Colorable Claims: Why Is Banking Less Accountable Than Baseball? - OpenLeft

[WillyT]

Colorable Claims: Why Is Banking Less Accountable Than Baseball?
by: Natasha Chart
Fri Mar 12, 2010 at 19:42

<snip>

From a Los Angeles Times article about Pete Rose's exile from baseball:

... Under major league rule 21(d), players, officials and club employees face a one-year suspension for betting on games involving other teams. Those placing wagers on games in which "the bettor has a duty to perform shall be declared permanently ineligible."

... "There is no temptation on this Earth that could ever get me to fix a game. None. End of story," wrote. "As out of control as I got with my gambling, I never bet against my own team."

The prohibition against gambling is perhaps baseball's most sacred rule, with the aim of assuring the integrity of competition. ...

Here's a post-mortem of Goldman Sachs' payout from the collapse of AIG by Henry Hu, explaining Goldman's relationship to the failed insurance giant:

... But a curious incident that fateful day raises significant public policy issues. Goldman Sachs reported that its exposure to AIG was "not material." Yet on March 15 of this year, AIG disclosed that it paid $7 billion of its government loan last fall to satisfy obligations to Goldman. A "not material" statement and a $7 billion payout appear to be at odds.

... Thus the "empty creditor": someone (or institution) who may have the contractual control but, by simultaneously holding credit default swaps, little or no economic exposure if the debt goes bad. Indeed, if a creditor holds enough credit default swaps, he may simultaneously have control rights and incentives to cause the debtor firm's value to fall. And if bankruptcy occurs, the empty creditor may undermine proper reorganization, especially if his interests (or non-interests) are not fully disclosed to the bankruptcy court. ...

Baseball holds integrity of outcome and good-faith competition as a sacred value, the banking industry, not so much. The industry's culture of corruption came to the forefront today, as a new report on Lehman Brothers' shady dealings (including "actionable balance sheet manipulation" and "nonculpable errors of business judgment" against which "colorable claims" could be made) under the not-so-watchful eyes of the NY Federal Reserve and Timothy Geithner.

Our banks have been getting to move risk off their books as if it didn't exist, bet so heavily against their own investments that they're better off if those investments fail, and have reached a stage of national nihilism that's led to a brisk market in betting that the US Treasury will go under.

Wall Street's been on a gambling bender with the country's life savings that would make Bill Bennett blush, but without the same level of accountability Pete Rose faced. Because, you know, the integrity of baseball is important to Congress, who believes firmly that professional sports clubs need to be self-policing and set a good example if they want to escape strict scrutiny and sanction.

Anyway, these are the things I think about. I'm going out for a drink now.

<snip>

Link: http://www.openleft.com/diary/17813/colorable-claims-why-is-banking-less-accountable-than-baseball

Me too...

:shrug:

[ck4829]

1. Combine the accountability for oil, energy, warfare, lobbying, Wall Street, banks, etc.

And it still wouldn't match the accountability that baseball gets.

[WillyT]

2. True... And Yet, It's All About The Rules And The Refs, No ???

Otherwise... Chaos... and worse...

:shrug:

[Initech]

3. On the subject of accountability, it should be pointed out that...

It's easier to rig an electronic voting machine than it is to rig a Vegas slot machine. If they're going after baseball or banking then they should hold EVERYTHING accountable, that's all.

[BeFree]

4. heh

Yeah, there is more tracking of the stats in a baseball game than there is in an e-voted election. IOW, baseball scores are more important to most Americans than vote counting.

[doc03]

5. $$$$$$$$$$ n/t