tag:blogger.com,1999:blog-31671374.post3372068975127920654..comments2023-10-30T07:10:34.610-07:00Comments on Underbelly: BGO: This Tunas's Not for Eating, It's for Buying and SellingBucehttp://www.blogger.com/profile/16452321114185736762noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-31671374.post-21384871889208634862011-03-16T13:40:29.779-07:002011-03-16T13:40:29.779-07:00(8) Point four means we've attracted the shark...(8) Point four means we've attracted the sharks. Points five and six mean corporate finance became more complex. Point seven means leverage increased. Guess where these lead.......Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31671374.post-33153643317277306912011-03-16T13:36:58.461-07:002011-03-16T13:36:58.461-07:00(7) Increased leverage at the individual, governme...(7) Increased leverage at the individual, governmental, and probably corporate level.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31671374.post-22608585744268551522011-03-16T13:35:18.751-07:002011-03-16T13:35:18.751-07:00(6) With the EMH and MPT came a growing demand for...(6) With the EMH and MPT came a growing demand for eggheads (rocket scientists, if you please) to apply quantitative methods to Wall Street products. Fisher Black co-authored the seminal work on stock options in 1973 (that fits nicely into your 40-year period). He left academia and joined Goldman Sachs in 1983.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31671374.post-72990869176167205072011-03-16T13:31:13.960-07:002011-03-16T13:31:13.960-07:00(5) The slow acceptance of Modern Portfolio Theory...(5) The slow acceptance of Modern Portfolio Theory and its brethren, e.g., the Efficient Market Hypothesis.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31671374.post-25922460098412603792011-03-16T13:30:05.320-07:002011-03-16T13:30:05.320-07:00(4) Like throwing chum at a school of sharks, the ...(4) Like throwing chum at a school of sharks, the sharply increased compensation attracted increasingly greedier people to Wall Street.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31671374.post-74247075665598840872011-03-16T13:27:46.291-07:002011-03-16T13:27:46.291-07:00(3) Misguided efforts by Congress and institutiona...(3) Misguided efforts by Congress and institutional investors to control executive compensation by capping salaries, which led to the extensive use of stock options during the greatest bull market in American history. This perversely INCREASED executive compensation, thereby redefining normal compensation levels in boardrooms and on Wall Street.Anonymousnoreply@blogger.com