
Lie More, as a Business Model - spsaaibi
http://economix.blogs.nytimes.com/2012/07/05/lie-more-as-a-business-model/?smid=tw-share
======
moocow01
I used to buy into the MBA mentality.

Now I really think MBA / todays managerial wisdom is slowly destroying the
world. The business climate in most corporations is plain awful and most
people don't even realize because they don't know what a healthy business
environment looks like.

It seems that these days that as long as your numbers on your spreadsheet
match up, it doesn't matter how you got them to match just as long as they
match up somehow. Lying is just one of the many unethical techniques that are
now common tools to deliver shareholders "value".

~~~
mathattack
This isn't about spreadsheet crunching, or even shareholder value. It's about
personal incentives - unlimited upside, limited downside, and no concern on
the ethics involved.

~~~
yuhong
Yea, the wrong incentives can be worse than no incentives at all.

------
leot
Don't worry, in the "long run" the laissez-faire approach to corporate
regulation will "end up" minimizing malfeasance and maximizing freedom.
Liberty just needs more time. Like, say, another year. Two, max.

~~~
anonymoushn
I'm not sure that providing subsidies to large banks and refusing to enforce
the law when they commit crimes is a laissez-faire approach to corporate
regulation.

~~~
ubernostrum
Enforcing a law? You mean a law regulating business?

 _gasp_

Someone fetch the smelling salts, I think I may faint!

~~~
nuaccnt
This is the discourse equivalent of going to a party, pulling your pants down
in the living room and taking a shit on the floor.

------
shaggyfrog
The title of the linked piece is "Lie More, as a Business Model", and serves
just fine as a headline for Hacker News. Not sure why the headline was turned
into a linkbait question instead.

~~~
theorique
They lied.

------
speedracr
NPR's Planet Money has devoted a 20min episode to explain the LIBOR
manipulation - worth a listen if you want to brush up on your interbank
financial knowledge.
[http://www.npr.org/blogs/money/2012/07/03/156222428/episode-...](http://www.npr.org/blogs/money/2012/07/03/156222428/episode-384-the-
little-lie-that-rocked-the-banks)

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pcrh
What is probably unsurprising, but should have been expected, is that banks
and major business interests got seriously upset when they found that they
were _lying to each other_.

Clearly the earlier financial upsets, which were caused by them lying to the
public, were not _really_ their fault.

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ebrenes
Hasn't it always been a fairly well established business model? If anything
the success of this model means we're seeing it more and more in ever more
gigantic failures. Whereas before it seemed confined to snake oil salesmen and
politics...

~~~
mey
I have a bridge I'm looking to sell.

~~~
mc32
Not to mention "snake oil" liniments and other forms of quackery.

~~~
dredmorbius
Obligatory: _real_ Chinese snake oil _is_ a valid cure.
[http://www.scientificamerican.com/article.cfm?id=snake-
oil-s...](http://www.scientificamerican.com/article.cfm?id=snake-oil-salesmen-
knew-something)

The problem then (as now) was charlatans claiming similar properties from
substances which lacked the original's active ingredient: high Omega-3 oils.

I see this as the fundamental _Zen and the Art of Motorcycle Maintenance_
problem: what is quality, and how does one identify it?

~~~
wmil
And the "Snake Oil" being sold in the US wasn't quackery. It was typically a
combination of alcohol, morphine, and/or cocaine.

People weren't stupid -- it definitely made them 'feel better'.

