Comments on: Stop crying me a river – you took on the risk now deal with the consequences. http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences Wed, 16 May 2012 14:32:55 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: shadox http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-7173 shadox Sat, 21 Apr 2007 09:10:38 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-7173 So, by that rationle, if any risky investment (which by that definition is anything that is not FDIC insured) goes bad, investors should not attempt to get their money back? Yes, the risk was Argentina defaulting. But does that give ARGENTINA the right to just default and walk away without its creditors trying to do something about it? I really don't get the argument. BTW, regarding the bail-out question, there are some cases in which bail-outs are justified in my opinion. Those include: (i) situations where if a firm is allowed to fail the implications for the national economy are unacceptable - such as the bail out of the hedge fund LTCM a while back; and (ii) situations where a lot innocent bystanders will be hurt in an unacceptable way. For example, the failure of a large employer through some sort of natural or man made disaster (e.g. airlines after 9/11). So, by that rationle, if any risky investment (which by that definition is anything that is not FDIC insured) goes bad, investors should not attempt to get their money back?

Yes, the risk was Argentina defaulting. But does that give ARGENTINA the right to just default and walk away without its creditors trying to do something about it? I really don’t get the argument.

BTW, regarding the bail-out question, there are some cases in which bail-outs are justified in my opinion. Those include:

(i) situations where if a firm is allowed to fail the implications for the national economy are unacceptable – such as the bail out of the hedge fund LTCM a while back; and

(ii) situations where a lot innocent bystanders will be hurt in an unacceptable way. For example, the failure of a large employer through some sort of natural or man made disaster (e.g. airlines after 9/11).

]]> By: anon http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-6732 anon Wed, 18 Apr 2007 16:40:48 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-6732 But Argentina defaulting on its debts IS the risk. Everyone knows that such a country is more risky than say, the United States. There's a reason we have rating agencies that try to distinguish between different types of bonds. (Side issue: I remember reading in a Frank Partnoy book about various forays into foreign markets, with derivatives that were "disguised" as bonds. The main theme of the book was that investors often do not know what they're buying, and so these Argentinian investors might not be quite as guilty as they seem. An example closer to today would be many people who had invested in seemingly safe securities -- pension funds or corporate bonds -- which unbeknownst to the main public actually had significant money tied up, directly or indirectly, in subprime mortgages.) As for bailouts I'm really curious about why anyone says bailouts are a good idea. Oddly, they aren't uncommon in history. Actually, for large corporations or banks, they're the rule rather than the exception. But why? But Argentina defaulting on its debts IS the risk. Everyone knows that such a country is more risky than say, the United States. There’s a reason we have rating agencies that try to distinguish between different types of bonds.

(Side issue: I remember reading in a Frank Partnoy book about various forays into foreign markets, with derivatives that were “disguised” as bonds. The main theme of the book was that investors often do not know what they’re buying, and so these Argentinian investors might not be quite as guilty as they seem. An example closer to today would be many people who had invested in seemingly safe securities — pension funds or corporate bonds — which unbeknownst to the main public actually had significant money tied up, directly or indirectly, in subprime mortgages.)

As for bailouts I’m really curious about why anyone says bailouts are a good idea. Oddly, they aren’t uncommon in history. Actually, for large corporations or banks, they’re the rule rather than the exception. But why?

]]> By: Shadox http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-6697 Shadox Wed, 18 Apr 2007 07:44:09 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-6697 I am much against bail-outs and the like. In fact, I just wrote a big post about how the brewing sub-prime bail out is a really bad idea. HOWEVER, I think you got this one wrong. You may not like the tone of the ads, but these guys are people who are trying to get back money that they invested. It doesn't sound to me like they are asking for a bail-out. All their asking for is that Argentina respect its committments. Is that a bad thing? Sure, they took a risk with their money. I am sure most of them were diversified (especially if they were institutional investors), but that doesn't give Argentina the right to just walk-away from its debts... I am not really sure what your concern with this effort is. As far as I can tell these are creditors asking the borrower to pay back what he borrowed. How is that wrong? I am much against bail-outs and the like. In fact, I just wrote a big post about how the brewing sub-prime bail out is a really bad idea.

HOWEVER, I think you got this one wrong. You may not like the tone of the ads, but these guys are people who are trying to get back money that they invested. It doesn’t sound to me like they are asking for a bail-out. All their asking for is that Argentina respect its committments. Is that a bad thing?

Sure, they took a risk with their money. I am sure most of them were diversified (especially if they were institutional investors), but that doesn’t give Argentina the right to just walk-away from its debts…

I am not really sure what your concern with this effort is. As far as I can tell these are creditors asking the borrower to pay back what he borrowed. How is that wrong?

]]> By: CMB http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-6642 CMB Tue, 17 Apr 2007 14:18:40 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-6642 You got it right. Ignore the whiners. Anybody who was dumb enough to buy emerging world debt without a risk premium needs a lesson, and anyone who got the premium has no right complaining. You got it right. Ignore the whiners. Anybody who was dumb enough to buy emerging world debt without a risk premium needs a lesson, and anyone who got the premium has no right complaining.

]]> By: » Start Your Morning With The Top From pfblogs.org on Consumerism Commentary: A Personal Finance Blog http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-6621 » Start Your Morning With The Top From pfblogs.org on Consumerism Commentary: A Personal Finance Blog Tue, 17 Apr 2007 10:11:31 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-6621 [...] Stop Crying Me a River. You Took on the Risk, Now Deal With the Consequences. From the title, I thought this would be a post about pacing blame for sub-prime loan blow-ups on the borrower. Actually, the article is about a situation in Argentina, but the author is guessing at the nature of the issue. [My Financial Journey] [...] [...] Stop Crying Me a River. You Took on the Risk, Now Deal With the Consequences. From the title, I thought this would be a post about pacing blame for sub-prime loan blow-ups on the borrower. Actually, the article is about a situation in Argentina, but the author is guessing at the nature of the issue. [My Financial Journey] [...]

]]> By: j2r http://myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences/comment-page-1#comment-6560 j2r Mon, 16 Apr 2007 17:22:29 +0000 http://www.myfinancialjourney.com/archive/stop-crying-me-a-river-you-took-on-the-risk-now-deal-with-the-consequences#comment-6560 I commend you for not having any cash advance sponsors on your site. I've noticed some personal finance sites with these ads. And I thought it was really messed up. To give financial suggestions and at the same time having cash advance sponsors. I commend you for not having any cash advance sponsors on your site. I’ve noticed some personal finance sites with these ads.
And I thought it was really messed up. To give financial suggestions and at the same time having cash advance sponsors.

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