Felix Salmon

How Larry Summers lost Harvard $1.8 billion

Most people, if they’ve hired a legendary fund manager on a multi-million-dollar salary to look after investments and liquidity, would listen to the advice of that person. But most people aren’t Larry Summers:

Hero of the day: Jackie Ramos

Jackie Ramos was fired by Bank of America for being too nice to their customers. Of her three commandments — do the right thing for the customer; think of yourself as a customer; and do the right thing for the company — it turns out that only one mattered.

Mark Pittman was right

Bob Ivry has the definitive obituary of Mark Pittman, a giant in the world of financial journalism, who died far too young on Wednesday. Ivry is polite enough not to call me out by name, although I deserve it:

Against liquidity

Paul Krugman today argues in favor of a financial-transactions tax on the grounds that it would discourage over-reliance on ultra-short-term repo markets, among other reasons. In other words, reliance on repos is a bad thing, and it’s a good idea for government policy to “nudge” financial institutions away from it.

Dubai’s disabused creditors

The Economist has a good short overview of the situation in Dubai, which includes this interesting take:

Cracking down on destructive lenders

It’s almost quaint that there are still people out there who believe that all market participants are always rational actors making decisions in their own economic best interest. Take Daniel Indiviglio, who even stands up for IndyMac and its “inequitable, unconscionable, vexatious and opprobrious” regional manager, Karen Dickinson:

The dollar’s still not safe

One quote jumped out at me from the Reuters Dubai round-up this morning:

“We have seen a classic risk aversion reaction in the markets over the past 24 hours. The dollar has slumped, the yen is stronger,” a Societe Generale note said.

Dubai World: A great precedent

The Dubai World default is big news — big enough that it’s even made it into Gawker. Your one-stop shop for bloggy coverage this Thanksgiving is Alphaville, which features for instance this wonderful chart of the debt structure which is now being crawled over by lawyers around the world.

Counterparties

Why You Should Support The Lynch Amendment: Don’t let banks own more than 20% of derivatives exchanges! — Rortybomb