This seems like a reasonable place to start a discussion, but hard to assess without real proposals. If I had to guess at what he is suggesting it seems to argue for all risk to be borne by the company, which really seems like an argument for less risk taking and more consolidation, not too surprising from a military man, but pretty anathema to technologists.
The market will still be free. The business that protects its workers will be outpaced by the business that automates with minimal staff. If you ask an existing business to retain its staff, a new business will appear that will capitalise on automated efficiency as they have no benchmark on which to be compared (eg. Walmart importing cheap Chinese junk or Uber bypassing taxi industry protections).
I applaud the attitude. In fact, I'd love to see similar ethics applied to the media. The prejudice I see from most media outlets (especially around gender discrimination) is absolutely appalling. Domestic violence is a prime example. I rechecked today to see if the media had stopped its extremely sexist views and was disappointed to see a complete lack of ethics.
As a defender one is a partaker in a war. As partaker in a war one can choose to either take or not take prisoners and one can choose to torture said prisoners or not. These choices represent different levels of ethicality.
It's also not always necessarily attacker vs defender. You can have wars between two sides that both want to go to war.
Also, there was a whole period of war (the so-called Cabinet Wars, https://en.wikipedia.org/wiki/Kabinettskriege) which was for the most part just princes with smaller armies in a very constrained manner fighting each other. So it's not always the same there.
And yet it is internationally recognized to exist. Here's a video that goes into how war has more formalized ethics than, say romance. https://www.youtube.com/watch?v=oThh3_Srxtc
It's useful to recognize it, while simply abiding by only the parts of it which suit you. After all, if you need to, you can always ignore it and deny it.
Absolutely, and I didn't mean my post to come across that way. This topic makes me a bit glum, and I think that comes across as defeatist, but I'd rather take on the correct, losing fight, than not fight at all.
On the other hand, the Thirty Years War caused such destruction that the institutional memory in European nobility lasted 250 years. Total warfare on such scale was only seen again during the Peninsular War.
Which is they Geneva Conventions and other treaties of the like make it clear that the protections only apply to groups that have signed and follow them.
The proto-ISIS militia groups in Iraq did not, and would deliberately target civilians, refused to wear uniforms, and hid among civilian population. Because of that they did not have POW rights that afforded to legitimate militias.
Refusing POW rights is as much a reflection on those they fight as it is on ISIS. If you're making categories like this you have crossed the moral line, if not the legal one.
POW rights are earned by wearing uniforms. Not wearing uniforms means you've passed a moral line that encourages the murder, if not slaughter, of civilians.
That may be legally correct but is that morally ok? How do you apply this to groups history looks upon sympathetically? French partisans come to mind, but there are dozens of other groups that had similar situations. Selectively deciding abuse of humans is ok is a slippery slope. Not wearing a uniform may relate more to total oppression or occupation rather than be an indicator of disregard for civilians.
> Of course, the Just War Ethic suffers from a problem: The normative ideal in this case is the absence of war, yet the reality of war precludes that ideal. Therefore, any applied ethics of war are by definition morally flawed. The question for the ethicist then is this: Is it more ethical to make continued (and often ignored) normative pronouncements against the existence of war, or to engage with the temporal reality of war with ethics that seek to limit the cases in which war is undertaken, to moderate its effects, and to guide it toward the normative goal, with the understanding that this goal is not immediately or fully achievable? Obviously, advocates of the Just War Ethic, myself included, come to the latter conclusion.
The author's argument is a good one, but note that, in the (perhaps rare) case of just wars, he doesn't even have to concede this point:
> The normative ideal in this case is the absence of war, yet the reality of war precludes that ideal. Therefore, any applied ethics of war are by definition morally flawed.
With the exception of true pacifism, which is exceptionally rare, essentially everyone agrees that there are just uses of violence. When within a nation with a functioning government, this is the police's uses of force. When it's between nations, it's war. No one would think that rules governing the police's use of violence are inconsistent with the fact that we'd all prefer violence be unnecessary. Likewise, there are at least some just wars (by at least one of the participants), and in these cases the just participant need not be morally flawed at all.
Wallstreet has rules. They're just not enforced. People would be shocked if they knew, for instance, how many hedge funds simply operate on a model of "black edge" insider trading.
Eh... the difference is when there's photos of war crimes something often actually happens. When it comes out that there were business crimes, no a whole lot ever happens. Maybe someone resigns. Real justice happening there...
Don't get me wrong, things slip by on both fronts. But when it's financial, there isn't any sense of moral/righteous indignation to incite actual action. It's more like, "oh, bankers are screwing people again? Well, that's what they do. They'll just worm out of this like they do everything else."
You know what? You're right. That is a huge difference, or at least, it was. Now? I think we're seeing a turning point on both; we see what happens in Syria, but realize that we're in no position to prosecute anyone... when people care at all.
That said, until very recently I would have agreed with you completely.
I've been following that through the UK news... what a hell of a thing. After Vietnam, and now with footage of these things, it seems clear that there is a truly strong desire to Not Know about some things. We'd just rather believe in certain myths, because the alternative would make it difficult or impossible to send young men and women into hell for less than dire reasons.
I'd be interested in hearing more about how these firms get away with this kind of thing. I interned at an investment firm last year and the lawyer who worked in their compliance department told me how detailed, thorough, and stringent the audit that was done by the SEC the year before I got there was. Keep in mind, this was a small firm. Do larger firms have some way of keeping those kinds of things secret? Sorry if I'm misinterpreting something here, I have almost no financial knowledge as I worked in the tech department as a programmer.
I work in an area of finance technology connected to this process. It's no different than escalation in any other form of criminality. Cops wear armor, criminals buy armor-piercing rounds. Auditors looks deeper, so the pertinent information is masked deeper.
