61–70 of 78 posts
https://snbchf.com/2020/02/durden-credit-suisse-md-dies-frea...
Former fund manager here. Wow, this is really interesting. So CS actually knew what risk it was taking, the hypothesis that Archegos had kept its positions private from several lenders is false. They knew what was going on and couldn't ask for more margin, and when they did without a response they couldn't get themselves to just close out the customer's positions. The problem is actually one of internal incentives, f…
Exactly. CS let Archegos get into a position where, if they pulled the funding plug on Archegos, Archegos would go bust. At which point everybody hates everybody.
We changed the URL from https://www.credit-suisse.com/media/assets/corporate/docs/ab... , which is one of those annoying links that downloads a file, and the title from "Postmortem in finance: How Credit Suisse lost $6B [pdf]", which was editorialized. (Please read the site guidelines! https://news.ycombinator.com/newsguidelines.html ) A user suggested the Levine article as a better alternative, so we'll use that for…
Why do you change URLs instead of submitting the one you like instead as a regular user and let upvotes decide? I appreciate and am thankful to the effort you put into moderating HN, but the user did not submit this URL and changing it from under them is super weird, even with a comment explaining it. Not only that you changed it to a paywalled link which is simply bad form.
"Changing [the url] from under them" is standard moderation practice on HN - we do that every day. Ditto for titles. So I'm not sure it counts as "super weird"?
The paywall issue is orthogonal to this one. If there is a workaround, a paywalled URL is ok. If there is no workaround, it's not ok, no matter how "good" the URL is.
We changed the URL from https://www.credit-suisse.com/media/assets/corporate/docs/ab... , which is one of those annoying links that downloads a file, and the title from "Postmortem in finance: How Credit Suisse lost $6B [pdf]", which was editorialized. (Please read the site guidelines! https://news.ycombinator.com/newsguidelines.html ) A user suggested the Levine article as a better alternative, so we'll use that for…
The new URL (at bloomberg) seems to be paywalled. Is there an alternative link?
My question is, how profitable are these services that they can keep losing money on an implosion here and there and still want to be in that business? I guess if the other 99 PB clients are netting you $10B you can lose some to Malachite Capital Management and Archegos now and then.
Former fund manager here. Wow, this is really interesting. So CS actually knew what risk it was taking, the hypothesis that Archegos had kept its positions private from several lenders is false. They knew what was going on and couldn't ask for more margin, and when they did without a response they couldn't get themselves to just close out the customer's positions. The problem is actually one of internal incentives, f…
couldn't get themselves to just close out the customer's positions. Exactly. CS let Archegos get into a position where, if they pulled the funding plug on Archegos, Archegos would go bust. At which point everybody hates everybody.
Earlier quoted context omitted.
>Another PB I worked with had a similar issue. A high rolling Gulf guy came in, wanting to do big FX trades on little margin. Risk said no, boss overruled them. Dude blew up, PB lost a lot of capital, boss got fired. I used to work in finance but quit. The industry is still by far driven by mostly by sales/relationships/politics. It seems like in this case the right person got fired. I knew of a trader on a credit de…
Any idea how they got away with this?
> Notably, this is not a situation where the business and risk personnel engaged in fraudulent or illegal conduct or acted with ill intent. Nor is it one where the architecture of risk controls and processes was lacking or the existing risk systems failed to operate sufficiently to identify critical risks and related concerns. The Archegos risks were identified and were conspicuous. The persistent failure of he busin…
My question is, how profitable are these services that they can keep losing money on an implosion here and there and still want to be in that business? I guess if the other 99 PB clients are netting you $10B you can lose some to Malachite Capital Management and Archegos now and then.