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Everyone Hates Harvard
theodp writes: Hedge fund manager John Paulson personally took home nearly $4 billion in 2007 after convincing banks to create securities of sub-prime mortgages he could bet against. Now Harvard, which originally passed on an opportunity to join alum Paulson in his big bet, is also reaping the rewards of the nation's financial crisis as it renames its engineering school the "Harvard John A. Paulson School of Engineering and Applied Sciences" after receiving a staggering $400 million donation from Paulson, the largest gift in the university's history. Quartz argues that Paulson's $400 million Harvard donation just reinforces inequality. Author Malcolm Gladwell took to Twitter to voice his distaste (sampling: 1. "It came down to helping the poor or giving the world's richest university $400 mil it doesn't need. Wise choice John!" 2. "If billionaires don't step up, Harvard will soon be down to its last $30 billion." 3. "It's going to be named the John Paulson School of Financial Engineering.") And, in Everyone Hates Harvard, Philip Greenspun notes that even WSJ readers reacted with vitriol to the news. "I would have thought that Paulson would be a hero to market-following WSJ readers," remarks Greenspun, "not a villain."
Why isn't this guy in jail yet?
Those who do not learn from commit history are doomed to regress it.
convincing banks to create securities of sub-prime mortgages he could bet against
The article does not say that he did that. Instead, the article says that the banks bought insurance against mortgage defaults (credit default swaps), and that prices of such insurance was very low. John Paulson decided the price was too low compared to the risk, so he bought a lot of the same insurance. When the mortgages started defaulting and prices for insurance went up, he sold the insurance on to the banks at a profit.
If there had been a hundred John Paulsons out there, credit default swaps would have gone up in price much earlier, forcing the mortgage lenders to rein-in their subprime lending, thereby either defusing the crisis entirely or at least making it much less bad. Alas, there was only one, and he was good at not getting the word out, so not many copycats. John Paulson did everyone a service and should be rewarded, not punished. The people who lend out money to people who had no chance of paying back should be punished, not rewarded.
Anyway, I have not read other articles about him, so maybe he does deserve his apparently terrible reputation.
I am somewhat surprised that it has fallen to me to defend a 1%'er. This is not exactly my usual modus operandi.
Finally! A year of moderation! Ready for 2019?
Harvard is the place those mass-murdering politicians go. It doesn't turn them into it. They were on the road to it long before going there, and continued that path afterwards. It's just one of the steps in that career path.
Harvard (and the ivies in general) are not the places where the best students go. They are the places where the most spoiled, stuck up, rich little bastards who don't mind cheating and manipulating others to get ahead go to master their craft.
And if you take that bait, you're a sap.
The problem is that the banking system has been rigged in order to socialize risk. This guy exploited that fact, realized he made more money than an individual human being could possibly amuse himself with and decided to dispose of a big chunk of that were it might do a little good.
People are shouting "Harvard! Harvard! Harvard!" because they don't want you to think about the rigged banking system. They'd rather focus any anti-elitist backlash on intellectuals.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
Like the "mass murderer" who brought us universal healthcare, drastically improving and saving countless American's lives?
You're thinking of the wrong school. Mass murderers have daddy buy their way into being a C student at Yale.
I hate the useless spongers it creates.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
If you went to a Harvard, a Stanford, an MIT or a Texas A&M, and you happen to end up with more money than you know what to do with, you might be inclined to give a big pile of it to the university that got you started. And while that's a noble sentiment, you shouldn't. These places will continue turning out talented graduates no matter how much money you give them: you should give your money to a less-well-endowed institution, so that a larger number of students can get the same educational opportunity you had. Maybe your spouse went to a small liberal arts college. Maybe there's a place right down the road from your mansion that could use your help. But MIT and Stanford don't need your money, and they won't do much good with it.
A bit of data: Harvard's endowment amounts to $1.7 million per student. With a reasonable return on endowment investment, hey could quite literally abolish tuition forever if they wanted to. Just across the river is Boston University, a really excellent institution with a strong research focus and really great graduates, ranked #42 by US News. Its endowment per student is 1/25th of Harvard's.
