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I don’t normally advertise new blogs, but this one looks like it is worth a look. It looks like “nzriskmanager” is going to develop into a useful resource. Give it a go.
Putting together a blog cavalcade was an interesting task – and one that took a fair bit longer than I expected. Not, I might add, because it was a painful one, but because there was so much to read and so much that I had not covered – focussing as I do on banking with the occasional foray into insurance along with the occasional amateur foray into economics.
The quantity of posts on health that were submitted was interesting. Living in Australia the issue of health insurance is not a big one. The idea of being bound to an employer’s health plan is an interesting one, so the issues that arise from this – in particular where the employer has to choose a plan caused me to think carefully. While this post read a little like an advertisement for “Best Doctors” I did have to stop and think.
Being a little late, as I am, in posting this at least let me look at the latest stff out there. One post from the Cav’s organiser (Henry Stern) just popped up with a question about the US health system and where it is headed. Given how much you guys in the States are paying I am not surprised you are looking at alternatives, but, to (hopefully correctly) paraphrase where Henry is going, just because you need a change and that what is proposed is a change does not necessarily mean that the change that is proposed should be adopted.
To go with the slightly Australian flavour, though I should note a recent controversy over here – whether midwives should be able to attend home births and be covered by insurance for doing so. To me, it flows on to the question in the next section – whether perceptions of risk become the guiding methodology, rather than the facts of the matter. This is backed up by a piece from Colorado on home births.
I found this post, while short, on risk response to be interesting – why do we sometimes respond to risk in an illogical way, taking the “safe route” rather than the one that is more likely to give the desired outcome? Perceptions of risk are often, but not always, wildly different to the actuality.
One of the warnings I received on agreeing to do the Cav was against posts on credit cards. Sorry – but I will have to make one exception. This one talks about the popularity of credit card default insurance – and why you probably do not need it. This has always been my perception of this type of insurance, so I thought it should be added to.
The TARP bailout has been fairly big news all around the world, with the US government pumping huge funds into the banks. I have always been a skeptic on this sort of action, but some hard data can cause me to rethink. I am not persuaded as yet, though.
One possible option for the future was canvassed on BankWatch – make the banks a lot safer than the current ones. I am not sure exactly how to enforce it, but it is a good thought.
To get through all this, some general advice is sometimes handy – this post gives some very general advice on possible strategies. I particularly liked the last one on sorting out an exit strategy. It is always a good idea to have a backstop. More advice comes from the Digerati Life – and again, the last one is the money quote. If you are thinking of trading it is worth a read.
I can’t leave without giving a little plug to one of my favourite bloggers in Kenya – Bankelele. His series on the use of mobile phones to make payments in Kenya has been very interesting.
Given this is a risk cavalcade, I was surprised that there was so little (read: nothing) on general or life insurance submitted. Other than health insurance, there does not seem to be a lot out there. Perhaps readers can direct me to some useful ones in comments? Perhaps a brief look at an alternative may help.
To sum up – thanks to Hank for the oppotunity to do this. It was certainly interesting.
Just a quick note that Ozrisk will be hosting the next Cavalcade of Risk. If you can think of any blog posts on the area of risk management and believe they deserve a bigger platform, feel free to submit the post using this form.
Note, though, that submission does not guarantee publication.
The current edition is here.
It’s good to know that I am not the only one looking at this proposal and not knowing whether to laugh or cry. The post titled “A Mighty Wind” over at The Dealmaker’s blog is well worth a read. Just watch it though – the language is not entirely worksafe.
There are some great quotes in there:
Forget the no doubt significant fact that substantial portions of the Administration’s regulatory proposals were authored by products of a government-to-industry-to-government merry go round like Hank Paulson, Larry Summers, and Tim Geithner. Forget the fact that the Administration is said to have consulted heavily with industry participants and lobbyists for input on proposed regulations. No, what really matters at the end of the day is that the Commodity Futures Trading Commission is overseen by the House and Senate Agriculture Committees.
But investment bankers adapt. Change is the water we swim in, the air we breathe. We will adapt to whatever stupid new regulations and incompetent, undertrained, overmatched new regulators you throw at us. And we will come out on top, as always.
It’s just too bad we’re gonna have to charge you extra for the added headache.
Classic. The important points though, are entirely valid – even that
last one that comes across as a smirk. Every regulation costs money to
comply with and that has to come from somewhere. I can guarantee you
that they are not going to be paying the people less as they need more
to comply with the regulations – and more smart people to work out the
best way to do so. The shareholders need to be compensated more for the
increased risk of investing. The buildings will not cost less.
The people who pay for all this are the depositors and borrowers – i.e. you. Oh – and the taxpayers. Oops – you again.
I will be adding this one to the blogroll.
If you want to have a look at a near final draft of the proposed changes, it is here. I understand this is the one most people are working off.
Another opinion is here. As this one is a Reuters blog, it is much cleaner. There are, for example, no uses of the “f” word.