Hundreds Should Go to Jail

"The law may not change the heart, but it can restrain the heartless."
-- Martin Luther King

For years now, heartless people have been running many of our world's banks and investment houses, and our laws have been insufficient to restrain them. Boards of directors, CEOs, and their leadership teams created incentive systems that rewarded self-interest, impatience, and bottomless greed.

That's a deadly three-punch combo that can flatten employees, customers, and shareholders alike. And it has. So we should not be surprised to find that even as banks have toppled, even as tens of thousands of workers have lost their jobs, even as shareholders have been wiped out, and even as taxpayers are on the hook for trillions via future higher taxes or hyperinflation, the "leaders" of these organizations have continued to pay themselves obscenely. How obscenely? Despite losing $35 billion in 2008, Wall Street firms paid out $18 billion in cash bonuses!

Specific examples are more enlightening still.

Exhibit A
Washington Mutual CEO Kerry Killinger took home $88 million in the seven years preceding the collapse of the bank, which was later handed over to JPMorgan Chase (NYSE: JPM  ) at a 95% discount to prior highs. Killinger apparently designed a gimme-gimme culture fueled by reckless urgency and deceit. He hasn't returned a dime of his compensation.

Exhibit B
After leading AIG's (NYSE: AIG  ) credit-default swap unit, which lost $11 billion in one year, Joseph Cassano was allowed to keep $34 million in bonuses for the year. He was then hired for $1 million per month to consult the company on its maze of transactions. In total, Cassano was rewarded with more than $280 million for helping to destroy the world's largest insurer.

Exhibit C
During a 15-year period as CEO of Lehman Brothers, Richard Fuld lapped up hundreds of millions in rewards. That includes a $22 million retirement pay package in the year his company went under.

Exhibit D
A year ago, John Thain was given a $15 million signing bonus to take over at Merrill Lynch; in 2008, the company posted losses of $27 billion. Today, Merrill is widely considered a bankrupt subsidiary of Bank of America (NYSE: BAC  ) . Yet this December, Thain lobbied hard to be paid a $10 million bonus. And why not? His predecessor, Stanley O'Neal, received a $160 million retirement package after posting writedowns of $8 billion in a single quarter.

Hard as it may be to believe, there is no law that mandates the return of compensation when an executive's actions destroy a corporation. There's also no law that says you can't be heartless. Being soulless isn't criminal. And having no shame isn't actionable. To take legal action, federal authorities have to prove that these and other bankers had an intent to deceive. For example, if they can prove that Thain misled Bank of America before the acquisition, or that Thain and BofA misled regulators about the condition of the bank to secure bailout money, those points would be cause for prosecution.

But in the many cases in which regulators won't be able to prove anything, we won't see orange jumpsuits on the hundreds of bankers for whom they would fit.

Hundreds? Yes, certainly. At least that many. Remember that the banking sector has wiped out its investors, is decimating companies that rely on credit, and is primarily responsible for our rising unemployment.

So what are we left with, in terms of people who may go to jail? Well, there's Bernard Madoff -- whose deceit has spanned decades -- as well as what is certainly a team of shills. Early analysis of the accounting suggests that Madoff actually executed few, if any, trades. And in a true show of heartless cruelty, when Madoff was arrested, he had $170 million set aside not for the clients he had destroyed, but for friends, family members, and select employees. His lawyer is now being paid $1,000 per hour with client capital.

The search for confidence
What the markets need now, we hear every day, is confidence. Master investor David Swensen, head of Yale's endowment, said as much on The Charlie Rose Show last week. And of course, he's right.

As we saw with the falls of Bear Stearns, Lehman Brothers, Washington Mutual, and Wachovia, lack of confidence leads to bank runs, bailouts, and bankruptcy. And when our banking system is crippled, there isn't enough confidence left for investors to fairly value even the most honorable organizations -- names such as Costco (Nasdaq: COST  ) , Procter & Gamble (NYSE: PG  ) , Berkshire Hathaway (NYSE: BRK-B  ) , and Johnson & Johnson (NYSE: JNJ  ) .