------
MaysonL
Google "municipal bond price fixing" for another big ripoff the banks have
been running...

~~~
joezydeco
...or "Deep Capture" for another example.

------
bootload
_"... Today’s banks represent the incarnation of profit-seeking behavior taken
to its logical limits, in which the only question asked by senior staff is not
what is their duty or their responsibility, but what can they get away with.
..."_ Martin Wolf, FT.

No, as long as the money kept rolling in, a blind eye was turned to the kind
of behaviour described. Hard times has changed what is acceptable practice.

------
vwoolf
Lying is a business model for too many businesses; I'm reminded of Go Daddy's
wholly-owned subsidiary, Standard Tactics, and how the latter would register
expired domains, while Go Daddy would volunteer to "negotiate" with itself
(see the whole account here: [http://domainnamewire.com/2008/12/03/standard-
tactics-llc-ho...](http://domainnamewire.com/2008/12/03/standard-tactics-llc-
how-godaddy-profits-from-expired-domains/) ).

It's very hard to fight this sort of thing, as an individual, much like it's
hard to avoid Barclay's (or its larger competitors, like Bank of America or
Chase).

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larrys
The press is the watchdog of things like this.

Unfortunately the press has been gutted and all the old white men with years
and years of experience have left being replaced by people like Catherine
Rampell (attractive, young, and only 5 years out of Princeton).

This is not a rant against woman (I've seen this pattern with both young men
and young woman) and it's not a rant against young people (there are some
areas where you want a young person personally I don't feel that economics
(while not brain surgery) is one of them).

<http://www.linkedin.com/in/catherinerampell>

[http://topics.nytimes.com/top/reference/timestopics/people/r...](http://topics.nytimes.com/top/reference/timestopics/people/r/catherine_rampell/index.html)

Here is Catherine on TV:

<http://www.c-spanvideo.org/program/300818-6>

Most interesting is that she actually founded the economics blog 1 year out of
Princeton.

Edit: Not to mention the money to keep an eye (and hire experienced people) is
also not there anymore, not supported by legacy advertising monopoly.

~~~
guelo
I'm really confused by your rant on a story that is not about journalism and
is being reported by Simon Johnson who is one of the "old white men" you seem
to prefer. You use the weak link of "The press is the watchdog" and then pivot
into an ad-hominem attack against a reporter that has nothing to do with this
story and that you apparently know a lot about for some reason. It's kind of
weird.

~~~
larrys
"rant on a story that is not about journalism and is being reported by Simon
Johnson"

Johnson is the real deal I have no issue with him obviously.

Catherine Rampell is founding editor of the Economix blog.

"ad-hominem attack against a reporter" It's an attack against the New York
Times the paper of record not Catherine.

"has nothing to do with this story" afaik she decides what gets onto the blog
or not. She is the gatekeeper.

"you apparently know a lot about for some reason"

Not really. Just what I've linked to. Took a second to do the links after a
search.

"It's kind of weird."

Why?

Edit: I might add also I love people who imply someone isn't being nice to
someone "ad-hominem" by not being nice ("it's kinda weird")

------
orangethirty
I've been searching for a business co-founder for a while, and this is one of
the things that turn me off about some business people. They seem to believe
that a business is built with Hype and not a real product. Sure, that is how
you might get some funding, but its not how you build a sustainable business.

------
billrobertson42
This is not new. Fabrication was one of the factors leading to famine during
the great leap forward.
[https://en.wikipedia.org/wiki/Cultural_Revolution#Great_Leap...](https://en.wikipedia.org/wiki/Cultural_Revolution#Great_Leap_Forward)

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nerd_in_rage
hasn't lying has always been a business model?

~~~
dredmorbius
It's been a business _practice_ , certainly. And it's been part of law and
lore since the dawn of history. The code of Hammurabi includes punishment for
false witness: <http://www.jstor.org/stable/3153879?origin=JSTOR-pdf>

In Dante's _Inferno_ , the penultimate (8th) circle of hell is for the
fraudulent (the 9th and innermost is for traitors -- another form of fraud, if
you like): <http://www.wolfram.demon.co.uk/rp_dante_hell.html>

------
vibrunazo
There's a better euphonic marketing jargon for "lying". It's called
"marketing" :)

------
patrickgzill
"This way to the Egress => "

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portentint
BECOMING a business model?

The liars tend to win, because they make the superior claims. And for whatever
reason, the customers can't give up on the idea that maybe this ONE outrageous
promise, this ONE time, is actually for real.

It's like playing the lottery: Statistically you're better off running outside
and screaming "THROW MONEY AT ME". But people still play.

~~~
jaggederest
> running outside and screaming "THROW MONEY AT ME"

On Sand Hill Road, these days, that seems to work.

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yashchandra
You mean officially ?

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eragnew
For large banks, it has been for a while. #justsayin

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Spooky23
Obviously the author of this article is a socialist... The financial industry
is driving innovation by applying the principles of capitalism.

The only reason the bankers are lying is that government meddling is making
their capitalistic process illegal. Of you want bankers to be 100% truthful,
don't tie their hands behind their backs with quaint concepts like usury,
proper underwriting of loans, etc.

~~~
sophacles
The poe factor or this post approaches 1. I am either frightened or in
stitches... I'm not sure which.

