Columbine Bankers
By John Batchelor on April 19, 2009 at 12:50 PM in Current Affairs, Hank Paulson, Tim Geithner, Wall Street
Editor’s Note: DON’T MISS LARRY JOHNSON TONIGHT on the Batchelor show at 10:30 p.m. ET, via KFI 640 AM. Check out the full slate of guests and topics tonight.)
Ten Years After The Massacre. 
,” a comprehensive review of the mass murder of children by two sick people ten years ago, April 20, 1999, I was stumped and then gripped by the brief chapter on “Psychopath.” I read this paragraph with a fresh chill.
“Researchers are just beginning to understand psychopaths, but they believe psychopaths crave the emotional responses they lack. They are nearly always thrill seekers. They love roller coasters and hang gliding, and they seek out high-anxiety occupations, like ER tech, bond trader, or Marine. Crime, danger, impoverishment, death — any sort of risk will help. The chase new sources of excitement because it is so difficult for them to sustain.” Did you notice? ”Bond trader.”
And then I put this up against what I read daily about the grotesque risk the big banks and attendant shadow banks sought out and took during the well-known housing bubble of 2002-2008. AIG’s counterparty bets with CDS is astonishing until you consider there may have been a psychopathology to the behavior. The risk was the desire, not the money. All the major banks took part in similar fashion. Where was the adult supervision? Anger management? Were the traders psychopaths? No. But perhaps a few, more than a few, and perhaps that behavior was acceptable to the sane. Or perhaps the psychopaths were very good at disguising their rage and compulsive, reptile-brain risk-taking.
Another stunning paragraph from the “Psychopath” chapter: “Psychopaths are distinguished by two characteristics. The first is a ruthless disregard for others: they will defraud, maim, or kill for the most trivial personal gain. The second is an astonishing gift for disguising the first. It’s the deception that makes them so dangerous. You never see him coming. (It’s usually a him– more than 80 percent are male.) Don’t look for the oddball creeping you out. Psychopaths don’t act like Hannibal Lecter or Norman Bates. They come off like Hugh Grant, in his most adorable role.” Does this sound too much like Jamie Dimon, Tim Geithner, Vikram Pandit, even Lloyd Blankfein? Is the big banking culture a nest of Eric Harris and Dylan Klebold types? Impossible! Are they thrill seekers? Why are their banks either insolvent or fashioned with an architecture of opacity? Will JP Morgan Chase, Citigroup and Goldman Sachs pass the stress tests due Monday May 4? You ask?
As encapsulated by a savvy poster at Calculated Risk, Stiglitz just sees more Federal foolishness:
Joseph Stiglitz on Bloomberg
Stiglitz Says White House Ties to Wall Street Doom Bank Rescue
A sample of quotes
“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”
“We don’t have enough money, they don’t want to go back to Congress, and they don’t want to do it in an open way and they don’t want to get control” of the banks, a set of constraints that will guarantee failure, Stiglitz said.
Relying on low interest rates to help put a floor under housing prices is a variation on the policies that created the housing bubble in the first place, Stiglitz said.
“This is a strategy trying to recreate that bubble,” he said. “That’s not likely to provide a long run solution. It’s a solution that says let’s kick the can down the road a little bit.”
While the strategy might put a floor under housing prices, it won’t do anything to speed the recovery, he said. “It’s a recipe for Japanese-style malaise.”
So I thought I would take a drive down memory lane here and see what is new.
The crisis grinds on, in a most boring fashion, now beginning to smell just like the S&L crisis except that houses are also massively involved.
Did everybody like my bottom calls? Kinda looks like the double bottom might hold now throughout the summer.
In other words, the worst of this crisis is past- the next is several years away, meanwhile all of the wreckage of the last one heaves into view and the punditocracy grinds away at the reality of it.
The best was watching all of the deluded folks from my office yesterday as they paraded with their teabags.
Pining for stuff that was gone before they were born.
How’s everyone enjoying that Velvet Fist of Government?
The system was saved, sort of, kind of, but not to be anywhere near as good as it once was.
I told you Wall Street wouldn’t like what my colleagues in DC had in store for them- now they are positively miserable.
I do note that our Chinese friends are beginning their long run away from the dollar- a true so long and thanks for all the fish moment is still a long ways away.
So, enjoy the boredom, punctuated by moments of volatility that will faintly recall that magnificent fall- but those days have truly past. Now we sit and wait.
Someday this war’s gonna end…
, the basis for the Best Motion Picture Nominee (Golden Globes) starring Brad Pitt.
, the novel by John Le Carre, a new motion picture starring Gary Oldman and Colin Firth.
by 
* (Included in the 
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.by David Fredosso who wrote 2008's 
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