Money and Finance

The New Untouchables - By Thomas Friedman

Last summer I attended a talk by Michelle Rhee, the dynamic chancellor of public schools in Washington. Just before the session began, a man came up, introduced himself as Todd Martin and whispered to me that what Rhee was about to speak about — our struggling public schools — was actually a critical, but unspoken, reason for the Great Recession.

There’s something to that. While the subprime mortgage mess involved a huge ethical breakdown on Wall Street, it coincided with an education breakdown on Main Street — precisely when technology and open borders were enabling so many more people to compete with Americans for middle-class jobs.

In our subprime era, we thought we could have the American dream — a house and yard — with nothing down. This version of the American dream was delivered not by improving education, productivity and savings, but by Wall Street alchemy and borrowed money from Asia.

A year ago, it all exploded. Now that we are picking up the pieces, we need to understand that it is not only our financial system that needs a reboot and an upgrade, but also our public school system. Otherwise, the jobless recovery won’t be just a passing phase, but our future.

- Blind Faith By Steven Romick
Blind faith has gotten us into trouble repeatedly throughout history. Just consider the rogue’s gallery of false idols, dictators, and charlatans we have followed, hoping for something different, something better. That misplaced conviction corrupts...

- South Carolina’s Pension Push Into High-octane Investments
MANY mornings, the yellow Lamborghini would swing into view, sweep past tree-softened streets with a low, smooth rumble and throttle down outside an office near the State House downtown. Behind the wheel was a financier named Robert L. Borden. Around...

- Robert G. Wilmers' 2011 Letter To Shareholders
Thanks to Lincoln for pointing this out. Warren Buffett often recommends Wilmers’ letters (as well as Jamie Dimon’s). The letter is on pages 7-23 of the PDF linked to below, or there is an abridged version HERE. As relatively good a year 2011 was...

- Academic Bankruptcy - By Mark C. Taylor
WITH the academic year about to begin, colleges and universities, as well as students and their parents, are facing an unprecedented financial crisis. What we’ve seen with California’s distinguished state university system — huge cutbacks in spending...

- The Magnetar Trade: How One Hedge Fund Helped Keep The Bubble Going - By Jesse Eisinger And Jake Bernstein
In late 2005, the booming U.S. housing market seemed to be slowing. The Federal Reserve had begun raising interest rates. Subprime mortgage company shares were falling. Investors began to balk at buying complex mortgage securities. The housing bubble,...

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