But until there are new regulations in finance, there will be no rebound in investor or consumer confidence. Until the rules for the TARP plan restrict banks from paying bonuses during the deepest recession in decades, taxpayers will not stop getting angry. Until we see clear evidence that those who destroy companies will not benefit from their actions, we will continue to suffer the consequences of moral hazard. In short, until the market system looks meritocratic and constrained by ethics, why should we expect the mainstream investor and consumer to demonstrate confidence?

Tom Gardner is the co-founder and CEO of The Motley Fool. He owns shares of Johnson & Johnson. Bank of America is a former Motley Fool Income Investor recommendation, and Johnson & Johnson is an active pick. Costco Wholesale and Berkshire Hathaway are Motley Fool Inside Value and Motley Fool Stock Advisor selections. The Fool owns shares of Berkshire Hathaway and Procter & Gamble. The Motley Fool is investors writing for investors.


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  • Report this Comment On January 29, 2009, at 2:15 PM, FleaBagger wrote:

    Dear Tom,

    Thanks again for the t-shirt. It's handsome and comfortable.

    I want to take issue, however, with your characterization of banking and investing as lacking adequate government involvement. Simply put, investors have relied on the government to take care of them and protect them from bad investments, so they blindly go where they are led by mutual fund salesmen, rather than put forth the effort to educate themselves. You used to advocate personal education. But now you want a public policy change because people are suffering for their own mistakes (people who blindly invested in WM, AIG, Bernie Madoff, etc.).

    The government's involvement in the current crisis started when it bullied banks away from "redlining" (remember that term?) and fueled the housing bubble and the credit crisis. Now it is raising deficits and probably taxes. I have yet to see any significant harm to anyone that wasn't caused by the government or by those harmed. More government involvement will mean further disaster, as it did in the 1930's and the 1970's.

  • Report this Comment On January 29, 2009, at 2:23 PM, johninmn wrote:

    Yes they should!!

    And what schools did these fine pillars of society go to?

    Perhaps some of the money should go to mandatory Ethics Classes in the MBA and Finance programs they took.

    The Board members who all go to the same clubs and pat each other on the back should be thrown out too. How can they hire these crooks back as "the best we have" to work on fixing the companies?

    I don't understand the logic?

    Pretty amazing Dollars we all pay for their "self-interest, impatience, and bottomless greed." I'd love to see some jail time and a recall of some of these dollars. Perhaps that would restore some confidence for investors.

    How do these guys sleep at night?

    Great article!

  • Report this Comment On January 29, 2009, at 2:28 PM, sheguno wrote:

    I'd rather chose to believe that you don't know what redlining is than believe you are actually advocating it.

    Secondly, a lot of this financial mess had nothing to do with a government law that has been in the books for over two decades to make sure folks don't get discriminated against. The law didn't apply to the Countrywides and builders giving loans. They hardly existed then and weren't factored in. It applied mostly to commercial banks.

    Many of those banks are fine. It's the big boys/gals who are in trouble for greed.

    I can't understand people who believe the market can do no wrong and it is always the government at fault, even in a clear case of a market overcome by severe greed with no rules to mitigate it.

  • Report this Comment On January 29, 2009, at 3:13 PM, TMFDiogenes wrote:

    Hey Flea,

    I don't think it's a question of whether we need "more" or "less" government involvement, but rather whether there are laws on the books limiting what most people would rightly consider to be fraudulent behavior (whether or not it meets the legal definition of fraud.) Ignorance and enormous incentives and are in place that encourage executives to raise short term performance regardless of the systemic risks it entails. True, shareholders should educate themselves better to avoid being tricked by that, but since we as a nation are on the hook for the systemic risks if don't want capitalism to literally implode (as it did in the 1930s) it's simply not fair to taxpayers that we depend on shareholders to keep their managers in line. So we, as a nation, have basically 6 choices:

    1) We depend on the intelligence, ethics, and altruism of investment bankers to do the right thing and put the interests of long term shareholders and America above their own.