At this point, the major gap in our financial regulatory process is at the detection layer, not the investigations layer. If you can keep specific scenarios under wraps, you can avoid things quite easily, especially if the scenarios you do cover are impressively complex and thorough. So you hire PhDs in math and physics to identify and create your algorithms. They do a great job identifying scenarios where known criminal activity occurs, but they aren't informed on the specific, complicated, and should-be-totally-illegal actions your firm is engaged in, so they are basically shooting in the dark with no chance of finding the real misdeeds. These algorithms are genius-level complex, greatly reducing the number of government employees that will be able to decipher them. You create hundreds or thousands of them, making it prohibitively difficult for anyone in a regulatory agency to take the time to understand them all, then you assure the regulators you have all your bases covered. You show them the evidence of all the wrongdoing you've identified (also an insurmountable mountain of data) and if you do not leave any glaring holes, they have to nod and walk away.
Financial regulations are important, but the idea that regulators could every truly keep the financial markets from abusing the rest of us is nonsense. They can only do so much.
What if the policy was that once a year, a set amount of people will be prosecuted? Kind of like setting quotas for speeding tickets... Where firms are ranked in terms of the volume/egregiousness of the actions committed.
Oh, and setup an anonymous tip-line. To allow other firms to "investigate" others in order to make themselves look better (might not happen every year, but I'd imagine it would be an option of last resort if something really bad needed to be covered).
Shady things will still happen, but there will be attempts to reduce it just enough so others take the hit. Plus, the public gets a few show trials to make them believe the regulators have teeth.
I've read the beginning. I cringed a little at the cartoony portrayal of Steve Cohen as some sort of emo teenager. The author clearly hadn't consulted anyone close to him and I had doubts about the accuracy.
People would be shocked if they knew how frequently soldiers put themselves in grave danger (and die) to avoid violating their command's ROI and the laws of land warfare.
Prevention, especially successful prevention, always has a terrible PR problem in that people forget the ills that motivated the original prevention framework. One can argue that the framework specifics need to be updated, but I doubt that many soldiers or officers want a reinstatement of dangers and effects chemical warfare for example.
I wasn't trying to imply the cost wasn't questionable! Part of the 'forgetting' is the imposition of new or extended interpretations of the original intent of such agreements that lose sight of the balance of value one gets.
Specially related to insider trading, the enforcement of the rules you mention is made more complicated by the fact that there are actually no laws (rules) on the books that make insider trading illegal (as well as there being no SEC rule against insider trading). When people get in trouble for insider trading, they normally point to it being securities fraud. That leaves the interpretation of what is insider trading up to the courts. I agree there are plenty of people in Wall Street that would do just about anything (including breaking a black and white rule of law) to make a buck, but there is also a pretty significant grey area for what constitutes insider trading. If you are interested, just google "Matt Levine insider trading" and a number of his daily columns with updates on various cases (and his much better explanations of the nuances of insider trading) will come up.
In war, there is a benefit to treating your enemy with dignity. Treatment of prisoners, morale("we are the good guys"), etc. In Wall Street there isn't with white collar crime only getting a slap on the risk when they put millions of people on the street.
The system is broken when corruption and misdirection is not punished with the weight of their crimes.
Wars are fought not only by the aggressors. And the aggressor can be acting to prevent amoral behavior (attacking a state which is engaging in slavery/genocide of its people, but one might argue that is an act of war in the moral sense).
If one accepts that acting in a war in such a capacity is the more moral choice than inaction, then it makes sense to talk about the ethics of war, such as: when is lethal force against enemy combatants acceptable, what weapons of war have justifiable risks?
Not if the art of war can have ethics in conduct, but where the war itself was a just one.
The only just wars are revolutionary ones, if any. Except revolution today, like the Arab Spring, isn't done in a formal war. Hell, no real revolution is done like that - even the American Revolution was predominantly guerilla tactics. The wars that obey codified ethics are always the formal wars that were started for purely unethical reasons.
The vast majority of "wall street's" corruption is its relationship to the rent seeking opportunities that the US government makes available for them. And what's hilarious is that its the same bleeding heart liberals who demand things like the government provide low interest home loans who are shocked and outraged to learn that "wall street" commits "frauds" around them (i.e. bankers are doing what they're asked to, and when it blows up in the government's face, get scapegoated).
Standard ignorant and hyperbolic discourse about Wall Street.
> When faced with illegal or immoral orders, it is the duty of professional soldiers to refuse such orders. When such a refusal occurs, it is followed by thorough investigations, and potentially courts-martial or war crimes prosecutions for those who issue such orders. In the case of the former Wells Fargo employees, the opposite occurred. Imagine the moral and societal hazard if the military permitted such retaliation against those who reported illegal and immoral behaviors.
Well's Fargo is a bank that makes money by selling financial products to people including bank accounts and credit cards. To do this they employ salespeople. These salespeople are tasked with selling these products, as much as they can. They have a compliance department that explicitly says "don't lie to people when you sell to them". The salespeople broke those rules in order to meet the sales goals, so they were fired. The way the author writes this article, it's as if they think it is immoral to be a salesman and that the executives of Wells Fargo should be court marshaled for requiring them to sell a lot of things. The analogy, and to equate selling things with war crimes on the battlefield is absurd.
> Hedge funds and investment banks utilize high-speed trading to place the individual investor at an insurmountable disadvantage.
It's unclear what the author mean's by "high-speed" trading here, I assume they mean high-frequency market making, but most hedge funds are not in high frequency market making business. Does the author know what they are talking about? Probably not. High frequency market-makers like Virtu and Hudson River are in the high-frequency market making business. And it's unclear how high-frequency market making hurts the individual investor, it's much more concrete how high frequency market makers hurt the banks (old-school market makers) and help the individual investor by closing down the bid-ask spread.
