I'm guessing Jefferson County is run be dimmocrats, but I could be wrong. Anyway, they probably could have been conned into buying something like this with the taxpayer's money. Hope this isn't a copyright infringment:
Posted on 05/27/2008 9:16:49 AM PDT by LomanBill
"As a managing director at JPMorgan Chase, Mr. LeCroy persuaded the county to convert its debt from fixed interest rates to adjustable rates. He also recommended that the county use interest-rate swaps that he said would protect it if interest rates rose. "
“Ya know what this county needs, sir? A monorail!”
Look, fixed vs. floating is a pretty simple concept. Now, I know what JPM would have showed them, as I saw these pitches numerous times from 2002-2005 or so.
A very simple presentation showing that, over time, going variable is the right thing to do. You almost always end up ahead by going variable.
Sometimes you don’t, but, for various reasons X,Y, and Z, we, JP Morgan, don’t think that there is much of a threat of significantly rising interest rates.
That is all the pitch would have been. It’s not a difficult concept. Jefferson County took a bet, and lost. It’s their fault, not JPM’s.
"The money powers prey upon the nation in times of peace and conspire
against it in times of adversity. It is more despotic than a monarchy, more
insolent than autocracy and more selfish than a bureaucracy. It denounces,
as public enemies, all who question its methods or throw light upon its
crimes. I have two great enemies, the Southern Army in front of me and the
bankers in the rear. Of the two, the one at the rear is my greatest foe."
-- President Abraham Lincoln, letter to William Elkins, Nov 21, 1864
>>Jefferson County took a bet, and lost.
Based upon the advise of Mr. LeCroy.
Not a very honorable man, given his prison record.
The problem here really goes like this:
Most politicians are really pretty simple-minded people. They’re not the sharpest tools in the shed.
And the closer you get to the local level, the more you find people who have NO idea of the intricate nature of modern finance.
So you get what we have here: A bunch of people who are familiar with modern financial products pitching high-risk products to people who still think that the banking system works the way it did in the 1930’s. The local pols see the immediate pot of money they get by selling a swap (or dabbling in some other instrument) and that’s where their attention span ends. They literally cannot foresee the net:net effects of “what happens if...?” They have the attention span of less than one term in office and this is where things bite them.
As such, political sovereigns should not be allowed to “invest” in such instruments - at all. The whole issue should simply be removed from the local level and legislated away.
fair enough, perhaps. But JPM shouldn't be sued for selling the same product they sell to every corporation out there.
Yea, that’s true. I completely agree with you.
But we’re now a lawsuit-happy society. There’s nothing that can return us to the days of common sense prevailing before someone picks up a phone and dials a lawyer. Those days seem long gone.
To quote Ron White: “There’s no fixin’ stupid.”
And in politics in the US now, at all levels, we seem to have an “abundance of stupid.”
BINGO!!!!
Shades of Joplin, Missouri.
Is that what you call one of those fence rails you carry the tarred and feathered bankers, consultants, attorneys and public officials out of town on?
They were just trying to help out a struggling county raise some funds for a county project. Right!
Huh? No, they were trying to make money. So what? A customer takes a bet, and then sues if they lose on the bet? Why should JPM be held responsible for that?
I'm guessing Jefferson County is run be dimmocrats, but I could be wrong. Anyway, they probably could have been conned into buying something like this with the taxpayer's money. Hope this isn't a copyright infringment:
Well, It Put Ogdenville, North Haverbrook, and Brockway On The Map.
I vote for schmuck.
What the article doesn't say is now he's Mayor of Birmingham. It will be interesting to see if the city manages to escape bankruptcy under his stellar leadership.
They based such a huge decision on the advice of one man? A man who could get a large fee from their business? They're dumber than I initially suspected.
>>I vote for schmuck.
I vote for Judas Goat. Langford and his ilk have betrayed the fiduciary trust of their constituents and led them straight into the jaws of a financial meat grinder.
>>They’re dumber than I initially suspected.
Is the exploitation of stupidity honorable?
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