Science in Finance IV: The Feedback Effect Paul Wilmott (hat tip jhttp://www.aleablog.com/links-4/ck). A nice short piece that helps in responding to zero sum arguments (“oh, it really isn’t so bad if prices fall, after all there was someone on the winning side of those trades.” That ignores the fact that those trades at the margin affect the perceived value of the aggregate outstanding).
The Nation of One Cassandra Does Tokyo. From a couple of days ago and very well done.
Small Law Firm’s Big Role in Bundling Mortgages New York Times. The old guard securities law powerhouses like Sullivan & Cromwell, Davis Polk, and Sherman & Sterling must be viewing this as just deserts. Hire a novice and you get what you pay for.