Madoff made-off with billions...

blatantninja said:
You really can't compare the two. The weather involves highly complex patterns, sure, but they consistently follow a logic that can be broken down. Human behavior is often illogical and can't always be predicted.
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Then how come some economists *did* predict this particular shitstorm several years in advance?
 
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Are you REALLY trying to make an argument that because some economists predicted that a massive extension of credit over the past 2 decades would eventually result in a blow up (and I'm not aware of any that were any more specific than 'in the next few years' either) is the same as predicting how many recessions will occur over a period of decades?!?

It's like the difference between predicting that when a hurricane hit New Orleans, since the levees were poorly maintained and only built to handle a cat 3 anyway, that massive destruction would occur vs. predicting how many named storms will occur each year. One is a fairly straight logical conclusion, the other is not.
 
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blatantninja said:
Are you REALLY trying to make an argument that because some economists predicted that a massive extension of credit over the past 2 decades would eventually result in a blow up (and I'm not aware of any that were any more specific than 'in the next few years' either) is the same as predicting how many recessions will occur over a period of decades?!?
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No, I'm not. As you say, you can't really predict that, because you can't know in advance what kind of policy will be pursued.

What you could do, though, is have a better understanding of what kinds of things increase or decrease the likelihood of speculative bubbles and subsequent crashes. Even being able to unequivocally recognize a speculative bubble as it's inflating rather than after the fact would be a big help. I don't think either of these things are fundamentally beyond human understanding, especially as *some* economists did understand them and explain in advance exactly what they meant.

Nouriel Roubini is one who got just about everything right, by the way -- the timing, the consequences, the sequence of events, and the underlying reasons, well beyond "the next few years."

It's like the difference between predicting that when a hurricane hit New Orleans, since the levees were poorly maintained and only built to handle a cat 3 anyway, that massive destruction would occur vs. predicting how many named storms will occur each year. One is a fairly straight logical conclusion, the other is not.
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Right -- and my point is that economists in general (as opposed to some economists in particular) can't even make the latter prediction. If their models were correct, recessions would only happen for exogenous reasons. (Hell, David Brooks argued in NY Times just the other day that this one is happening for exogenous reasons, because the idea of a market generating instability endogenously simply can't fit into his mental models. He's not an economist, of course, just a somewhat whiny talking head, but still.)
 
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Prime Junta said:
What you could do, though, is have a better understanding of what kinds of things increase or decrease the likelihood of speculative bubbles and subsequent crashes. Even being able to unequivocally recognize a speculative bubble as it's inflating rather than after the fact would be a big help. I don't think either of these things are fundamentally beyond human understanding, especially as *some* economists did understand them and explain in advance exactly what they meant.
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I agree. And people recognized the speculative bubble several years in advance on both the Dot.com and housing bubbles. The smart got out. The greedy stayed in. The problem is that the average person is too ignorant (willful or otherwise) to understand the consequences of these bubbles. And that person votes, and won't vote for the politician that tries to pop the bubble before it gets too big.

Nouriel Roubini is one who got just about everything right, by the way -- the timing, the consequences, the sequence of events, and the underlying reasons, well beyond "the next few years."
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Yeah, in September of 2006, he came out and 'clearly saw the bubble and its consequences.' Sept 2006. That's better than a lot of the idiots passing themselves off as experts, but it's not that far in advance. Had he come out in 2002-2003 when the sub-prime market was taking off, I'd be far more impressed, and it would be far more useful as by Sept of 2006, a lot of the damage had already been done. As early as 2005, Roubini wrote, "'home prices were riding a speculative wave that would soon sink the economy.' So he was only off by about 3 years. Not particularly accurate.

I've seen him speak. He's smart, but he doesn't have a crystal ball.

[Right -- and my point is that economists in general (as opposed to some economists in particular) can't even make the latter prediction. If their models were correct, recessions would only happen for exogenous reasons. (Hell, David Brooks argued in NY Times just the other day that this one is happening for exogenous reasons, because the idea of a market generating instability endogenously simply can't fit into his mental models. He's not an economist, of course, just a somewhat whiny talking head, but still.)
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Not true. They can give a decent idea that on average, every 3-4 years, a recession will occur, and historically that's reasonably accurate (well until we started using credit to push us out of every potential recession). We might be able to have an idea of when they are going to occur, but that doesn't mean we'll be able to avoid them. Continuous positive growth simply isn't a reasonable exception.
 
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A note of caution: any system or model have its critics and iconoclasts who will cry "I told you so!" after something goes wrong. But, thanks to the internet, we can go back and see if somebody was simply a general doomsayer or if he/she accurately predicted causes and effects of the problem. It's like fortune teller claiming that he/she predicted Katrina while, in fact, all what he/she said was "there will be a great flood".
 
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I've always wondered - what's the point of sentencing someone to more than their lifetime? It's not like they'll keep the body in jail after his death? Is it?

Hmmm. A haunted prison......
 
Perhaps he used his billions to create a machine to put himself under cryogeny? Who knows!
 
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lghartveit said:
I've always wondered - what's the point of sentencing someone to more than their lifetime? It's not like they'll keep the body in jail after his death? Is it?