Donating money toward improving education is a worthy goal, but don't get sentimental. Put the money where it'll do the most good for the most people.
(Full disclosure: I'm a professor at a liberal arts college whose endowment per student is mediocre at best.)
The issue with Harvard and the other Ive League schools it the pretension they they as individual are better then everyone else.
Granted getting into Harvard takes a lot of work, but there are a slew of smart people who could have gone but chose not to for a huge set of reasons.
But what these schools do well isn't their education, but the people you get in contact with will keep you in the network of successful people.
Now being around these people has its pluses and minuses. You pick up good skills however sometimes general comparison is loss from being in an environment of competing ambition.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Obama is just cleaning up Bush's mess, you know. And he did get Osama, and he's facing a much worse situation now (ISIS) that was largely caused by Bush's failures in the middle east.
And besides, the middle east is just beyond fucked, US interference or not. Stone age religious stupidity running rampant is impossible to fix. I honestly say let them destroy themselves in a holy war and the whole world will be better off for it.
Now I know where the wage gap comes from. It's growing from the excrement that Harvard shat out.
Its time for quality education to go to kids that deserve it.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
No one starts with a clean slate. Every president inherits problems. That's the job they begged and pleaded for. Blaming the previous president after 7 years is BS.
Its funny how muricans always blame their president for problems like these yet its the people of murica with their insatiable greed of consumerism that pretty much caused Bush and Obama to make sure their foreign interests are protected.
Caused another country to collapse?
Were you alive in September 2008? Because Bush made a pretty good start at forcing this one to collapse.
Iraq and Syria wer both his poor decisions catching up to us. It isn't Obama's fault that Bush fucked up in '06 and decided Maliki would be a great prime Minister. The man started wars t5hat killed hundreds of thousands of people in the Meddle East without managing to kill the one guy we were going for (Osama) This is Carter or LBJ-league in terms of foreign policy. Domestically he's Buchanan-league. His programs massively increased Federal spending (mostly by buying prescription drugs and paying for those wars), cut revenue, and the MBA fucked up financial regulation so badly that it's not an exaggeration to say that our economy did not survive his last four months in office.
Don't get me wrong. the man's a really nice guy, and apparently a wonderful father, and if a Pollster called me and asked me if I approved of him I'd almost certainly say yes. But objectively speaking his tenure was a disaster.
OTOH, Obama's solved the wars. He managed to kill that one guy we've been trying to knock off since Clinton. The economy is growing, and the deficit is shrinking. His major domestic policy accomplishment is working more or less as planned, despite the Obama Derangement Syndrome's insistence that some new data point nobody gives a shit about means that it's about to collapse on itself every six months. 10 years from now his "evolving" on gay marriage will be remembered as the brave stand that forced dead-enders to give up their Evil Opposition to the Civil Rights Issue of the Era.
No one starts with a clean slate. Every president inherits problems. That's the job they begged and pleaded for. Blaming the previous president after 7 years is BS.
Just crawl out from under a rock? We have present day politicians writing books blaming FDR for most everything. Or blaming Hoobert Heever for most everything. Only been a few years since eh?
Its not that I am all that wild about the present occupant, but it is pretty hard to blame him for firmly entrenching us in the eternal warfare practice of the middle east. Once you are in that club, you can check out any timer you like, but you can never leave. Presidency or party affiliation is irrelevent. Dubya and the neocons were hell bent on getting boots on the ground then, just as they are now.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
He didn't con an old lady out of her savings; he made a bet with banks and other investors who should have known better.
Not entirely correct. If he is the architect behind the subprime mortgages then he did not directly con an old lady out of her savings but his actions indirectly wiped half the value off those savings. He deliberately designed an extremely risky investment vehicle to look to the banks like a low risk, high return investment and they did not spot the trick. It might have been entirely legal but it bears all the hall marks of a con and in such a case, while the mark takes some blame for letting their greed overcome their common sense, the person who devised the con takes most of the blame.