Even if hedge funds were employing techniques to put an individual investor at a disadvantage, isn't that their job? Hedge funds are in the business because they can presumably make better trades than average, and so anyone who is on the other side of the trades they are making is presumably going to be losing out. This would be like challenging an NFL team to a football game and complaining that their wide receivers are too good athletes. And why should we prioritize the "individual investor" over institutional investors? A pension fund handles money for retired pensioners, while an individual investor might be some dentist day-trader - why should we prioritize his well being over the pensioners? He presumably has enough disposable income already.
Your statements suggest that the "immoral" behavior of Wall Street is inevitable and therefore ridiculous to fuss about and I have to agree with you about that. -But there's an underlying question which you're avoiding here.
Should society, invested with the power to regulate and control behavior, regulate and control this behavior?.
At the end of the day you can still think about if the world be a better place if things were different and, if you think it would be, take action to enact that difference.
If someone trains for 5-10 years in a career, and then a company retaliates by putting a hidden, un-removable "black mark" on their record preventing them from employment in said career is despicable. It's not a war crime, but it's pretty close.
They have a compliance department that explicitly says "don't lie to people when you sell to them".
Except that's not quite what goes on.
What happens is, compliance says that. Then the salespeople's managers put them into a situation where they're required to make quota and the only way to do so is lying/fraud, they willingly turn a blind eye to anyone who lies/commits fraud, they punish people who don't make quota and hold up the liars/fraudsters as exemplars, and punish anyone who tries to blow the whistle on the whole thing.
Which is, by the way, what actually happened at Wells Fargo.
Honestly, the bank probably should've been dissolved for that one, pour encourager les autres.
I disagree with the author's premise: "Nearly a decade after one of the most devastating financial collapses in modern history, Wall Street appears as corrupt as ever."
Considering the size of 'Wall Street' the size of the ethics violations that he uses as an example are miniscule. In addition, due to the increased scrutiny that financial institutions face and the potential damage that scandals can cause, legitimate organizations seem less willing to risk ethics violations.
Also, unlike in war, ethics violations on Wall Street can be reported and prosecuted relatively easily.
As mentioned in many comments above - Wall Street has ethics, one can only hope that the current administration doesn't take steps to weaken threaten these.
I wonder how one could say this stuff with a straight face after witnessing the credit crisis of 2007, and the not only lack of consequences for the highly unethical and very likely illegal activities that lead to it, but also the subsequent largest transfer of wealth from the poor to the rich that ever took place in human history.
Bankers were literally rewarded by the system for being evil.
Many lives and families across the globe were destroyed by their actions -- be it by evictions, loss of pensions and savings that took a lifetime to build and related suicides.
The article's premise is that war is vicious yet moral, so something less vicious like wall street has no right to complain that morality is a second level concern.
A king not killing another king is moral between kings, but those that followed the loser can suffer greatly. The closer you get to becoming god, the more callous the hands gambled.
The definition of being god here is how effective you are at controlling perceptions, how your followers perceive reality, your personal religion in a way.
So from the peasants view, the kings and gods are corrupt, removed from reality. That is because the god of peasants has always been the god of livelihood, while the elites worship the god of power. The greater god ignores the lesser god.
This is an interesting and broad analogy which I hadn't heard of before.
The military, at the end of the day, is a tool (famously, another tool of diplomacy). Either it's useful or not. Likewise finance is a tool (fundamentally a service industry like gardening or medicine). We support it because it helps finance business, helps people manage their pensions etc. Sometimes sidelines are useful too (DARPA, gun hobbyists, weird financial instruments that increase liquidity for everyone).
Yet lately the ends have been forgotten and the means elevated. The recent US proposed budget suggests increasing expenditures but there is no discussion as to whether that would be useful or not (and thus whether the increase is unnecessary, too big to even too small). The same problem has emerged in Finance: the point of an financial instrument is the instrument itself. HFT that skims a bit out of the transaction (thus is worse for the fundamental buyer and seller) is considered good. etc.
People who have memorized the "marketmaking is essential" arguments for HFT may disagree with you. People who dislike arguments from "does this serve its stated purpose for society" may reject your argumentation style. I think you've got a hell of a point on both sides.
If a teeny-tiny fraction of a percentage or a penny flat tax would cause a trade to not be profitable in expectation, then that trade probably never had anything to do with the real economy in the first place.
I fundamentally believe that governments sole job should be answering the question "is this for society?" and here society doesn't mean "the people with money" which it mostly does now.
We seem to have forgotten that this is governments job and if you go back to first principles and look at government through that lens, I think you end up with the scenario where western governments are failing abd failing badly, government should be both a counterweight again other powerful interests and a referee.
Single issues take far too much prominence (which they want as divisive issues by nature serve to devide people).
Isn't "reduces spread sizes" a fancy way of saying that when a big pension fund decides to move a billion dollars from Coke to Pepsi, they pay slightly more to do so than they would if HFT didn't exist? That's what people mean when they complain about HFT affecting retail investors (as opposed to someone selling 100 shares of something on Etrade).
What no, it means they pay less. They sell coke and get slightly more, and buy Pepsi and get a slightly lower price.
Instead of say, Coke being at 194.01 bid and 194.02 ask, that might narrow to 194.012 bid and 194.018 ask. If you trade in that market, you're better off.
The loser is the company previously making the market, which had been buying at 194.01 and selling at 194.02.
But if they couldn't adjust their price so fast, the spreads would be higher in the first place to account for the risk.
Nobody has the right, or should have the right, to sell a billion dollars in any market without moving the market before it's over. Why should someone take the other side of that trade, knowing the price will crash as soon as it's over?
All of these details sound plausible, but as whole this (the assertion that the profit made by HFT comes primarily at the expense of other market makers) smells wrong. If that assertion were true, it would seem to imply that market-making is less profitable today than in the past. Is that the case? I was under the impression that it was more profitable.
