Quote from: CharlieContent on November 12, 2012, 08:10:27 PM

It's bizarre that you are claiming that the fact he attempted to do the impossible somehow absolves him of some responsibility, or that the responsibility is shared.

It's common sense. You can't fault a party for failing to do something impossible.

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It's his fault for trying to do the impossible, after all - he devised the whole ill-fated scheme!

And others equally failed to realize that it was impossible. I agree that he bears fault for that, that's why it's a common mistake.

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The people who gave him money weren't doing so as part of a joint venture with him. That was not the deal. The deal was "Give me money and I will give you a fixed interest, and you can withdraw your principal at any time." and not "Invest with me and we will share risk and profit equally."

I agree that was the deal. The question is what shared beliefs was the deal premised on because those are part of the deal. (Unless the deal specifically addresses them.)

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He broke the deal. It may have been unavoidable, but that doesn't matter. He was running a business. His depositors were his customers. He made an assurance to them and he broke it. The deal was never structured as a joint venture, it was never described as a joint venture, and it shouldn't be regarded now as a joint venture.

The deal was premised on the shared mistaken belief that the business model was fundamentally sound and that the loans were free from significant correlated risk. Read the transcript. An agreement predicated on a shared mistaken belief is actually no agreement at all if it turns out that shared mistaken belief is false.

In this case, there was a shared mistaken belief on which the agreement was based, without which neither party would have entered into the agreement. The question is how to allocate the harm that flows from that shared mistaken belief.