As a PhD student:
As a post-doc:
As a professor:
via:
[ed. See also: We are pleased to inform you that your paper has been accepted!]
The story of the New York apartment is a tale of need alchemized into virtue. Over and over, the desire for better, cheaper housing has become an instrument of urban destiny. When we were running out of land, developers built up. When we couldn’t climb any more stairs, inventors refined the elevator. When we needed much more room, planners raised herds of towers. And when tall buildings obscured our views, engineers took us higher still.
At the time I made the Silicon Valley comparison, I did not expect to be served actual silicone.The National Government [is] pushing a Cyprus-style solution to bank failure in New Zealand which will see small depositors lose some of their savings to fund big bank bailouts . . . .
Open Bank Resolution (OBR) is Finance Minister Bill English’s favoured option dealing with a major bank failure. If a bank fails under OBR, all depositors will have their savings reduced overnight to fund the bank’s bail out.
An efficient path for returning the sound operations of the G-SIFI to the private sector would be provided by exchanging or converting a sufficient amount of the unsecured debt from the original creditors of the failed company [meaning the depositors] into equity [or stock]. In the U.S., the new equitywould become capital in one or more newly formed operating entities. In the U.K., the same approach could be used, or the equity could be used to recapitalize the failing financial company itself—thus, the highest layer of surviving bailed-in creditors would become the owners of the resolved firm. In either country, the new equity holders would take on the corresponding risk of being shareholders in a financial institution.No exception is indicated for “insured deposits” in the U.S., meaning those under $250,000, the deposits we thought were protected by FDIC insurance. This can hardly be an oversight, since it is the FDIC that is issuing the directive. The FDIC is an insurance company funded by premiums paid by private banks. The directive is called a “resolution process,” defined elsewhere as a plan that “would be triggered in the event of the failure of an insurer . . . .” The only mention of “insured deposits” is in connection with existing UK legislation, which the FDIC-BOE directive goes on to say is inadequate, implying that it needs to be modified or overridden.
In the US, depositors have actually been put in a worse position than Cyprus deposit-holders, at least if they are at the big banks that play in the derivatives casino. The regulators have turned a blind eye as banks use their depositaries to fund derivatives exposures. And as bad as that is, the depositors, unlike their Cypriot confreres, aren’t even senior creditors. Remember Lehman? When the investment bank failed, unsecured creditors (and remember, depositors are unsecured creditors) got eight cents on the dollar. One big reason was that derivatives counterparties require collateral for any exposures, meaning they are secured creditors. The 2005 bankruptcy reforms made derivatives counterparties senior to unsecured lenders.One might wonder why the posting of collateral by a derivative counterparty, at some percentage of full exposure, makes the creditor “secured,” while the depositor who puts up 100 cents on the dollar is “unsecured.” But moving on – Smith writes:
Lehman had only two itty bitty banking subsidiaries, and to my knowledge, was not gathering retail deposits. But as readers may recall, Bank of America moved most of its derivatives from its Merrill Lynch operation [to] its depositary in late 2011.Its “depositary” is the arm of the bank that takes deposits; and at B of A, that means lots and lots of deposits. The deposits are now subject to being wiped out by a major derivatives loss. How bad could that be? Smith quotes Bloomberg:
. . . Bank of America’s holding company . . . held almost $75 trillion of derivatives at the end of June . . . .
What kind of happiness does technology procure then? And why do people remain both enthralled and unsatisfied by it? (Albert Borgmann, Technology and the Character of Contemporary Life)
To be a friend to many people in the complete kind of friendship is not possible (Aristotle ,Nicomachean Ethics, Book VIII)There is a nice moment in Desmond Morris’ documentary The Human Zoo where, as he ponders the means by which the human animal deals with dense urban living, he hoists his address book and declares: “This is his [the urban dweller’s] personal tribe!” No doubt if he were writing the documentary today he would make the same point by recourse to his Facebook page.
Facebook provides us a convenient mnemonic device for keeping track of family and acquaintances. More than this, of course, it offers the means to friendship itself. We can carry out a range of cordial tasks on Facebook: we can post, comment, like, poke (does this even exist anymore?), chat, re-share, or indeed, if we incline to do so, quietly monitor the lives of our friends.