Comments on: A beautiful, glorious development

By: Bentnotesmanhisself

Bentnotesmanhisself — Mon, 22 Jun 2009 13:45:48 +0000

And we should have let AIG fail.
The comment that “there are a lot of plans out there” is kind of, well, like saying “There’s a lot of air in the atmosphere today.”
Which ones do you think have merit? Do you find any of them ridiculous? Where do you stand?
You know the BN stance: any of them that involve government are immediate nonstarters.

By: Mr. Dings

Mr. Dings — Mon, 22 Jun 2009 10:50:28 +0000

But here’s a news flash, AIG: You don’t know money.

http://www.fool.com/investing/general/2008/09/17/aigs-failure-is-so-much-bigger-than-enron.aspx

If you did, you’d have realized a few things. Insurance is terribly simple, as long as you follow the Three Rules:

1. Price your risk correctly.
2. Invest conservatively so you can pay out claims when they come due.
3. Don’t do anything else.

Sit back and collect the spread. That’s it, folks.

Seriously, that is it. Ask Warren Buffett, and he’ll probably tell you that if you follow those three rules, you’ll be fine. You won’t be the biggest or fastest grower, but you’ll be absolutely fine.

The problems come when you get greedy and aren’t satisfied with the spread. And your greed can lead to certain actions that aren’t stated anywhere in the rules, including:

1. Diversifying into fast-money proprietary trading.
2. Leveraging your company 11-to-1.

Neither of these is a goal of a well-run insurance company, yet AIG embraced both with open arms.

By: Mr.Dings

Mr.Dings — Sat, 20 Jun 2009 03:22:41 +0000

I stand for Reform means beneficial change, or sometimes, more specifically, reversion to a pure original state.

Reform is generally distinguished from revolution. The latter means basic or radical change; whereas reform may be no more than fine tuning, or at most redressing serious wrongs without altering the fundamentals of the system. Reform seeks to improve the system as it stands, never to overthrow it wholesale.

AIG is the working embodiment of an insurance company that did not work in the free market and was so big it was feared it would bring everybody else down because there was no way it could make good on its bets that the housing bubble would evidently never burst. Big Ponzi scheme, actually.

It indicates above that everybody has a plan for the health insurance fix, including all of the many presidential candidates, as well as your Fred Thompson. Interesting that all would have a plan when the free market is supposed to work here. Wonder what the number of plans has been throughout the over a century of efforts at reform, beginning, say, with TR?

Tobias’ book which was written over 25 years ago demonstrates how far we have come from the execution of insurance as it was conceived to be–all contributing equitable premiums to pay those who suffer losses.

By: Bentnotesmanhisself

Bentnotesmanhisself — Fri, 19 Jun 2009 18:48:34 +0000

What about AIG?
Also, why are you linking to Fred Thompson?
Also, is Tobias’s revelation that a lot of one’s insurance premium goes to marketing some kind of indictment of the whole concept of insurance.
In short, I am once again at a juncture where I have no idea what you stand for.

By: Mr. Dings

Mr. Dings — Fri, 19 Jun 2009 15:23:27 +0000

AIG

By: Mr. Dings

Mr. Dings — Fri, 19 Jun 2009 15:22:52 +0000

But, but, but, what do we do about the invisible ones?

Banks have done more injury to the religion, morality, tranquility, prosperity, and even wealth of the nation than they can have done or ever will do good. -John Adams

By: Mr. Dings

Mr. Dings — Fri, 19 Jun 2009 15:18:56 +0000

You might have more thinking to do on the subject of the law of large numbers and the principles of risk transference and how certain (can’t say greedy here) aspects of capitalism that we practice here enter into the mix. I think I’m on to something: my own peculiar plan. Good gods, the best laid plans of mice and legislators. How many plans are there out there now, on the table. Every candidate had a plan, even your beloved Fred Thompson. http://www.ontheissues.org/2008/Fred_Thompson_Health_Care.htm

I read this Andrew Tobias tome 25 years ago and it had a very formative effect upon me, and I work in the insurance industry. Have you?

Even the author says, “Out of print and out of date. But most of the basic notions remain true.”

http://www.andrewtobias.com/invisible.html

It turns out, the insurance industry — from insuring cars to bridges to Jimmy Durante’s nose — is fascinating. It’s the ultimate casino.

By: Bentnotesmanhisself

Bentnotesmanhisself — Fri, 19 Jun 2009 13:47:30 +0000

Public services such as garbage removal and road-buidling, fire and police are publicly funded and administered because they impact the public at large, not paricular individuals engaging in courses of action of theor own choosing.
In fact, I’ve seen some interesting libertarian arguments for turning a lot of those activities over to the private sector as well.
But if you think there’s an automatic logical leap to government health care, you have some more thinking to do on the subject.
Let’s put it this way, a fireman or police officer is protecting your basic rights – life, liberty, property. A doctor, nurse, pharmacist, or therapist is providing you a service. Whole different category.

By: Mr. Dings

Mr. Dings — Fri, 19 Jun 2009 12:18:05 +0000

As it is, health insurance companies operate like casinos. The house always wins….

By: Mr. Dings

Mr. Dings — Fri, 19 Jun 2009 12:16:01 +0000

Principles? Why it’s only the basic principles of risk transference and the law of large numbers. Insurance is a socialistic idea in the first placeThe free markets have failed us again here, that’s all. I’d think that something that has been on the table for over 75 years and still gathering a thicker head of steam might merit serious reform efforts. And it’s getting it, just that it’s replete with paranoia and invective–par for the course with conservatives whenever you try to change something, i.e., improve it, when the free markets apparently have poor results

http://www.thenewiq.com/integritywatch-blog/what-they-dont-want-you-know-about-capitalism-socialism

Do you believe in emergency services like police, fire, paramedics, military? Emergency services are forms of socialism.

Do you believe in epidemic prevention infrastructures like sewers, garbage removal, water purification, etc? Public health strategies are forms of socialism.

Do you believe in the importance of transportation infrastructure, such as properly maintained roadways, public transportation, and air traffic control? Transportation infrastructure maintenance is a form of socialism.

Do you believe in insurance? Yes, even health insurance, and in fact all insurance, is a form of socialism. Why? Because it spreads costs evenly among everyone in an insurance category even though each individual uses uneven amounts of their health coverage.

These are but a handful of many examples of how socialism is an unavoidable part of democracy-centered republics.