Bob Benmosche wins where so many have failed.
Tag Archives: Wall Street Bail Out
One of the things I’m surprised about is the resiliency of the economy. Things are flattening out, opportunists are making their moves on low prices in many industries. Business is starting up again, mostly because credit is beginning to flow out of the banks.
I really thought it would have been much worse. Given the environment of the crisis, regime change in Washington being the largest and most disruptive, I would have thought by now the pavement would have been fracturing, buildings collapsing, that there would be revolution in the streets.
I said this to Shannon yesterday as we walked cross town on the way to a meeting of one of her non-profit groups that works with disabled vets, and she stopped cold in the middle of Park Avenue.
“You? I can’t believe it….
Back when I was in commerce we’d watch a young executive making a play for relevance and import and say, “Big heros don’t solve small problems.” It’s a version of the old “make a mountain out of a mole hill” idea, but much more dangerous if you let it get out of hand.
On April 3 Eamon Javers at Politico reported on Obama’s meeting with the nation’s finance executives (Inside Obama’s bank CEOs meeting) One could call it a staff meeting since everyone in the room now works for Obama.
The description of the meeting went…
“Dimon (JPMC CEO Jamie Dimon) also insisted that he’d like to give the government’s TARP money back as soon as practical, and asked the president to “streamline” that process. But Obama didn’t like that idea — arguing that the system still needs government capital. The president offered an analogy: “This is like a patient who’s on antibiotics,” he said. “Maybe the patient starts feeling better after a couple of days, but you don’t stop taking the medicine until you’ve finished the bottle.” Returning the money too early, the president argued could send a bad signal. Several CEOs disagreed, arguing instead that returning TARP money was their patriotic duty, that they didn’t need it anymore, and that publicity surrounding the return would send a positive signal of confidence to the markets.”
But you see all this isn’t about confidence in the economy, is it? The government has its hooks in the banks now and it is not going to let go.
The first good news to emerge since the start of the Financial Crisis came out yesterday as the remarkably dumb regulations requiring Mark-to-Market accounting were repealed. Maybe the government can do some good, after all.
Mark-to-Market (MtM) accounting, along with the Sarbanes-Oxley Act (SOX) were the two prime regulatory failures leading to the current crisis. Coupled with public mandated policy to extend mortgages into sub-prime markets through the facilitation of Fanni Mae and Freddie Mac, Mark-to-Market caused, and then accelerated, the financial crisis and lead to the failure of major banking institutions around the globe.
“But I thought it was the greedy bankers that did this?”
Yes, that is what you are being told. Targeting a small group for blame is easier than telling you the truth, that those bankers were working in a system created by gasp Washington.
It is nearly impossible for the current administration to say this becuse they have a vested interest in villifying a secret enemy of those that ‘did’ rather ‘that’ which did, because the ‘that’ is them. Now however, having exausted all other options their only recourse has been to do what works and change some really bad regulations. It took the French and Germans to beat it out of poor Mr. Obama though.
SOX and MtM came out of …
They are Looting My Tax Dollars!
Neil Cavuto, who can be like a rabid dog off of its meds, dressed down Congressman Alan Grayson (D-FL) Tuesday over the “Pay for Performance Act,” a bill Grayson is pushing on the Hill. You can’t miss the clip, it’s all over the web.
The bill is, of course, not about performance. It’s about power. It allows the Treasury to arbitrarily set the pay of all employees; or all employees at companies receiving federal money, which is pretty much the same thing, or will be soon.
There are no guidelines in the bill defining reasonable pay, just authority and full discretion given to the Administration to bypass the market and set pay by non-appealable fiat.
During the interview, Cavuto created …
Populist outrage, it’s all the rage. Everyone’s doing it. Newsweek’s cover story screamed about it. Barney (“I want a list of names!”) Frank is leading it. Anarchist children in London are sharing their view of a utopian future by breaking windows (“In the future we will let in fresh air!”).
But, what it’s all about is a communal display of “blame the other guy, because I’m not at fault.”
The lack of integrity that is washing out of America, and that has now become a global virus, is a vast disgrace. Perhaps the greatest executor of this hideousness is Paul Krugman who had the temerity to insult every American this week in the Times. The severity of Krugman’s egregiousness comes for the fact that he knows better. Or should….