But an even more emphatic message needs to be sent to UBS by its prudential regulator in the U.S.: You are finished in this country. We are padlocking your Stamford, Connecticut, and Manhattan offices. You need to pack up and leave. Now.
American schoolchildren are protected by building codes that govern stairways and windows. School buses must meet safety standards, and the bus drivers have to pass tests. Cafeteria food is regulated for safety. The only things we seem lax about are the things most likely to kill.
The Occupational Safety and Health Administration has five pages of regulations about ladders, while federal authorities shrug at serious curbs on firearms. Ladders kill around 300 Americans a year, and guns 30,000.
No one wants to send a 13-year old genius who loves Harry Potter and his snuggle animal collection to jail. But our society, with its stigma on mental illness and its broken healthcare system, does not provide us with other options. Then another tortured soul shoots up a fast food restaurant. A mall. A kindergarten classroom. And we wring our hands and say, “Something must be done.”
On that gray Nov. 7 in 1926, there was no indication that the short 29-year-old man who walked with a limp and had just stepped off of a train at Berlin’s Anhalter Station would shape the destiny of the German capital.
I asked the Smart Jews what they thought and came away having to admit that they were indeed very smart. You can think about this trial in two ways, they said. One way is narrow: it’s about ascertaining the technical nature of a business relationship. The other way is broad: it’s about righting the pathological ways in which a particular society has organized itself.
The trouble is, derivatives rules are weaker or nonexistent elsewhere, making the call for substituted compliance either a tactic to delay enforcement until the rest of the world updates its regulations or, worse, an attempt to avoid tough regulation altogether.
ABN Amro had “employed two former employees of S&P” to learn the agency’s methods, the judge said. It knew, for example, that for S&P to give the derivatives the top rating, its models had to show a likely default rate of less than 0.728%.