There's the Geneva Convention. Not all countries have signed on, and the countries that have don't necessarily follow them all the time or when they think no one is looking, but that doesn't mean that there aren't mostly-agreed-on standards for what is or is not a war crime.
If universal adherence were a necessary characteristic of ethical standards, we wouldn't have many that pass that test.
War does have ethics. For example, the US military has rules of engagement. A great example of this is that the US at one point (70% sure) knew where the head of ISIS was. He was alegedly in an appartment building in a city in Syria. The US rules of engagement prevent the airforce from simply bombing an appartment building full of civilians, so they did nothing. That means a lot. It means that they don't simply bomb large numbers of civilians, which is a good thing. It is what makes it easy for the US military to point to ISIS and say "those fighers are uncivilized they kill civilians". It is a significant advantage on the ground, because civilians are less hatefull towards the US as a result. It is also the right thing to do.
Edit: Abu Ghraib was horrible and the solders should have been sent to prison for the rest of their lives and not just a few years.
Also, I do not support the US military and think that they cause more harm than good in their foreign engagements.
My argument is that war has ethics as long as it is peacetime. As soon as it is wartime, the ethics are quickly forgotten. The ethics are remembered again once peace is restored, but only for the losing side.
I've got another comment that lays out some historical examples of this [1], but there are plenty more.
(In particular, I'm not commenting on whether war should have ethics; I agree that it should. But factually, looking at what belligerents actually do in wartime, it doesn't, at least in any meaningful sense.)
In war, morality is a propaganda technique to convince mothers to let their sons die hero's deaths, and to convince the young and foolhardy to join a crusade that is likely to result in their death. Periods of the biggest moral clarity in war are the periods where the propaganda is the thickest and human rationality the weakest.
To believe otherwise one must believe in forces of evil that animate one side and forces of good that animate another, which is a profoundly supernatural view.
Similarly, this article suggests that Wall Street lacks morality and uses as an example a VC considering layoffs that would occur if she fails to fund a round.
If there is a finite amount of money, an investor will invest in the firm that shows the most promise. Many teams of hard working people are seeking investment, but only some will get it. The investor must use the available information to decide where to place her bet.
If the investor is wrong, she will not be able to afford to bet again in the future. Should we all fell sorry if the investor makes a bad decision and a team of people spent several years getting paid to pursue an ill-fated idea? Arguably, the cost to society for this misstep is great, so perhaps we ought to appoint a wise investment minister to make the choices judiciously on behalf of investors? Why not also appoint a hiring minister to direct job-seekers only toward the most promising startups? For that matter, why not also appoint a business strategy minister to help startups make good decisions and avoid bad ones?
While these ministerial posts sound absurd in the context of startups, this is our reality in the world of banking and housing. Ministers tell our banks how much reserve capital they ought to carry, they tell our housing market what a reasonable rate is for a 30 year mortgage, etc.
Fannie and Freddie flew under the radar for years without revealing their balance sheet, drastically altering the US (and world) economy all at the behest of a small number of officials. I think the reason this was allowed to occur was (ironically enough) to avoid financial bad news when our leaders were trying to sell a war.
When you introduce socialized risk the market cannot be counted on to prevent socialized losses. The game is changed. The normal incentives and disincentives do not apply.
After 9/11 for example, the government became the insurer of last resort for terrorism related claims. This came as a relief to anyone building a skyscraper or running an airline, but at what cost? It eliminated much of the incentive that would have existed in the economy to prevent terrorism.
We let our ministers create very bad policy. Rather than just writing poor people a check to help them get a mortgage, they create artificial demand for high risk housing loans, which creates a broad incentive for reckless expansion of a whole sector of the economy. They keep much of this risk on the government's books, making taxpayers accountable not for a simple payment to the poor person to allow him/her to get housing, but for the entire house of cards built upon those loans.
We cannot allow our government to try to address so-called "market failures" by creating infrastructure that distorts and hides information from the market. Not only is it paternalistic, but it also creates a tremendous amount of risk for the whole economy.
This is not an argument against welfare. We have two options for how we can think about giving welfare, either as a cash payment (with or without strings attached, fwiw) or by greasing the core infrastructure of the economy to slip in some subprime loans among the many non-subprime loans, figuring that the risk won't really be discernible by financial markets and all will be well.
When capitalism contains a lot of incentives imposed by various government ministers, "free" economic behavior adapts to exploit those incentives. This is what the author of the article disagrees with. He thinks that we should all act gen...
Frankly I don't see the point of these meaningless articles. You have a financial system which is akin to a police force whose commanders are chosen by the drug dealers, and the police employ former drug dealers on the grounds that haven been drug dealers, they know more about the drug business and they can turn their knowledge to fighting the drug war.
After a few years in drug enforcement the ex drug dealers return to work for their gangs, taking all the knowledge from working in drug enforcement with them, not to mention that they were still receiving dividends and profits from the the drug dealers who previously employed them during their stint in drug enforcement.
I really can't comprehend why any intelligent people can expect this depraved, corrupt farcical system to work. Now you have Trump, unashamedly pro-business (ie leaving the inmates in control of the asylum) and people seriously expect things to get better.
Here are your brave American presidents who can bravely and patriotically authorize the executions (ie murder) of alleged terrorists in Yemen and Afghanistan who have done diddly squat to Americans, but can't/won't a lift a finger against corrupt predatory malign financiers whose actions leave Americans indebted, dying prematurely because they can't afford good housing and good health care. Compare the deaths of Americans due to terrorism by Yemenis or Somalis, and the premature deaths of Americans due to poverty and ill-health which these banksters frauds have worsened, and tell me who Trump should be executing without any meaningful evidence or even a trial.
I am sorry but due to their corrupt financial system the politicians of the Western world are becoming more and more of a joke.
The study also says that 35% reported an increase so this could just be random noise. So the headline isn't directly wrong but it isn't sending an honest message.
