That’s the title of a panel I recently moderated on behalf of Public Business, featuring New York Times business editor Larry Ingrassia, Reuters finance blogger Felix Salmon, Wall Street Journal reporter Suzanne Kapner, American Banker reporter Jeff Horwitz, and Columbia Journalism Review business media critic Dean Starkman. Here’s some video of the discussion:
A post at Foreign Exchange on a Gordon Brown lecture/book launch I attended yesterday at NYU:
The basic thrust of the book is that financial reform laws in individual countries are irrelevant as tools against a future crisis, because they simply provide incentives to firms to take their riskier business elsewhere. Instead, the book pushes for formal regulatory coordination and essentially, for expanded global governance. It is not an explicitly left-wing argument, as Brown’s vision of global coordination includes a completed Doha Round and a plea for international institutions to prod China into speeding up its push for more consumer spending. [During his talk, Brown clarified this point–essentially he thinks the recent five year plan can be a two year plan if Beijing wants it to be.] My take having read the first section and skimmed the rest: It’s a pretty good blueprint, but completely unfeasible. It’s also not badly written, as far as books by ex-politicians go. Certainly a relief after the purple prose we got from Blair.
After laying all this out in a short lecture, the former PM took a few questions.
Since I started writing professionally in 2005, I’ve covered a pretty wide terrain: from tech to media to energy to regulation to macroeconomics to international geostrategy. The upside of that is the rich and diverse set of experiences I’ve had. The downside is that I rarely stay on a beat long enough to see a company or person I’ve followed through their career.
This blog is great fun for me because I get to write about all my beats at the same time, to keep my fingers in multiple pies even when, professionally, I’m covering just one or two.
Today, I learned that Lending Club, a peer-to-peer loan site has hit the 10 million dollar mark in loans, secured its Series CÂ round of funding and started to tap top talent from other e-businesses. I haven’t written about social media in a while, but way back in 2007, I wrote about Lending Club for BusinessWeek, where social media was my primary beat. I said then: Read the rest of this entry »
The other night I attended a Q&A; between BusinessWeek editor Steve Adler and Citigroup CEO Vikram Pandit. It was part of a series called “Captains of Industry” and I’ve been to some talks with other business leaders in the past. Usually Adler focuses on their personal story and character, rather than on the specifics of the business they run. This can work in interviewees’ interest: they BENEFIT from being candid/controversial/self-deprecating to counter popular perceptions of business leaders as cold and calculating and give wise-older-person guidance to the mostly young professionals who seem to populate the audience.
Now in Pandit’s case, the setup for personal storytelling seems ideal–his unpopularity is stunning, there are tons of young confused would-be financiers in New York hungry for advice, and he’s got a great narrative: an Indian immigrant running an American giant at a time when India is on the rise.
But instead, Pandit flat-out refused to answer questions about himself as a person, almost as though he didn’t understand that it was to answer those questions that he was there. Even Adler seemed flummoxed–I’ve never seen him or anyone actually admit mid-interview that the chat wasn’t going to plan. It didn’t diminish my already considerable esteem for him as a reporter: after all, the questions he asked were much tougher than the drivel Charlie Rose put to Pandit in the fall. Indeed, it somewhat comforted me as a young reporter that even veteran aces get phased sometime by their sources.
Here’s the thing: Pandit had a few decent and interesting things to say about Citi itself, successfully avoiding the ugly truth about the company without outright lying. That made me think he was operating in the persona required of him at a CEO conference call, where hedging is key and ‘no comment’ is sometimes appropriate. He seemed to simply not understand that what this event called for was precisely the opposite. Is that Pandit’s stupidity, or a massive PR fail at Citigroup where someone forgot to brief the boss about what to do? (I’ve seen this problem before–there are many executives who seem not to understand how much they benefit from taking a side, even if its risky, in their answers to questions, and how much more cynical and hostile press coverage gets when they try to please.)
Watch the video and let me know what you think. It’s about an hour long, so if you’re rushed, these are some highlights (not verbatim, I don’t type that fast): Read the rest of this entry »
Some weeks ago, I read a mediocre rant about the alleged “evils” of Goldman Sachs. I rolled my eyes at yet another knee-jerk-populist, unproductive reaction to the recession. The next day at the gym, Chris Matthews had the author, Matt Taibbi, on, and began drooling all over him as some kind of investigative tour de force. The meme caught on. Not only has Taibbi been on TV nonstop, but friends who usually scrunch their noses in confusion at my business-journo world have been chatting me up constantly about the Goldman conspiracy and crediting Taibbi with discovering it. Allow me to correct the record.
According to Taibbi, Goldman Sachs deliberately inflates speculative bubbles by finding or manufacturing securities out of worthless assets and selling them to the public as secure; then they  get themselves out before it crashes; or, they rely on high-placed alumni to to save them. Moreover, they’ve done so in “every major market manipulation†of the last century. His case studies: The Great Depression, the DotCom Boom, the Housing Boom, the Commodities Boom (ie high gas prices), The Bailout, and (coming soon to a theater near you), Cap and Trade. This argument, which I’ve summarized in one paragraph, takes Taibbi (get this!) 10,000 words. I’m going to explain why he’s a hack in 1/10 the space. Still a long post, for which I apologize. Read the rest of this entry »
In a recent column, the International Herald Tribune’s Roger Cohen makes the case that with the financial sector in turmoil, jobs at GoldmanSachs and JPMorgan might lose their appeal for bright young things coming off the Ivy League assembly line, fueling a renewed interest in public service. To Cohen, that “rediscovery of the public sphere” is an end in itself, since he associates periods in American history when the public sector had prestige with prosperity, international prowess and high morale. (I’m somewhat inclined to agree, but that’s beside my present point).
I believe a renewal of the public sector as a high prestige career for the nation’s brightest would go a long way to preventing future crises like this one. Unlike the recession after 9/11, or the oil crises of the 1970s, the current collapse is the direct result of human malfeasance, not the consequence of external forces. The nation’s brightest minds went to Wall Street, armed with the Michael Douglas belief that greed is good, and more than enough Ivy League education to find the legal and accounting loopholes that allowed them to make absurdly leveraged deals and endorse Swiss cheese loans. Meanwhile, regulators slept at the switch.
But even if they had tried, what could the regulators have done? John McCain may have spoken out of turn when he trashed Chris Cox, SEC Chairman, this week. But in principle, I sort of agree with him. The people who staff our regulatory agencies mean well, but they are just not as sharp as the people they are meant to regulate. And that’s because smart young people don’t want to take jobs in government.
I sent Cohen’s piece around to friends, and one set of comments from a U.Penn senior really hit home. He’s applying for those finance jobs, despite the current hiring freeze, because 1. it pays more and 2. working for the government is beneath his SAT score. Public service he says “isn’t something the smartest people need to do. It’s something most people can do.” So long as smart kids think that public service is for dummies, we’ll have dumb public policy.
What’s the solution? My mother, a nonprofit activist, had some good ideas. Sweeten the deal for government employees with better pay, subsidized housing or discounted college tuition for their kids. “Even if it meant higher taxes, it would surely be cheaper having smart regulators than a 700 billion dollar bailout later.”
I’m finally old enough to admit it: Mama knows best.