i swear i approached today's david brooks column with a somewhat open-minded stance. everyone knows i hate him and that i think he makes no sense...pretty much EVER, but i told myself today: i'm going to take a deep breath before i start silently screaming.
he begins the column by delineating two ways we can talk about the recent and ongoing turmoil in the markets: the greed narrative or the ecology narrative. oooookay. i'm not sure whether he came up with these brilliant names himself, but the hostile nature of the first moniker vs the benign, almost warm & fuzzy image invoked by the second pretty much lets me know which one he prefers.
he gives a scant two paragraphs to the so-called "greed narrative", using inflammatory and over-the-top descriptions like, "absurdly overpaid zillionaires" and "obscene bonuses". apparently all those who express any cynicism or disdain for how the market has been operating of late are sugar high teenagers. don't describe paul krugman that way. please.
then he moves on and devotes thirteen paragraphs on his "ecology narrative", with sweeping generalizations like "Everyone seeks wealth while minimizing risk" and "The U.S. has enjoyed 25 years of strong economic growth". not to mention, apologizing for the recent volatility in the markets with this type of benign and naive explanation:
Most of the time, the complex new instruments diversify risk and serve the public good. But life requires trade-offs, and, as we’re being reminded this week, the innovation process involves a painful adolescence.
When a new instrument enters the market, it takes a while before people understand and institutionalize it. Whether the product is high-yield bonds or mortgage-backed securities, there’s a tendency to get carried away.In the first stage of this adolescence, investors look around and see everybody else making money off some new instrument. As Nicholas Bloom of Stanford notes: “They assume they are fine because they see everyone else buying it.”
indeed, i think mr. bloom is describing GREED. as in, thinking only about their own gains and not about any of the possible consequences of their actions. if i can withhold my anger and use david brooks' jargon, the so-called "greed narrative" is merely a subset of his genteel "ecology narrative". anyway, brooks' basic stance, surprise, is that the government shouldn't do anything to intervene because that just hampers innovation in the financial markets. and tsk tsk, these guys just got "carried away"! don't reprimand them and don't attempt to change the status quo. following his whole adolescence into maturity metaphor, what type of overzealous adolescent reigns in his/her behavior without some supervision and/or discipline? on that note, i'd like to meet his kids.