all of the way to trial...and that would be small compared to all of the hours the lawyers would bill.

 

[lawyerdad]



I'd say not wanting to risk a trial is probably highly correlated with whether or not your legal fees are covered.

True. I mean, it's not 100% of course, but it's definitely a factor.