    2) We depend on the intelligence and long term interest of mutual funds with holding periods of less than 1/2 a year to keep their managers in line.

    3) We depend on shareholders to a) read 10-k's, b) demand comprehensive risk disclosure, and c) make wise investments in stocks and funds that don't expose themselves to rotten apple companies.

    4) We enact sensible reforms (like the ones we had from the 40s through the 90s) that prevent firms from doing dumb things that put the us all at risk, perhaps at the expense of the banking industry's profit margins and bonuses.

    5) We do nothing until there's a crisis and bail everyone out.

    6) We do nothing at all and let the banks fail and capitalism implode.

    .

    Right now, we're witnessing what a pleasure #5 is. And while I agree with you that #3 is an ideal we need to strenuously continue working towards, I don't think we can tell taxpayers and the rest of the nation that they have to rely on investors to make rational, long term decisions -- at least not considering humanity's track record of playing with ridiculous speculative bubbles dating back at least as far as the tulip bubble in the 1600s. It's simply not fair to ask taxpayers to trust investors to behave rationally until we earn that trust.

    - Ilan

  • Report this Comment On January 29, 2009, at 3:32 PM, ianoc wrote:

    Excellent article and bang-on point. My suggestion is for you to keep beating on this drum, and do so with all the strength you can muster, because your message must be heard not just across the country, but around the world. I suggest that a mere 3,000 morally bankrupt people on Wall Street and in the nations first-tier banks and other financial institutions, brought down the world’s financial markets. This cadre of thieves sat on each others boards, and they learned their corrupt ways at the nation’s premier B-Schools while in training to become masters of the universe: places like Harvard, Wharton, Stanford and Chicago. Their actions over the past 10 years were indeed wanton, deliberate and illegal, which means they should be prosecuted for fraud and thrown in prison, not jail. There is a difference. Just ask Dennis K., who’s currently doing 8 to 25 as a guest of the State on New York.

  • Report this Comment On January 29, 2009, at 4:06 PM, captmaniac wrote:

    , but they won't. With what would you charge them? Greed? Morally, they're guilty, but legally - there's the rub. Many of those in executive management have been receiving obscene compensation packages, including golden parachutes. And who determines those packages? Compensation committees formed from board members. Many of those board members are in executive management on other companies. In some instances, it's just a "good ol' boys club" scratching each others back at the expense of the stockholders. Until the stockholders become incensed and say "no more" at the stockholder's meetings, the Government will have little effect.

  • Report this Comment On January 29, 2009, at 4:39 PM, wgk2001 wrote:

    I agree that executive compensation in today's large corporations seems to be obscene. There appears to be no accountability other than losing the job (usually accompanied by a generous payoff). Meanwhile the disparity between executive and employee compensation and keeps getting bigger. Perhaps the solution is to legislate that executive cash compensation cannot exceed 20x (or whatever reasonable multiple) the lowest employee is paid, and all additional compensation (bonuses, options, etc.) be held in escrow and only paid in future years (3-5) if the company is profitable, otherwise be forfeited to help cover the losses. If you extend "employee" to include those of outsourced services you might really make corporate leaders do a little sole searching :)

  • Report this Comment On January 29, 2009, at 4:45 PM, Big50Shooter wrote:

    Bravo Tom!!! Bravo...

    While I tend to have a more laissez-faire attitude when it comes to government involvement in ANY industry, I would like to see the government become involved in the prosecution of the same farging-bastages that you describe above Tom...

    I also agree that we investors need to have a MUCH louder voice during the shareholders meetings regarding the rediculous levels of compensation that these BOD members are enjoying, regardless of how they perform...

