Among other things, in 2006 Lehman Brothers won the coveted “Credit Derivatives House of the Year” award. So they must have been doing something right. They were the best! Or rather, they were the best at whatever it is those people think they're doing. I imagine the competition was pretty brutal. But Lehman Brothers were consistently able to come up with things like unique exposure to Asian corporate risk, which kicked so much ass.

Labels: Missing Billions

Pardon me, but what is this? I keep reading stories about how some huge financial institution, that lives in a penthouse and has private jets at its disposal, finds itself in a bit of a spot through bad deals, and banks step forward to help them out. “Looks like you're a bit short, could you use two or three billion or so? We know it's not much, but—no, no—pay us back when you can.”

Labels: Missing Billions

CNN has the following story: Bush taps general to coordinate war efforts.

That's a terrible admission of failure right there. Everybody knows when something's beyond fixable, then folk long to change management. It's the last effort of the dying organization, struggling for breath. If you were an investor, that would be a tip not to buy some company. “We had a big management shakeup, replaced the whole team, found a new Head of Chiefery, but we're all better now!” I don't think so. I think you're circling the drain.

At the very least, the desire to invent a whole new position to run something after that thing has been running for a few years means there's something wrong and you don't know how to fix it.

When the US started trying to coordinating all its efforts to control illegal drug trafficking and use, the people they appointed to head the coordination were informally called “drug czar”. That made sense because it was ad hoc and unprecedented, or “special”. But foreign wars aren't. It's one of the things that a government must know how to do. This war in Iraq, however, is turning into some new kind of warlike activity programme. On the one hand, President Bush talks as if it were a struggle for the future of mankind, while on the other he's now trying to insulate himself from it. If he could outsource it entirey, he would.

Labels: Missing Billions

In this Guardian story:

The US flew nearly $12bn in shrink-wrapped $100 bills into Iraq, then distributed the cash with no proper control over who was receiving it and how it was being spent.
[...]
In the year after the invasion of Iraq in 2003 nearly 281 million notes, weighing 363 tonnes, were sent from New York to Baghdad for disbursement to Iraqi ministries and US contractors. Using C-130 planes, the deliveries took place once or twice a month with the biggest of $2,401,600,000 on June 22 2004, six days before the handover.

That would be the best birthday present ever, a couple of pounds of shrink-wrapped $100 bills. “I didn't know what to get you, I don't know what you're reading these days and I haven't been keeping up with all the new movies.” “Oh, c'mon, this is great. I can always use some shrink-wrapped hundreds—you know me.”

I know from personal experience with suitcases of mob money that I keep finding in my taxi or in the trash that one million in hundreds makes a stack about one metre in height. In fact, that's how the French first determined the length of the metre, a little-known fact. A pallet is usually about four feet each way, so you could get 100 million in there easily enough.

Labels: Missing Billions

Lawmaker: U.S. sent giant pallets of cash into Iraq

“We've made a huge mess and you people won't stop trying to figure it out, and that's just not helping.”

Republicans argued that Bremer and the CPA staff did the best they could under the circumstances and accused Democrats of trying to score political points over the increasingly unpopular Iraq war.

“We are in a war against terrorists, to have a blame meeting isn't, in my opinion, constructive,” said Rep. Dan Burton, an Indiana Republican.

According to the story, the money that has gone astray is real money, great planeloads of bills weighing tons and loaded by forklifts. I initially thought they meant sums of virtual credits streaking in and out of bank accounts via wire. It's easy to see how that could get misplaced in “service charges”, heh-heh. But actual money? Who lets that out of their sight?

Years from now there will probably be an “Unsolved Mysteries” episode about this. Old guys in the desert will tell tales about Bremer's Billions around the campfire, to the scorn of young hotheads. “Aww, cut it out, Pops—no one believes those old yarns,” etc.

Labels: Missing Billions