Harriet Harperson—bigoted and wrong
Asked whether the financial crisis would have arisen if more women had been in senior positions, Ms Harman referred to the US bank that collapsed and prompted international turmoil.
"Somebody did say... that if it had been Lehman sisters rather than Lehman Brothers then there may not have been as much," she told GMTV.
Riiiight. So, can I look forward to this fucking evil little witch eating her own words?
"What?" I hear you cry.
As you may know, one of the very dodgy financial instruments that brought the whole banking system crashing down was the Credit Default Swap (and these have made it particularly difficult for the banks to assess precisely how much debt they are holding, and the quality of that debt).
And now, via @gareth_e_clark, it seems that it was a woman who invented these jolly little bundles of fun.
You won't find her on Fortune's list of the 50 Most Powerful Women in Business but Blythe Masters may go down in history as the woman who is responsible for the 2008 collapse of global financial markets. You can't get more powerful than that.
When I started researching credit default swaps --the financial vehicle that Blythe Masters is credited/blamed for inventing and which Warren Buffet described in 2003 in his annual letter to shareholders as "financial weapons of mass destruction", my image of its originator was definitely not pink.
So sure was I that the culprits were testosterone-driven venture capital types that before I had the facts I had already begun my mental argument of why a woman would never have come up with a scheme that could bring global markets to their knees.
So much for fact-less based arguments.
As recently as September, Ms. Masters was defending the credit default swaps in an email exchange with The Guardian."I do believe CDSs [credit default swaps] have been miscast, much as poor workmen tend to blame their tools."
NC Painter has a short article written by Blythe Masters in 1997 where she describes how the credit default swaps will revolutionize banking. NC Painter added the bold italics.By enhancing liquidity, credit derivatives achieve the financial equivalent of a free lunch, whereby both buyers and sellers of risk benefit from the associated efficiency gains."
Ms. Masters obviously isn't a devotee of TANSTAAL—"There Ain't No Such Thing As A Free Lunch,"—an acronym made popular in the 1966 novel The Moon Is a Harsh Mistress, which, according to Wikipedia, discusses the problems caused by not considering the eventual outcome of an unbalanced economy.
Oh dear. It looks like Harridan Harperson needs to shut the fuck up and crawl under a rock somewhere and die. I mean, obviously I thought that was the case before I stumbled across this little gem, but this has merely strengthened that feeling.
Bugger off, Harperson, you bigoted, sodding loon.
P.S. HowStuffWorks has a rather interesting way of describing how Credit Default Swaps work. Or, rather, what happens when they don't.
Imagine that you could purchase your friend Jimmy's health insurance policy from the company that issued it. Everything's going smoothly; you're raking in the dough as Jimmy makes his monthly payments. But things take a sudden turn for the worse after Jimmy's legs are crushed in a car wreck. Jimmy can't afford the healthcare costs, but luckily he's insured—by you.
You find nothing but cobwebs in your savings account and realize that you can't pay for Jimmy's health care. Jimmy's still insured (he's faithfully made his premium payments), so who pays the hospital bills? The insurance company sold the policy to you, and you owned it when Jimmy's accident happened. You were caught with the hot potato.
Jimmy's hospital realizes his insurer won't cover his costs and releases him, but he still requires care. So Jimmy sues you to pay up, but you just blew all of your money completing your collection of Pat Boone albums, which suddenly doesn't seem like such a good investment. Even worse, a trove of Boone's albums was discovered in the estates of some recently deceased collectors, and the market value of your collection plummets. You sell the collection for half of what you paid for it and put it toward Jimmy's health care costs, but it's a drop in the bucket. Ultimately, you're forced to declare bankruptcy.
Yup, that's as clear an explanation as I've seen.