The amount of human capital that has gone into financial engineering is depressing. Thousands of brilliant minds who are designing complex financial products instead of useful technology.
Renaissance executives agree to pay around $7B to settle dispute with IRS
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Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#42It's always amazing to me how in the world of high profile white collar criminality you can make billions and your punishment is to pay a few percent of it back. I wish ordinary theft worked like this. Steal 500 bucks and your punishment is to return 100.
The IRS can not only give you civil penalties like fines. They can also give you criminal penalties. They also have their own courts where you almost always lose.
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Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#43The amount of human capital that has gone into financial engineering is depressing. Thousands of brilliant minds who are designing complex financial products instead of useful technology.
Prompts one to ask what the incentive is?
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#44At ren tech’s kind of returns it’s literally cheaper to pay the interest and fine than to borrow from anyone else.
Eh. I feel like they can probably get a cheaper loan from somewhere else.
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#45The amount of human capital that has gone into financial engineering is depressing. Thousands of brilliant minds who are designing complex financial products instead of useful technology.
> designing complex financial products
who's to say it wasn't useful? after all, somebody paid for this complex financial products, so objectively speaking, they must have found it useful enough to have paid for it.
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#46Earlier quoted context omitted.
Your figures are sort of backwards. The article claims they saved $6.8B in taxes and will owe $7.7B in fines.
They saved 6.8B seven years ago. If they put that money in broad market index, they already made the fine amount by now and then some.
The discount rate is usually based on a risk free asset. They could have put it in an index and ended up with a 30-40% decline in value as well.
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#47It's always amazing to me how in the world of high profile white collar criminality you can make billions and your punishment is to pay a few percent of it back. I wish ordinary theft worked like this. Steal 500 bucks and your punishment is to return 100.
It's time to tie alll Fees/Fines to 1040 income.
(Patent fees, DMV fees, judicial fines, municipal code citations, school tuition, and even property taxes, etc.)
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#48The amount of human capital that has gone into financial engineering is depressing. Thousands of brilliant minds who are designing complex financial products instead of useful technology.
> designing complex financial products who's to say it wasn't useful? after all, somebody paid for this complex financial products, so objectively speaking, they must have found it useful enough to have paid for it.
No, that isn’t what “objectively useful” means.
Wealthy people pay for this engineering because it helps maintain and increase their wealth. That’s about it. There is zero societal benefit from something like a CDO.
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#49The amount of human capital that has gone into financial engineering is depressing. Thousands of brilliant minds who are designing complex financial products instead of useful technology.
> designing complex financial products who's to say it wasn't useful? after all, somebody paid for this complex financial products, so objectively speaking, they must have found it useful enough to have paid for it.
I mean, they pay for it via salaries, and the people who lose money in the market also pay them.
Re: Renaissance executives agree to pay around $7B to settle dispute with IRS
#50If they did nothing but throw it into a stock market index fund for the last 11 years and compounded it at the standard 8% they would have profited 9 billion dollars. Not a bad way to make a buck. That's at a standard 8%, the stock market returned 9.2% the last 10 years. S&P500 returned ~13%. These guys know what they were doing and were laughing on the way to sign the settlement papers.