Historically the idea of war having rules has had a very unfortunate past. In WW1, Germany began unrestricted submarine warfare in 1915 and torpedoed the passenger liner Lusitania (filled with neutral civilians). There's a long list [1] of hospital ships deliberately sunk in WW1.
Then in WW2, aside from even more unrestricted submarine warfare and sinkings of hospital ships [2], we also have the firebombings of Dresden, Tokyo, and every other major axis city; machine-gunning of shipwreck survivors in the water; the atom bombs; the impressment of Koreans into service as "comfort women" for Japanese servicemen; forced labor at both axis & allied prisoner camps; the internment of Japanese-Americans in concentration camps; and of course the Holocaust.
Modern-day, there's the My Lai massacre and Obama's attack on a Doctors Without Borders hospital [3]. Probably more too, but you don't hear about them.
The author cites that war has rules because rules are written down, but rules are written down for Wall Street as well. They're just not enforced. And similarly, the laws of war are only enforced on the losing side, or on scapegoats that the actual decision-makers make available as a token sacrifice. When it comes to actually conducting a war, belligerents usually follow just one rule: win.
Sure there is - it's the ordinary people who make their money through trading their labor and invest it through a retail brokerage. In other words, most likely...you, the reader.
Hear that a company is going to beat estimates from your friend the accountant at a party and act on it, and you'll get busted for insider trading. Develop a complex algorithm to identify all the other people who are trading on inside information and do what they do, and chances are nobody will figure out what you're doing.
Cheat on your taxes, and you'll get busted for tax fraud. Move earnings through a complex web of offshore subsidiaries in Ireland, Dubai, and the Cayman Islands, and you're technically following the laws of all of those individual countries, but still end up paying less taxes.
Start a pyramid scheme through an e-mail chain letter, and you'll get busted. Start a pyramid scheme by creating a ride-hailing app and bringing on progressively wealthier and more powerful investors, and soon you'll own transportation.
Borrow lots of money on your credit card, and you'll be dealing with aggressive debt collectors for the rest of your life. Borrow lots of money from banks for a series of increasingly more speculative real estate & casino deals, go bankrupt 4 times, start a reality TV show, run for President, and soon you'll own the world.
To be fair the Lusitania was packed with ammunition, so it's a little harder to say it was unjustified, but it definitely was used as allied propaganda to fuel anti-german sentiment. Also as terrible as it is, Japanese internment was ruled constitutional (and is regarded by many as a very terrible ruling). I think your larger point is still true, and rules are for the losers (aka Nuremberg).
http://www.centenarynews.com/article?id=1616
My understanding is that the Americans were using these ships to carry arms. Is it even in debate anymore that the Lusitania was carrying arms anymore?
Hiding bombs under orphans and sick folks is dirty business I recall how much we criticized the Iraqis for doing the same.
My point is that in times of war, belligerents on all sides will resort to dirty business regardless of what the rules of war say. If the Lusitania was carrying arms (which I'd vaguely heard and have no reason to doubt), that'd support my point.
Your first post went on at length (and with sources!) about how rules aren't worth anything because they'd be broken anyway.
Example: German submarines attacking a civilian ship in WWI.
Unfortunately you missed the most important point in your story - which is that this ship wasn't so innocent and civilian after all.
Rather than ignoring the rules, the Germans broke them in retaliation AFTER the Americans had done so first.
The message here is not "rules never work", as your first post implies.
It's rather "if you (US) brake the rules, expect the others (Germany) to do so as well in retaliation."
The fact that Lusitania was carrying arms does not support your initial point but rather changes the story and implications entirely.
I said nothing about whether rules aren't worth anything or not. I said that they will be broken.
The former is a normative statement. The latter is a positive one. A lot of my comments here attempt to describe the world as I've observed it, not the world as I'd like it to be. I have plenty of opinions about how I'd like it to be, as well, but I usually don't share them because opinions are like assholes: everybody has one but thinks that others' stinks.
It saddens me that we've gotten to the point of comparing Wall Street ethics to war ethics and even entertaining the idea that war has better ethics than Wall Street.
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[ 3.6 ms ] story [ 168 ms ] threadI applaud the attitude. In fact, I'd love to see similar ethics applied to the media. The prejudice I see from most media outlets (especially around gender discrimination) is absolutely appalling. Domestic violence is a prime example. I rechecked today to see if the media had stopped its extremely sexist views and was disappointed to see a complete lack of ethics.
Also, there was a whole period of war (the so-called Cabinet Wars, https://en.wikipedia.org/wiki/Kabinettskriege) which was for the most part just princes with smaller armies in a very constrained manner fighting each other. So it's not always the same there.
That's the reality of war.
Sure, in a perfect world there wouldn't be any war, but that won't happen as long as there are humans.
The proto-ISIS militia groups in Iraq did not, and would deliberately target civilians, refused to wear uniforms, and hid among civilian population. Because of that they did not have POW rights that afforded to legitimate militias.
> Of course, the Just War Ethic suffers from a problem: The normative ideal in this case is the absence of war, yet the reality of war precludes that ideal. Therefore, any applied ethics of war are by definition morally flawed. The question for the ethicist then is this: Is it more ethical to make continued (and often ignored) normative pronouncements against the existence of war, or to engage with the temporal reality of war with ethics that seek to limit the cases in which war is undertaken, to moderate its effects, and to guide it toward the normative goal, with the understanding that this goal is not immediately or fully achievable? Obviously, advocates of the Just War Ethic, myself included, come to the latter conclusion.
> The normative ideal in this case is the absence of war, yet the reality of war precludes that ideal. Therefore, any applied ethics of war are by definition morally flawed.
With the exception of true pacifism, which is exceptionally rare, essentially everyone agrees that there are just uses of violence. When within a nation with a functioning government, this is the police's uses of force. When it's between nations, it's war. No one would think that rules governing the police's use of violence are inconsistent with the fact that we'd all prefer violence be unnecessary. Likewise, there are at least some just wars (by at least one of the participants), and in these cases the just participant need not be morally flawed at all.