    Personally, I also have a very affective way of dealing with these buffoons who bilked their shareholders, and now the American Taxpayers, out of billions. I am not going to say exactly what my favorite personal "fix" is here, but my Fool-handle can reveal it for me:

    Big50Shooter (the 50 stands for .50 caliber)

    ;-)

  • Report this Comment On January 29, 2009, at 5:04 PM, upupaepops wrote:

    Congratulations to Tom Gardner and to TMFDiogenes for their cogent remarks.

    The public certainly needs oversight over corporate and financial institutions. Unfortunately, however, only the very worst cases of greed and fraudulent activity will be addressed. The private property system will not allow anyone to take away their prerogatives without a big fight.

    So, reform is good, and certainly sorely needed, but I think we need to go beyond what most are suggesting, and make serious and permanent inroads on corporate and financial power.

  • Report this Comment On January 29, 2009, at 5:09 PM, AnnaDcc wrote:

    I agree. -And it needs to be real prison - not house arrest in a mansion. A good portion of the Bush administration needs to be investigated on criminal charges as well, since they, by negligence, are almost as responsible for this mess as are the bankers that abused the system.

  • Report this Comment On January 29, 2009, at 5:26 PM, nunnatheabove wrote:

    Accountability

    Government: None. Both parties have a part in this and nothing will get done. It's my understanding that former employees of FNMA are now working for the new administration. There are monies going out the door and where is it going, what are they doing with it? Accountability?

    Now the government wants part of my IRA's to keep for me. They have done such a good job with the following I think they should. Those are the same people who have kept my Social Security and those who have got a great energy plan in line - this energy problem has been going on since 1972. (Remember waiting in line for gasoline.) Both parties are party to this mess. These are the same people that just voted themselves a pay raise in the middle of this situation - Accountability?

    Me, my children and my grandchildren will be paying for this the rest of our lives.

    Laws are made because people can't govern themselves. This list includes corporate and government people.

    Thank you! Thank you! Thank you! I just can't thank them all enough.

  • Report this Comment On January 29, 2009, at 5:50 PM, globalchem wrote:

    There is a special place in hell for those who take big bonus checks then screw up the company-- They are worse than Madoff-- He is a crook and we all see that but these worms want the money and respectability.They destroy the lives of those who worked hard for the money they steal.

    How much money do you need???

    They should be shunned by every one

  • Report this Comment On January 29, 2009, at 6:09 PM, FoolKMP wrote:

    The thing I really don't understand is that when they justify the bonus and excessive compensation they say they have to pay it to keep the top talent around. Is that the same top talent that let your company go down the crapper and lost all that money?

    We have been betrayed as shareholders, employees, and hard-working citizens who pay our taxes and our mortgages on time by the greed of others. If we can't put them in jail legally, let's put a bounty on them...you rob us, we shoot you.

  • Report this Comment On January 29, 2009, at 6:35 PM, jbromet wrote:

    To the readership of Motley Fools,

    I agree that virtually hundreds of CEO's, FCO's, and the boards of directors who turned a blind eye and/or were complicit to the greed taking place within their institutions should go to jail. However, I don;t want to leave out the Congressmen and Senators who either promoted ro encouraged foolish policies that led to the financial downfall. It was men such as Barbny Frank who threatened to sue Freddy Mac & Fanny May if they didn't offer loans to people who had no means and no stake in the house they wanted to buy. These same "servants of the people" were more than happy to be bribed to look the other way when things went south. Ultimately, it was the people's grievous error in continuing to vote into office a gang of criminals we call legislators. The people get the government they deserve.

  • Report this Comment On January 29, 2009, at 6:44 PM, jbromet wrote:

    An additional statement:

    If bankrupting the entire world isn't a crime and condemning the poor to an even harsher existence then they would otherwise have isn't a crime, we have lost all perspective. The people whose job it was to safeguard our children's future should be jailed and their assets and the assets of their families should be seized. The lesson here is that if you jump a turnstile, you go to jail. If you steal billions, you walk.

  • Report this Comment On January 29, 2009, at 6:51 PM, spyderfngrs wrote:

    Ah, the "invisible hand" is at work again making the corrections necessitated by those seven deadly sins, including slothful ignorance.