Hmmm. A haunted prison......
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I imagine most prisons are haunted, in one way or another...

Sometimes, a sentence like that is imposed to forego any legal wiggling off the hook, like time off for good behavior(early probation because you've been a good boy,)etc. This way there's no way a prisoner proved guilty can avoid serving a full life sentence.

In this case, it was also a symbol of how heinous and vile his crime was, and while it can't restore the lives of the people who trusted him or give them back their money, it can at least reassure them that this man will never be released to cheat anyone again. :)
 
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lghartveit said:
I've always wondered - what's the point of sentencing someone to more than their lifetime? It's not like they'll keep the body in jail after his death? Is it?

Hmmm. A haunted prison......
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Because we have far too much of that "Euro Enlightenment" and don't save everyone the hassle with a quick bullet to the brainpan.
 
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@Magerette: Ah, I understand. Thanks for the explanation.

@dteowner: I wasn't trying to ridicule the american system. AFAIK you're not the only one doing this. I've been wondering why, and the Madoff case provided the trigger for asking.
 
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lghartveit said:
I've always wondered - what's the point of sentencing someone to more than their lifetime? It's not like they'll keep the body in jail after his death? Is it?

Hmmm. A haunted prison......
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It's because they're charged with multiple crimes, typically, and each comes with its own sentence - and then you have multipliers, etc, to consider.
 
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I have found it a bit interesting that the government securities insurance thing doesn't actually cover anyone ruined by this on the grounds that Madoff never actually invested in any securities.
 
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lghartveit said:
@dteowner: I wasn't trying to ridicule the american system. AFAIK you're not the only one doing this. I've been wondering why, and the Madoff case provided the trigger for asking.
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Actually, *I'm* the one ridiculing the US system on this front. If the intent of a 150 year sentence is that a guy will never, ever see the outside world again, then there's no functional difference between that and the death penalty. We get bogged down in mamby-pamby lefty morality (strongly espoused by the "death penalty is just so barbaric, you stupid pigdogs" Euros, in this case) and warehouse these jokers until they do us the favor of dying instead of making it quick and cheap (yes, we've got work to do on "quick and cheap" at this point, although a fair bit of that problem goes right back to the morality complications).
 
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I know that personally if someone gave me a choice between 150 years/life in prison and death, I'd choose death. Why not just pump someone full of morphine so they drift off peacefully? I'd consider it more humane than locking someone in a cage for decades.
 
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dteowner said:
Actually, *I'm* the one ridiculing the US system on this front. If the intent of a 150 year sentence is that a guy will never, ever see the outside world again, then there's no functional difference between that and the death penalty. We get bogged down in mamby-pamby lefty morality (strongly espoused by the "death penalty is just so barbaric, you stupid pigdogs" Euros, in this case) and warehouse these jokers until they do us the favor of dying instead of making it quick and cheap (yes, we've got work to do on "quick and cheap" at this point, although a fair bit of that problem goes right back to the morality complications).
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But there is a functional difference, a very basic one: dead people don't suffer. Rather than seeing life in prison as a bit of lefty compassion, I see it more as Rith does, one of the most awful things you could do to someone. I spent the night in Cook County lockup once and it changed my whole outlook on life. :)

Of course, sticking Madoff in some white collar golf club prison which is most likely where he'll end up, kind of defeats the purpose--we'll just be providing him with free security services and extending his life.
 
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I've never really bought into the whole "prison is suffering" thing. Never been, and don't plan on going, so I'm admittedly talking out my keister, but I just don't see it. The only way that works is if you've got genuine remorse, and I've yet to see that out of someone that gets a 100+ year sentence. The decision for me is based solely on efficiency. If we get past taking 20 years dicking around in these death penalty cases and economize a bit (bullets are cheap), it's cheaper to put them down than to support them for decades, not to mention the elimination of the need to build lifetime warehouses for them.
 
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dteowner said:
I've never really bought into the whole "prison is suffering" thing. Never been, and don't plan on going, so I'm admittedly talking out my keister, but I just don't see it. The only way that works is if you've got genuine remorse, and I've yet to see that out of someone that gets a 100+ year sentence. The decision for me is based solely on efficiency. If we get past taking 20 years dicking around in these death penalty cases and economize a bit (bullets are cheap), it's cheaper to put them down than to support them for decades, not to mention the elimination of the need to build lifetime warehouses for them.
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Well, do you think being locked up in a cage for fifty years would be a pleasant experience, with absolutely no control over your life or freedom to do anything? It's a quality of life issue for me. Even if I lived in a comfortable room and didn't have to worry about getting shanked, raped, or beaten, I would still hate every second of it.

It wasn't exactly prison, but during some of my darker times I had to be checked into a psych ward at the hospital by my college. So for about ten days (three different times) I was monitored 24/7, I could only eat certain food, I couldn't enjoy any creature comforts I liked, and there was absolutely nothing for me to do, the entire time. After about day four I started going stir crazy, and I had a rough idea that I was "getting out" soon. I imagine prison would be far worse then that, and if I extended that time to years, decades, or "forever", I'd rather just end it.

Quality of life is what matters to me.
 
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