Michael
Oct 28th 2009, 02:03 PM
Heads I win, tails you lose
Why Wall Street needs a new social contract
Here is the last three paragraphs...
Though it will not do much to help taxpayers, the much-discussed idea of Goldman and others donating some of their profits to charity would be a start. This would be in keeping with the fine philanthropic tradition of Goldman in particular, which most recently has been funding an impressive “10,000 Women” initiative to send female entrepreneurs in developing countries to business school. Yet to be viewed as a genuine effort to repay the charity investment banks have received, the gifts would need to be large: in the billions of dollars, not the tens of millions.
Shareholders would be wise to support such donations, if management proposes them. Shareholders can also play a constructive role in changing the mood by doing a better job of requiring management to ensure that bonuses are better designed, ideally mostly in the form of restricted stock that does not vest for several years.
As part of establishing the new “social compact” that Larry Summers, Barack Obama’s chief economic adviser, says is urgently needed, Wall Street firms should also stop lobbying against the proposed Consumer Protection Agency, and instead support efforts to ensure it works. As Mr Summers mildly put it, given the help Wall Street firms have received from the taxpayer, some of their behaviour lately has been “a bit rich”.
Source (http://www.economist.com/businessfinance/displaystory.cfm?story_id=14686298#at)
You'd think the Onion might have written this. :ummm:
Note to The Economist: Wall Street's business model is extremely profitable and due to that fact, it is quite unlikely to change. Getting hundreds of billions in taxpayer subsidies is quite likely to make Wall Street much more profitable than ever before. Bankers will never give up their million dollar paychecks no matter what. Even if they drive their companies bankrupt in the process.
* * *
Let me be the first to say it here - The Economist ain't what it used to be. The deterioration in quality over the last two years or so has been horrific. One might think this particular article was written by some kid fresh out of school.
Why Wall Street needs a new social contract
Here is the last three paragraphs...
Though it will not do much to help taxpayers, the much-discussed idea of Goldman and others donating some of their profits to charity would be a start. This would be in keeping with the fine philanthropic tradition of Goldman in particular, which most recently has been funding an impressive “10,000 Women” initiative to send female entrepreneurs in developing countries to business school. Yet to be viewed as a genuine effort to repay the charity investment banks have received, the gifts would need to be large: in the billions of dollars, not the tens of millions.
Shareholders would be wise to support such donations, if management proposes them. Shareholders can also play a constructive role in changing the mood by doing a better job of requiring management to ensure that bonuses are better designed, ideally mostly in the form of restricted stock that does not vest for several years.
As part of establishing the new “social compact” that Larry Summers, Barack Obama’s chief economic adviser, says is urgently needed, Wall Street firms should also stop lobbying against the proposed Consumer Protection Agency, and instead support efforts to ensure it works. As Mr Summers mildly put it, given the help Wall Street firms have received from the taxpayer, some of their behaviour lately has been “a bit rich”.
Source (http://www.economist.com/businessfinance/displaystory.cfm?story_id=14686298#at)
You'd think the Onion might have written this. :ummm:
Note to The Economist: Wall Street's business model is extremely profitable and due to that fact, it is quite unlikely to change. Getting hundreds of billions in taxpayer subsidies is quite likely to make Wall Street much more profitable than ever before. Bankers will never give up their million dollar paychecks no matter what. Even if they drive their companies bankrupt in the process.
* * *
Let me be the first to say it here - The Economist ain't what it used to be. The deterioration in quality over the last two years or so has been horrific. One might think this particular article was written by some kid fresh out of school.