David X. Li's Gaussian copula function

David X. Li's Gaussian copula function
"Li's formula, known as a Gaussian copula function, looked like an unambiguously positive breakthrough, a piece of financial technology that allowed hugely complex risks to be modeled with more ease and accuracy than ever before. With his brilliant spark of mathematical legerdemain, Li made it possible for traders to sell vast quantities of new securities, expanding financial markets to unimaginable levels." - Felix Salmon

Chicago School of Economics

"By allowing money to flow in the direction of less impedance the invisible hand of the free market effectively balances the economy."

Chicago School of Economics

"The Chicago School bears the blame for providing a seeming intellectual foundation for the idea that markets are self-adjusting and the best role for government is to do nothing." - Joseph Stiglitz

The financial engineers of profit-driven innovation agree that mathematical models of risk simply failed to take into account all of the variables.

According to expert consensus risk models proved myopic.

The financial engineers focused on variables concerned with expected returns and the default risk of financial instruments.

Mathematical models failed to take into account the reality that financial instruments, in the final analysis, must be based on actual assets that actually exist within reality as resources within the biosphere.

Variables neglected include an out of control debt spiral based on never ending growth within a closed finite biological system experiencing catastrophic environmental degradation world wide at a rapidly increasing pace.

Wall Street fabricators of avant-garde financial instruments are actually called "financial engineers."

They got their training in "labs" much like that of Dr. Frankenstein, located places like Wharton, Princeton, Harvard and Berkeley which is based upon the laissez-faire economic ideology of Milton Friedman.

While the old regime, the Reagan-Bush counterrevolution, has lived off the heady vapors of the FIRE sector, it has left in its wake a deindustrialized nation, full of super-exploited immigrants and millions of families whose earnings have suffered steady erosion.

Two wage-earners, working longer hours, are now needed to (barely) sustain a standard of living once earned by one.

And that doesn't count the melting away of health insurance, pensions and other forms of protection against the vicissitudes of the free market or natural calamities." - Steve Fraser 01/08

"In its latest push to compel confidence the authorities are placing enormous pressure on the Financial Accounting Standards Board to suspend "mark-to-market" accounting.

Basically, this means that the banks will not have to account for the actual value of the assets on their books but can claim instead that they are worth whatever they paid for them.

The Treasury, Federal Reserve and SEC all seem to view propping up stock prices as a critical part of their mission - the Federal Reserve sometimes seems more concerned than the average Wall Street trader with the market's day-to-day movements." - Michael Lewis & David Einhorn 01/03/08

"Neoliberal (neocon in America) economists in the last three decades have denied the possibility of a replay of the worldwide destructiveness of the Great Depression that followed the collapse of the speculative bubble unleashed by unfettered US financial markets of the 'Roaring Twenties'.

They fooled themselves into thinking that false prosperity built on debt could be sustainable with monetary indulgence.

Now history is repeating itself, this time with a new, more lethal virus that has infested deregulated global financial markets with 'innovative' debt securitization, structured finance and maverick banking operations flooded with excess liquidity released by accommodative central banks.

A massive structure of phantom wealth was built on the quicksand of debt manipulation." - Henry C. K. Liu 11/15/08

"Until the last year, the biggest growth industry within the US had been the financial sector, producing profits of over $500 billion as late as 2006.

The US has replaced working for a living with the manipulation of money and the extraction of interest, either by lending it or by brokering the lending and investment by foreigners.

In order to enrich themselves, the financiers, with a lot of help from the government, designed the merger/buyout bubble of the 1980s, the bubble of the 1990s, and the housing/equity/hedge fund/derivative bubble of the 2000s." - Richard C. Cook 03/02/09

"Investment banks, like Merrill Lynch, were never subject to the same kind of safety and soundness regulation as commercial banks.

Over the years bank services and bank risks migrated outside of the regulatory safety net.

Wall Street securities firms developed the commercial paper market, which replaced much of banks' short term corporate lending.

Newer market participants, like hedge funds, were not subject to any regulation at all.

Even regulated banks were gradually allowed to own securities and insurance businesses within a holding structure, and they were allowed to hold highly-risky speculative positions in off-balance-sheet "special purpose" entities." - Mark Jickling

Jon Stevens Corzine after earning a MBA from the Chicago School of Economics went on to become a CFO of Goldman Sachs, a US Senator and a Governor of New Jersey.

He made $400 million in the initial public offering of Goldman Sachs.

Corzine helped develop a private sector plan to rescue the hedge fund Long Term Capital Management.

Corzine is a Steering Committee member of the Bilderberg Group.

2011 $1.2 billion disappears like magic from Jon Stevens Corzine investment firm IM Global.

"Corzine's Crime of the Century"

unique library index

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