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Another Helping of Link Salad
Mar. 18th, 2010 09:59 amVarious links with commentary:
A) One of the reasons I am in favor of the current health care bill is that it forbids the practice of "rescission" - canceling somebody's health insurance policy after they get sick. As documented here, some insurers were making it a point to deliberately drop customers (in this case all HIV patients) because they were too expensive. Fortunately, the company in question violated multiple laws, resulting in a multi-million dollar fine against them, but the damage, including premature death, is obvious. Also obvious are the strong incentives and conspiratorial practices currently in place - practices that go away immediately after the bill passes.
B) Like most people, I've heard of firms "to big to fail" (TBTF) so many times that I'm sick of it. But the problem isn't that the firm is TBTF, the problem is that normal bankruptcy processes are too slow. If you are a depositor in a TBTF firm, having your working cash tied up for months in court is a disaster. Thus, the best part of the new financial regulation bill is resolution authority. The key quote: This is why we have the FDIC. It doesn’t prevent banks from failing. But it establishes a mechanism other than bankruptcy for dealing with a bank failure.
C) Amazon is sending me the book The Big Short:
, about the recent financial collapse and various people who saw it coming, sent out warnings, and made money betting it would happen. This excerpt, entitled "Crapping Out At the Subprime Casino" is a reason why I ordered it. Go read the whole thing.
D) Another interesting book (so many books, so little time!) is Son of Hamas. It's the memoirs of the son of one of the founders of Hamas. The son converted to Christianity and became an informant for the Israeli secret service! Click on the link to read an interview with the author.
E) Edit to add: Don't believe any of this bullshit about a "deeming resolution is unconstitutional." It's actually more commonly called a self-executing rule, and has been done in the House since the 1930s. Basically, the House combines two votes (Senate bill and their fixes) into one. The Senate still has to vote on the House fixes, but that's a simple majority vote.
A) One of the reasons I am in favor of the current health care bill is that it forbids the practice of "rescission" - canceling somebody's health insurance policy after they get sick. As documented here, some insurers were making it a point to deliberately drop customers (in this case all HIV patients) because they were too expensive. Fortunately, the company in question violated multiple laws, resulting in a multi-million dollar fine against them, but the damage, including premature death, is obvious. Also obvious are the strong incentives and conspiratorial practices currently in place - practices that go away immediately after the bill passes.
B) Like most people, I've heard of firms "to big to fail" (TBTF) so many times that I'm sick of it. But the problem isn't that the firm is TBTF, the problem is that normal bankruptcy processes are too slow. If you are a depositor in a TBTF firm, having your working cash tied up for months in court is a disaster. Thus, the best part of the new financial regulation bill is resolution authority. The key quote: This is why we have the FDIC. It doesn’t prevent banks from failing. But it establishes a mechanism other than bankruptcy for dealing with a bank failure.
C) Amazon is sending me the book The Big Short:
, about the recent financial collapse and various people who saw it coming, sent out warnings, and made money betting it would happen. This excerpt, entitled "Crapping Out At the Subprime Casino" is a reason why I ordered it. Go read the whole thing.D) Another interesting book (so many books, so little time!) is Son of Hamas. It's the memoirs of the son of one of the founders of Hamas. The son converted to Christianity and became an informant for the Israeli secret service! Click on the link to read an interview with the author.
E) Edit to add: Don't believe any of this bullshit about a "deeming resolution is unconstitutional." It's actually more commonly called a self-executing rule, and has been done in the House since the 1930s. Basically, the House combines two votes (Senate bill and their fixes) into one. The Senate still has to vote on the House fixes, but that's a simple majority vote.