But of course....he "inherited" the failures, but owns any "successes".
*yawn*
It's the whole "Success has many fathers, but failure is always an orphan" thing. But Obama being the narcissist that he is, many fathers = himself.
I'll be glad when the current clown show is over. The melt down of American foreign policy along with the rampant deficit spending has been breathtaking in its lack of foresight and heaping truckloads of incompetence. Jimmy Buffet singing to the French after Charlie Hebdo? Really?
Obama will still be blaming Bush when he's in his 90's and trips over his walker in the nursing home cafeteria.
Universal healthcare means everyone gets healthcare and it doesnt cost them anything. Obama didn't do that. He created a policy that was to force the states to fund health care and have the rich pay for the poor. That was rejected by almost half the states, So no we have no 'universal' healthcare. We have a tax if you don't have insurance.
Since Obama care, my coverage has gone up, my premiums have gone down, and the local hospital has reduced its prices. A local representative from the local hospital came to our work to explain coverage and premium changes because we get our insurance through the hospital network. They said since more people in general have insurance, there are fewer people going to the ER and more people scheduling proper doctor visits, which is driving down costs because the hospital is no longer having to eat the costs of poor people unable to pay a $1k ER bill, but can afford a $80 doctor's bill.
Posting anonymously b/c of mod points, but it sounds like he wasn't exactly a good guy. (My username is captnjohnny1618.)
http://www.deepcapture.com/201...
Yes, he did be against the overvaluation of the market. The shifty thing though is that he utilized resources that nearly 100% of people didn't have access to and ultimately designed a financial object that was certainly going to fail, ensuring a huge return on his investment. Instead of calling attention and trying to fix this major major problem that would have an effect not just on our economy and our people, but economies and people around the world, he decided to take advantage of it and make a huge amount of money at the expense of millions. (If he had done that, while at the same time making a huge amount of noise about the ways he saw the economy about to fail, this would be a different conversation).
A comparable situation in our field would be a computer person ("hacker") with significant inroads to some big chip maker (Intel let's say) identifies a weak point in the chip design exposing some hugely powerful zero day attack. He helps designs a complex "fix" that ultimately looks like it will solve the issue, yet doesn't even come close, and starts selling that to the chip company for a few millions of dollars. The complexity of it helps to obscure (for a spell) the reality that it is actually a worthless patch, and he has maintained enough separation from the issue to deny at least some of the responsibility. Selling this makes a lot of money for a lot of people, but this guys waits a little longer to cash in for himself.
Where it really gets shifty is that this guy knows that the fix is going to fail and it's only a matter of time, so he starts betting on the fix failing (in reality, he starts "hedging" on it, which is complicated and I don't understand all of its intricacies). Lots of it. So when the fix fails, as he knew it would and maybe even planned it to, he gets to cash in, and look like one of the smart ones who saw it coming.
In reality he saw it coming because he had a big hand in creating it.
Now in IT/CS/etc. we call that guy a huge dick for not telling the rest of the world about the problem and letting the free software community try and come up with a fix. If he had even remotely tried to peddle his BS fix, it would've been noticed and obvious, and people would accuse him of attempted fraud. If he tried to somehow pretend like he didn't have a responsibility to tell everyone, politicians and lawyers would be all over him with some trumped up charges that feign social responsibility, when it reality are just trying to recover the money this guy took from them. This guy just doesn't have to put up with that shit because all of those politicians and lawyers are his buddies and probably walked away pretty ok from all of this while the rest of us have to sit around and pick up the pieces.
TL;DR: You didn't have some great insight into the problem if you win by betting on a fixed fight where you knew the outcome... and helped set up the fight... and helped invent boxing.
You're living in the tyranny of your own ignorance, that's worse you sad old fuck.
While you might not have directly gone to a clinic in 45 years, you definitely have benefited from good healthcare services. Notice how the US doesn't have polio, ebola, or any other epidemic? You're welcome. Now you can also get some meds for the delusions of tyranny.