If you replaced "Wallstreet" with "War", your statement would be no less true.
Don't get me wrong, things slip by on both fronts. But when it's financial, there isn't any sense of moral/righteous indignation to incite actual action. It's more like, "oh, bankers are screwing people again? Well, that's what they do. They'll just worm out of this like they do everything else."
That said, until very recently I would have agreed with you completely.
https://www.google.co.nz/amp/s/amp.theguardian.com/commentis...
At this point, the major gap in our financial regulatory process is at the detection layer, not the investigations layer. If you can keep specific scenarios under wraps, you can avoid things quite easily, especially if the scenarios you do cover are impressively complex and thorough. So you hire PhDs in math and physics to identify and create your algorithms. They do a great job identifying scenarios where known criminal activity occurs, but they aren't informed on the specific, complicated, and should-be-totally-illegal actions your firm is engaged in, so they are basically shooting in the dark with no chance of finding the real misdeeds. These algorithms are genius-level complex, greatly reducing the number of government employees that will be able to decipher them. You create hundreds or thousands of them, making it prohibitively difficult for anyone in a regulatory agency to take the time to understand them all, then you assure the regulators you have all your bases covered. You show them the evidence of all the wrongdoing you've identified (also an insurmountable mountain of data) and if you do not leave any glaring holes, they have to nod and walk away.
Financial regulations are important, but the idea that regulators could every truly keep the financial markets from abusing the rest of us is nonsense. They can only do so much.
Doesn't solve everything here, but it probably helps a lot.
Oh, and setup an anonymous tip-line. To allow other firms to "investigate" others in order to make themselves look better (might not happen every year, but I'd imagine it would be an option of last resort if something really bad needed to be covered).
Shady things will still happen, but there will be attempts to reduce it just enough so others take the hit. Plus, the public gets a few show trials to make them believe the regulators have teeth.
Taking the high road comes at considerable unrecognized cost was all I was trying to say.
It wasn't overly easy to find.
The system is broken when corruption and misdirection is not punished with the weight of their crimes.
If one accepts that acting in a war in such a capacity is the more moral choice than inaction, then it makes sense to talk about the ethics of war, such as: when is lethal force against enemy combatants acceptable, what weapons of war have justifiable risks?
Not if the art of war can have ethics in conduct, but where the war itself was a just one.
The only just wars are revolutionary ones, if any. Except revolution today, like the Arab Spring, isn't done in a formal war. Hell, no real revolution is done like that - even the American Revolution was predominantly guerilla tactics. The wars that obey codified ethics are always the formal wars that were started for purely unethical reasons.
What rent seeking opportunities? Who are "bleeding heart liberals" and what "demands" are you talking about?
What fraud are you talking about specifically? Who was scapegoated? What should have happened, in your view?
> When faced with illegal or immoral orders, it is the duty of professional soldiers to refuse such orders. When such a refusal occurs, it is followed by thorough investigations, and potentially courts-martial or war crimes prosecutions for those who issue such orders. In the case of the former Wells Fargo employees, the opposite occurred. Imagine the moral and societal hazard if the military permitted such retaliation against those who reported illegal and immoral behaviors.
Well's Fargo is a bank that makes money by selling financial products to people including bank accounts and credit cards. To do this they employ salespeople. These salespeople are tasked with selling these products, as much as they can. They have a compliance department that explicitly says "don't lie to people when you sell to them". The salespeople broke those rules in order to meet the sales goals, so they were fired. The way the author writes this article, it's as if they think it is immoral to be a salesman and that the executives of Wells Fargo should be court marshaled for requiring them to sell a lot of things. The analogy, and to equate selling things with war crimes on the battlefield is absurd.
> Hedge funds and investment banks utilize high-speed trading to place the individual investor at an insurmountable disadvantage.
It's unclear what the author mean's by "high-speed" trading here, I assume they mean high-frequency market making, but most hedge funds are not in high frequency market making business. Does the author know what they are talking about? Probably not. High frequency market-makers like Virtu and Hudson River are in the high-frequency market making business. And it's unclear how high-frequency market making hurts the individual investor, it's much more concrete how high frequency market makers hurt the banks (old-school market makers) and help the individual investor by closing down the bid-ask spread.
Even if hedge funds were employing techniques to put an individual investor at a disadvantage, isn't that their job? Hedge funds are in the business because they can presumably make better trades than average, and so anyone who is on the other side of the trades they are making is presumably going to be losing out. This would be like challenging an NFL team to a football game and complaining that their wide receivers are too good athletes. And why should we prioritize the "individual investor" over institutional investors? A pension fund handles money for retired pensioners, while an individual investor might be some dentist day-trader - why should we prioritize his well being over the pensioners? He presumably has enough disposable income already.
Should society, invested with the power to regulate and control behavior, regulate and control this behavior?.
At the end of the day you can still think about if the world be a better place if things were different and, if you think it would be, take action to enact that difference.
If someone trains for 5-10 years in a career, and then a company retaliates by putting a hidden, un-removable "black mark" on their record preventing them from employment in said career is despicable. It's not a war crime, but it's pretty close.
Except that's not quite what goes on.
What happens is, compliance says that. Then the salespeople's managers put them into a situation where they're required to make quota and the only way to do so is lying/fraud, they willingly turn a blind eye to anyone who lies/commits fraud, they punish people who don't make quota and hold up the liars/fraudsters as exemplars, and punish anyone who tries to blow the whistle on the whole thing.
Which is, by the way, what actually happened at Wells Fargo.
Honestly, the bank probably should've been dissolved for that one, pour encourager les autres.
