Wednesday, October 14, 2009

When the sense of enoughness gets lost, everything goes to hell

There was a funny Op-Ed by Calvin Trillin in the New York Times today about the collapse of the financial markets last fall. He attributes it to the migration of the smart guys to Wall Street, which previously had been staffed by Ivy League graduates in the bottom third of their class, nice guys who weren't particularly greedy. They were content to make enough money for a house in Greenwich and "maybe a sailboat." Then the smart people started inventing complicated, incomprehensible ways to make obscene amounts of money. Eventually the not-so-smart guys followed the lead of the smart guys.
When the smart guys started this business of securitizing things that didn’t even exist in the first place, who was running the firms they worked for? Our guys! The lower third of the class! Guys who didn’t have the foggiest notion of what a credit default swap was. All our guys knew was that they were getting disgustingly rich, and they had gotten to like that. All of that easy money had eaten away at their sense of enoughness.
Kind of says it all. When the sense of enoughness gets lost, everything goes to hell.

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