David Rosenthal: belief

Transcript context

…It is just the craziest thing, where they're just like, yup, we're the counterparty to every single trade here, so we're going to generate a little bit of spread on the exchange. We're probably going to get beneficial pricing being the counterparty, because we have the most information in the market for everything that's being traded on here, because it is our marketplace, and we're going to use that information. It's a pretty savvy data advantage. Now, unfortunately, what they do with that data advantage is they do manipulate markets. That, I believe, leads to some part of the downfall case against them, where they are controlling commodity prices and stuff like that. But that I thought, in 99, that really is a pretty savvy way to use the Internet for evil. A really funny thing—maybe we'll talk about this more in playbook—is at the same time this is (I think) really best reflected in both Skilling and Fastow, they were all so smart and yet also so stupid. The combination of brilliance and stupidity in one person and one group of people, it's really something. It's almost like it was smart, but it was cognitive dissonance, where they just thought the rug was infinitely large that they could just keep sweeping stuff under it and that at some point, it would never become an issue for them. Skilling, you watch some of his testimony, because everyone else pleaded the fifth. Skilling stood trial and tried to defend himself. He really does look like a man who thought he did nothing wrong. It's crazy to me how Skilling (I think) really was delusional. That there was so much innovation here, that he thought it was okay. I don't know. There are examples of where you could draw a different conclusion, but you're right. They were smart, and I don't know that they were also stupid. I think they also just had a lot of cognitive dissonance that it somehow wouldn't all come tumbling down.…

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