Considering the size of 'Wall Street' the size of the ethics violations that he uses as an example are miniscule. In addition, due to the increased scrutiny that financial institutions face and the potential damage that scandals can cause, legitimate organizations seem less willing to risk ethics violations.
Also, unlike in war, ethics violations on Wall Street can be reported and prosecuted relatively easily.
As mentioned in many comments above - Wall Street has ethics, one can only hope that the current administration doesn't take steps to weaken threaten these.
Bankers were literally rewarded by the system for being evil.
Many lives and families across the globe were destroyed by their actions -- be it by evictions, loss of pensions and savings that took a lifetime to build and related suicides.
Let us not whitewash all of this stuff.
[1] https://en.wikipedia.org/wiki/Geneva_Conventions
A king not killing another king is moral between kings, but those that followed the loser can suffer greatly. The closer you get to becoming god, the more callous the hands gambled.
The definition of being god here is how effective you are at controlling perceptions, how your followers perceive reality, your personal religion in a way.
So from the peasants view, the kings and gods are corrupt, removed from reality. That is because the god of peasants has always been the god of livelihood, while the elites worship the god of power. The greater god ignores the lesser god.
The military, at the end of the day, is a tool (famously, another tool of diplomacy). Either it's useful or not. Likewise finance is a tool (fundamentally a service industry like gardening or medicine). We support it because it helps finance business, helps people manage their pensions etc. Sometimes sidelines are useful too (DARPA, gun hobbyists, weird financial instruments that increase liquidity for everyone).
Yet lately the ends have been forgotten and the means elevated. The recent US proposed budget suggests increasing expenditures but there is no discussion as to whether that would be useful or not (and thus whether the increase is unnecessary, too big to even too small). The same problem has emerged in Finance: the point of an financial instrument is the instrument itself. HFT that skims a bit out of the transaction (thus is worse for the fundamental buyer and seller) is considered good. etc.
If a teeny-tiny fraction of a percentage or a penny flat tax would cause a trade to not be profitable in expectation, then that trade probably never had anything to do with the real economy in the first place.
We seem to have forgotten that this is governments job and if you go back to first principles and look at government through that lens, I think you end up with the scenario where western governments are failing abd failing badly, government should be both a counterweight again other powerful interests and a referee.
Single issues take far too much prominence (which they want as divisive issues by nature serve to devide people).
Instead of say, Coke being at 194.01 bid and 194.02 ask, that might narrow to 194.012 bid and 194.018 ask. If you trade in that market, you're better off.
The loser is the company previously making the market, which had been buying at 194.01 and selling at 194.02.
There are more complicated ways in which HFTs can indeed be at odds with institutional investors. See e.g. https://www.bloomberg.com/view/articles/2014-03-31/michael-l...
But if they couldn't adjust their price so fast, the spreads would be higher in the first place to account for the risk.
Nobody has the right, or should have the right, to sell a billion dollars in any market without moving the market before it's over. Why should someone take the other side of that trade, knowing the price will crash as soon as it's over?
[0] https://online.wsj.com/public/resources/documents/VirtuOverv...
[1] https://en.wikipedia.org/wiki/Virtu_Financial
The individual investor is unaffected by whether a trade takes a millisecond or 10 seconds. HFT skims from slower market makers, and reduces spreads.
The fact that some "rules" are set so idiots follow them doesn't mean everybody does, specially when they are not seen. Abu ghraib anyone?
Wall street has a very clear ethics set on stone, profits no matter the loss.
If universal adherence were a necessary characteristic of ethical standards, we wouldn't have many that pass that test.
Edit: Abu Ghraib was horrible and the solders should have been sent to prison for the rest of their lives and not just a few years.
Also, I do not support the US military and think that they cause more harm than good in their foreign engagements.
We absolutely did bomb large numbers of civilians in WW2, Iraq, and Vietnam, and in the latter two cases we hadn't even formally declared war.
If you're intending to say that it doesn't, I think you should revisit your conclusion.
Otherwise, these were just examples of war having ethics.
I've got another comment that lays out some historical examples of this [1], but there are plenty more.
[1] https://news.ycombinator.com/item?id=13897486
(In particular, I'm not commenting on whether war should have ethics; I agree that it should. But factually, looking at what belligerents actually do in wartime, it doesn't, at least in any meaningful sense.)
To believe otherwise one must believe in forces of evil that animate one side and forces of good that animate another, which is a profoundly supernatural view.
Similarly, this article suggests that Wall Street lacks morality and uses as an example a VC considering layoffs that would occur if she fails to fund a round.
If there is a finite amount of money, an investor will invest in the firm that shows the most promise. Many teams of hard working people are seeking investment, but only some will get it. The investor must use the available information to decide where to place her bet.
If the investor is wrong, she will not be able to afford to bet again in the future. Should we all fell sorry if the investor makes a bad decision and a team of people spent several years getting paid to pursue an ill-fated idea? Arguably, the cost to society for this misstep is great, so perhaps we ought to appoint a wise investment minister to make the choices judiciously on behalf of investors? Why not also appoint a hiring minister to direct job-seekers only toward the most promising startups? For that matter, why not also appoint a business strategy minister to help startups make good decisions and avoid bad ones?
While these ministerial posts sound absurd in the context of startups, this is our reality in the world of banking and housing. Ministers tell our banks how much reserve capital they ought to carry, they tell our housing market what a reasonable rate is for a 30 year mortgage, etc.
Fannie and Freddie flew under the radar for years without revealing their balance sheet, drastically altering the US (and world) economy all at the behest of a small number of officials. I think the reason this was allowed to occur was (ironically enough) to avoid financial bad news when our leaders were trying to sell a war.
When you introduce socialized risk the market cannot be counted on to prevent socialized losses. The game is changed. The normal incentives and disincentives do not apply.
After 9/11 for example, the government became the insurer of last resort for terrorism related claims. This came as a relief to anyone building a skyscraper or running an airline, but at what cost? It eliminated much of the incentive that would have existed in the economy to prevent terrorism.