  • Report this Comment On January 29, 2009, at 7:12 PM, TrueFlaco wrote:

    Hurrah to jbromet on focusing the blame where it belongs - our government leaders. He mentioned Barney Frank but don't forget Chris Dodd and others that thwarted any attempts at reform. Fleabagger has it right on and in response to sheguno, guys like Fleabagger and myself blame the government not because the private sector didn't do anything wrong, but because it would have self-corrected in a regular functioning market. In this case, because the government was pushing for Fannie & Freddie to increase the loan portfolios to the poorer folks that really couldn't afford it, there was an implicit gov guarantee on these securities that ultimately led many private entities to extend themselves beyond what would have been wise under normal circumstances. And, because of this implicit gov guarantee, the tab finally came due and we all pay because, as jbromet noted, we continued (not me but the country at large) to vote in these folks. The sad thing is that the media is so invested in a left-wing/big-government idealogy that you won't and don't see them asking the right questions and pointing the finger of blame where it should go. Instead, they all cheer on more government intervention, which led to this problem in the first place.

    As for calling on these former and current CEO's to go to jail, I understand the complaints but remember that the best way to reform these companies is through shareholder activism not government intrusion. If we become the country where the government controls what company leadership makes, believe me that these leaders will find somewhere else to live where these same constraints aren't in place. Now, if you are able, through shareholder activism, to get a particular company you are invested in to put some strict limits on their top officers, be ready for the consequences: a dearth of top leadership talent in your company.

  • Report this Comment On January 29, 2009, at 8:04 PM, nuf2bdangrus wrote:

    The incestuous relationship between government, Wall Street, and the SEC and other regulators is a revolving door that has built a model that creates incentives to bankrupt our country, as the taxpayer is ultimately on the hook. Sadly, this was not capitalism, it was crony capitalism. But capitalism will be the scapegoat, and socialism will be the replacement. This does not bode well. The government needs to become a good and honest referee, a role it was designed for and is failing miserably. Sadly, I see no hope. In an immoral and amoral culture, both government and top leadership live in a selfish world in which there is no self restraint. Lack of self restraint is the direct result of the decline in religious and civic values that made this country. I do not see good things ahead.

  • Report this Comment On January 29, 2009, at 8:44 PM, pmbarrett wrote:

    Jail time? Sure, just as soon as the bastards that bought a house with nothing down, saw it rise in value, refinanced at the higher valuation, took the cash and walked away from it, go to jail!!! Along with the loan officer and agent that facilitated this sham It wasn't just greedy corporate types that caused this problem, there were plenty of our finest citizens that made an easy buck on the back of the taxpayers. More damning, is the fact that our great and wonderful government, decided that these "citizens" should not be forced to give up their ill- gotten gain, by letting short sell, or put the property into foreclosure, without a penalty. Again, the taxpayers are picking up that tab.

    Greed had it's place in our society. When we were a country that actually manufactured products and sold them to the world, it was our greedy Robber Barons that provided this country with the wealth necessary to grow our nation. Look at the universities, towns, libraries and other tangibles that these people built. Now look at today's greedy corporate executives, most of them are in the business of paper shuffling and money handling. Or, better put, businesses that do not make a product or add value (ie; insurance, banking, hedge funds or brokerages). They simply steal wealth from their stockholders or customers! When America gets back to manufacturing products, then, and only then, will our wealth return.

  • Report this Comment On January 29, 2009, at 9:06 PM, teejk wrote:

    exec comp...I don't know where/when it started to get out of control but the rationale is that comp has to be measured against a "peer group". I've always suspected that the first "peer group" that started all this was somebody's fictional group of companies that paid fictional comp. The spiral started from there even though the fictional "peer group" disappeared from the scene a long time ago...no longer needed since comparables are now based on real companies that got suckered into the initial "peer group"

  • Report this Comment On January 29, 2009, at 9:07 PM, syvranchr wrote:

    You tell it as it is Tom. However, the tentacles of greed I believe, reach much further than what you expressed in your article.

