Schwartzneggerian Risk Managers?

"Subprime losses hitting the painful $100 billion mark have focused Wall Street's best minds on the dangers of excess. The result is new thinking about the role of risk managers. Till now, most have been midlevel functionaries powerless to curb the reckless tendencies that got the Street into this mess. ... In the past, 'banks have seen risk mangement as an industrial process where you have the machine, you crank the data, and then you crank the handle,' says Alan McIntyre, a managing director at consultant Oliver Wyman. 'There's been no judgment'," Businessweek, 25 February 2008.

I disagree with Wyman. The banks seem to have had excellent judgment. They apparently always believed "risk management" was something you do because your Big Four (BF) firm needs to complete its Sarbox questionaire to make the PCAOB functionaries happy that BF has enough "file stuffer" on its client's "risk management process". The banks' reality: don't worry about risk, the Fed will bail you out if you get in enough trouble.