We let our ministers create very bad policy. Rather than just writing poor people a check to help them get a mortgage, they create artificial demand for high risk housing loans, which creates a broad incentive for reckless expansion of a whole sector of the economy. They keep much of this risk on the government's books, making taxpayers accountable not for a simple payment to the poor person to allow him/her to get housing, but for the entire house of cards built upon those loans.
We cannot allow our government to try to address so-called "market failures" by creating infrastructure that distorts and hides information from the market. Not only is it paternalistic, but it also creates a tremendous amount of risk for the whole economy.
This is not an argument against welfare. We have two options for how we can think about giving welfare, either as a cash payment (with or without strings attached, fwiw) or by greasing the core infrastructure of the economy to slip in some subprime loans among the many non-subprime loans, figuring that the risk won't really be discernible by financial markets and all will be well.
When capitalism contains a lot of incentives imposed by various government ministers, "free" economic behavior adapts to exploit those incentives. This is what the author of the article disagrees with. He thinks that we should all act gen...
After a few years in drug enforcement the ex drug dealers return to work for their gangs, taking all the knowledge from working in drug enforcement with them, not to mention that they were still receiving dividends and profits from the the drug dealers who previously employed them during their stint in drug enforcement.
I really can't comprehend why any intelligent people can expect this depraved, corrupt farcical system to work. Now you have Trump, unashamedly pro-business (ie leaving the inmates in control of the asylum) and people seriously expect things to get better.
Here are your brave American presidents who can bravely and patriotically authorize the executions (ie murder) of alleged terrorists in Yemen and Afghanistan who have done diddly squat to Americans, but can't/won't a lift a finger against corrupt predatory malign financiers whose actions leave Americans indebted, dying prematurely because they can't afford good housing and good health care. Compare the deaths of Americans due to terrorism by Yemenis or Somalis, and the premature deaths of Americans due to poverty and ill-health which these banksters frauds have worsened, and tell me who Trump should be executing without any meaningful evidence or even a trial.
I am sorry but due to their corrupt financial system the politicians of the Western world are becoming more and more of a joke.
https://www.nytimes.com/2017/03/16/us/international-students...
for this study?
http://www.aacrao.org/docs/default-source/TrendTopic/Immigra...
(see bottom of page 1 in particular.)
Sigh.
Study: 39% of responding instituions reported a decline in international applicatons
Are you complaining about a 1% difference, or the difference between "colleges" and "responding institutions"?
Then in WW2, aside from even more unrestricted submarine warfare and sinkings of hospital ships [2], we also have the firebombings of Dresden, Tokyo, and every other major axis city; machine-gunning of shipwreck survivors in the water; the atom bombs; the impressment of Koreans into service as "comfort women" for Japanese servicemen; forced labor at both axis & allied prisoner camps; the internment of Japanese-Americans in concentration camps; and of course the Holocaust.
Modern-day, there's the My Lai massacre and Obama's attack on a Doctors Without Borders hospital [3]. Probably more too, but you don't hear about them.
The author cites that war has rules because rules are written down, but rules are written down for Wall Street as well. They're just not enforced. And similarly, the laws of war are only enforced on the losing side, or on scapegoats that the actual decision-makers make available as a token sacrifice. When it comes to actually conducting a war, belligerents usually follow just one rule: win.
[1] https://en.wikipedia.org/wiki/List_of_hospital_ships_sunk_in...
[2] https://en.wikipedia.org/wiki/List_of_hospital_ships_sunk_in...
[3] https://en.wikipedia.org/wiki/Kunduz_hospital_airstrike
Hear that a company is going to beat estimates from your friend the accountant at a party and act on it, and you'll get busted for insider trading. Develop a complex algorithm to identify all the other people who are trading on inside information and do what they do, and chances are nobody will figure out what you're doing.
Cheat on your taxes, and you'll get busted for tax fraud. Move earnings through a complex web of offshore subsidiaries in Ireland, Dubai, and the Cayman Islands, and you're technically following the laws of all of those individual countries, but still end up paying less taxes.
Start a pyramid scheme through an e-mail chain letter, and you'll get busted. Start a pyramid scheme by creating a ride-hailing app and bringing on progressively wealthier and more powerful investors, and soon you'll own transportation.
Borrow lots of money on your credit card, and you'll be dealing with aggressive debt collectors for the rest of your life. Borrow lots of money from banks for a series of increasingly more speculative real estate & casino deals, go bankrupt 4 times, start a reality TV show, run for President, and soon you'll own the world.
Hiding bombs under orphans and sick folks is dirty business I recall how much we criticized the Iraqis for doing the same.
Your first post went on at length (and with sources!) about how rules aren't worth anything because they'd be broken anyway. Example: German submarines attacking a civilian ship in WWI.
Unfortunately you missed the most important point in your story - which is that this ship wasn't so innocent and civilian after all. Rather than ignoring the rules, the Germans broke them in retaliation AFTER the Americans had done so first.
The message here is not "rules never work", as your first post implies. It's rather "if you (US) brake the rules, expect the others (Germany) to do so as well in retaliation."
The fact that Lusitania was carrying arms does not support your initial point but rather changes the story and implications entirely.
The point is still about how rules aren't worth anything because they'd be broken anyway. Example: Filling a civilian ship with ammunition.
It doesn't matter who started it first.
The former is a normative statement. The latter is a positive one. A lot of my comments here attempt to describe the world as I've observed it, not the world as I'd like it to be. I have plenty of opinions about how I'd like it to be, as well, but I usually don't share them because opinions are like assholes: everybody has one but thinks that others' stinks.
https://en.wikipedia.org/wiki/Kunduz_hospital_airstrike#U.S....
The amount of moral policing these days is way too much. It seems to have grown significantly these past couple decades.