5. March, 2003 - Ash Wednesday

• Hey, it’s Ash Wednesday already. And I almost completely missed Fat Tuesday. Then again, with the goofy sleep schedule I’ve had lately, I’m surprised I even know what day it is. I started correcting things last night by managing to stay up until 10pm, almost four hours past when I was tired and felt like going to bed. The only real alternative was to wrap around the other direction, and I didn’t feel up to that.
• I’ve gotten back to adding to the Geography section of the site, adding The West Bank and a couple others to the list. I'm slowly filling in the blanks.
• Hard Times at City Hall in Minneapolis. Basically what the city’s done is rack up a ton of debt over the past ten years or so, and now with a drop in income, the monthly payments have gotten unmanageable.
• Warren Buffet talks Avoiding a ‘Mega-Catastrophe’. He’s worried by the huge derivatives market and the domino effect that can bring down seemingly unrelated companies when one runs into trouble. I agree that there’s a problem, but (yeah, I’m about to argue with the Oracle of Omaha) I think Warren misses the mark on what the real problem is.
  
  There are two problems that make derivatives dangerous. The first is a lack of information—the current highly-regulated financial markets require disclosure, but the GAAP leave so much room for obfuscation that figuring out an annual report is beyond most people. I think this is a problem that can be solved.
  
  The second problem is a lack of (personal) responsibility. Given the current law in America, corporations have the same rights as individuals, but lack the responsibility for their actions that individuals have. The lack of balance between rights and responsibilities for corporations makes them easy (and profitable) to abuse, and derivatives are a symptom of that imbalance. Correcting the problems with derivatives would mean addressing this imbalance. Don’t hold your breath waiting for that reform. It wouldn’t be good for business. [some guy]

Copyright 2008, Dave Polaschek. Last updated on Wed, 05 Mar 2003 07:48:36.