Wall Street’s Advice to the IMF: Control Your Alleged Rapists!

We are outraged by your lack of empathy for your victims! We’re not talking about the targets of your sexual advances, of course. We mean us.

You’re supposed to be bailing out trading partners, bankers in weak foreign countries bankrupted by bailouts. Remember, you pigs are supposed to be financially raping the citizens of the PIIGS (Portugal, Italy, Ireland, Greece and Spain). We’ll get back to that shortly, but first we have to address some housekeeping.

Jeopardizing Our Health

Condoms aren’t foolproof, and HIV doesn’t care how much you paid for a hooker in Thailand. It has come to our attention that you have allegedly been customers of our New York based suppliers of prostitutes, and we’re furious.

We need you to stick to the job. Moreover, if you had just listened to our advice to Joran van der Sloot, you wouldn’t be caught allegedly doing anything in the wrong place at the wrong time.

Targets Can Shoot Back

As for the handling of your internal matters, it was a nice touch to call newly resigned IMF head and alleged sex offender Dominique Strauss-Kahn’s 2008 affair with a subordinate a “serious breach of judgment” and impose no real consequences. It was a great move to reportedly decline investigations and consequences for other managers involved in suspect activities. It’s well known that a permissive atmosphere enables harassment (and more) and dismays the targets who perceive they will get no support. This is exactly the kind of thing we do all the time, but you have to save all this good stuff for your next high profile job in finance or politics.

Until now, your internal targets felt so intimidated you were able to sweep all this under the rug. You can’t count on that anymore with all the new publicity you’ve brought on yourselves.

Targets have caught on that they have nothing to lose and at least can gain back the self-esteem you’ve tried to destroy. Targets’ careers are already embattled, so it is in their interest to take action, and they’re not going to apologize for standing up for themselves.

Moreover, it’s a snap to see through the flaws in the IMF’s new “policy.” You say that when it comes to intimate relationships, you will investigate if there is evidence of harassment. Obviously, the complainer will have to produce the evidence. But how has letting you handle things worked out so far for targets?

Targets will never buy that nonsense now. They’ll tell you to stuff it and act independently. Targets have a right to treat this as a matter of personal safety. When it comes to the topic of their personal safety, you have nothing to add.

The IMF Can’t Even Negotiate “Consensual Sex”

Even when sexual relations between your bosses and subordinates apparently begin as consensual, the IMF inspires targets to rebel. According to the New York Times: “One woman is said to have slept with her supervisor, who then gave her poor performance reviews to pressure her into continuing with the relationship.”

We must point out that if you want someone to continue a sexual relationship, tell them their performance was great. In the battle of the sexes, he declared thermonuclear warfare!

Remember Whom You’re Supposed to Be Screwing

This may sound as if we’ve developed a conscience, but don’t worry, we haven’t. The truth is that we need you do as we say and not as we do for a change.

We need you to keep bailing out weak countries like Ireland. Many of Ireland’s bankers fled the country, and the people of Ireland are drowning in their debt.

We love the way the IMF forced a loan on the Irish to pay off the government debt that was forced on them to pay off the bankers’ debts. To get the bailout loan, the Irish government had to slash spending, lay off tens of thousands of public workers, lower wages, increase taxes, and cut health care budgets. The bankers got away with financial murder, and the citizens are paying for it, just the way we like it.

Instead of letting banks fail or restructuring banks, we need you to do the same thing to Greece and possibly other countries, too. The Greeks are already protesting: “We’re not Ireland!” Your recent scandals may encourage them to get even more insistent and come up with an alternative of their own.

We do lots of business with these foreign banks and governments. So stop spending so much energy trying to screw each other and spend it screwing the citizens of countries with governments that need bailouts because they bailed out bankers.

Clean up your act, so that we don’t have to clean up ours!

Janet Tavakoli is the president of Tavakoli Structured Finance, a Chicago-based firm that provides consulting to financial institutions and institutional investors. Ms. Tavakoli has more than 20 years of experience in senior investment banking positions, trading, structuring and marketing structured financial products. She is a former adjunct associate professor of derivatives at the University of Chicago’s Graduate School of Business. Author of: Credit Derivatives & Synthetic Structures (1998, 2001), Collateralized Debt Obligations & Structured Finance (2003), Structured Finance & Collateralized Debt Obligations (John Wiley & Sons, September 2008). Tavakoli’s book on the causes of the global financial meltdown and how to fix it is: Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street (Wiley, 2009).

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About Janet Tavakoli 34 Articles

Affiliation: Tavakoli Structured Finance, Inc.

Janet Tavakoli is the founder and president of Tavakoli Structured Finance, Inc. (TSF), a Chicago based consulting firm providing expert experience and knowledge about maximizing value in the capital markets in the face of complexity and uncertainty. TSF provides consulting services to financial institutions, institutional investors, and hedge funds.

Ms. Tavakoli was years ahead of the financial industry predicting lax underwriting and misrating of structured financial products would result in the collapse of the global credit bubble. She also predicted the collapse of the thrift industry, Long Term Capital Management, and First Alliance Mortgage prompting Business Week to profile her as "The Cassandra of Credit Derivatives." [2008].

Ms. Tavakoli pointed out grave flaws in the methodology for rating structured financial products in her books, Structured Finance & Collateralized Debt Obligations (2003, 2008), and Credit Derivatives (1998, 2001). She wrote the first letter the SEC posted in February 2007 in response to its proposed rules for the credit rating agencies; she made the case that the NRSRO designation for the rating agencies should be revoked for structured financial products.

Ms. Tavakoli is frequently published and quoted in financial journals including The Wall Street Journal, The Financial Times, Business Week, Fortune, Global Risk Review, RISK, IDD, Chicago Tribune, Los Angeles Times, LIPPER HedgeWorld, Asset Securitization Report, Journal of Structured Finance, Investor Dealers' Digest, International Securitization Report, Bloomberg News, Bloomberg Magazine, Credit, Derivatives Week, TheStreet.com, Finance World, and others.

Frequent television appearances include CNN, CNBC, BNN, CBS Evening News, Bloomberg TV, First Business Morning News, Fox, ABC, and BBC.

Tavakoli is a former adjunct associate professor of finance at Chicago Booth (the University of Chicago's Graduate School of Business) where she taught "Derivatives: Futures, Forwards, Options and Swaps".

Janet Tavakoli is the former Executive Director, Head of Financial Engineering in the Global Financial Markets Division at Westdeutsche Landesbank in London. She headed market risk management for the capital markets group for Bank One in Chicago. Tavakoli headed the asset swap trading desk at Merrill Lynch in New York, headed mortgage backed securities marketing for Merrill Lynch in New York, and headed mortgage backed securities marketing to Japanese clients for PaineWebber in New York. She also worked for Bear Stearns heading marketing for quantitative research.

She is the author of: Credit Derivatives & Synthetic Structures (1998, 2001), Collateralized Debt Obligations & Structured Finance (2003), Structured Finance & Collateralized Debt Obligations (John Wiley & Sons, September 2008), and Dear Mr. Buffett: What An Investor Learns 1,269 Miles From Wall Street (Wiley, 2009).

During her career, she has been registered and licensed with the SFA, NASD, ASE, CBOE, NYSE, PSE and the NFA and has passed the series 7, 63 and 3 qualifying exams.

Ms. Tavakoli has a B.S. in Chemical Engineering from Illinois Institute of Technology and an MBA in Finance from University of Chicago Graduate School of Business.

Visit: Tavakoli Structured Finance

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