    Our government offices of regulation such as the SEC and others CHOOSE to look the other way. Heck, I WATCHED what was obvious insider buying in the last minutes of the market closing when the price of stock rose about 8% in a time period that was so late in the day it was IMPOSSIBLE for me to get into the floor electronically for buying when I started to see it rise. But the good ole guys got the profit taking at the end of the day and could get by with it because no one is really watching.

    I wish there were a way as stockholders, who are actually OWNERS of the corporations could file a class action lawsuit for at least a Grand Jury. AND HAVE THAT HEARING TELEVISED NATIONALLY presenting the evidence with all the personal names and companies. Or why doesn't congress hold hearings?

    Now that was a stupid question wasn't it? Afterall Congress is in the same smoking room as the Executives of Greed and in reality the Exec's Lobbyist are the real managers who pull the strings of the puppets who set in the ivory towers. Also known as the US Senate and House.

  • Report this Comment On January 29, 2009, at 9:35 PM, rottenjohnny wrote:

    some people might say that this country started down the road to being a morally, ethically, and spiritualy bankrupt nation beginning in the year 1960. that was the year that i was taught on govt run public television that life began or was created when a lightning bolt hit the ocean and inorganic elements sprung into life as amino acids. the human race thereupon preceded to create themselves through the process knowns as chuckie darwin's law of evolution.

  • Report this Comment On January 29, 2009, at 10:45 PM, FoolKMP wrote:

    We have to start figuring out ways to STOP the madness, the greed, etc. 1) Term Limits for EVERY ELECTED OFFICIAL. 2) Executive TOTAL compensation must be limited and tied to the lowest paid worker's salary, as I believe they do in Japan. 3) Creation of another viable strong, political party...a MUST! 4) Strict LIMITS on the total amount of dollars accumulated by political fundraising from ALL sources. 5) The LINE ITEM VETO. 6) If your company would like to sell it's products in the United states, then at least 50% of your workforce must be based in the USA, and 50% of your products must be built in the USA, otherwise we ban your company from selling products or services into the US marketplace. 7) NO EXCEPTIONS!

  • Report this Comment On January 29, 2009, at 10:45 PM, Schmedlap wrote:

    I agree with everything in the article. What troubles me is that it only focused on the hundreds who are culpable, rather than the tens of thousands, and perhaps millions.

    The "leadership" of these banks provided incentives, motivation, and direction. But somebody had to implement those unethical and immoral guidelines. And there was no shortage of people willing to do so, whether they be middle management at the banks, mortgage loan officers at banks from which mortgages were purchased from, giving out loans without due diligence or in some cases outright fraud, people taking out loans who had no business doing so, rating agencies who were either outlandishly incompetent or flat out lying, and any number of others who contributed to this mess. A few hundred people did not take down this economy. Tens of thousands did - and perhaps more. There are more than a few hundred people who will walk away from this mess with blood on their hands and no punishment to show for it. Let's not forget that, simply because the few hundred mentioned in the article will be getting away with more egregious sin than the others.

  • Report this Comment On January 29, 2009, at 11:04 PM, allyndreth wrote:

    What seems to be left unmentioned is that a Bonus was originally meant to be additional compensation from PROFITS if a company had an unusually good year (ie: a reward for exceptional success) - not an annual dipping into the company for extra cash.

    Bonuses used to be rare and even pay raises for management used to be calculated on a firm's ability to pay them. So, if there were losses, how could one get a pay raise let alone a BONUS!

  • Report this Comment On January 29, 2009, at 11:19 PM, HarryFlip wrote:

    This is an article that is long overdue. You are visible and respected - most of us are not able to influence the 'powers that be' because we are invisible.

    The whole mess going on in the economy right now is incredibly criminal in nature to a large degree. Enron was bad - Madoff was bad - this is much, much worse on so many levels.

    I simply encourage you and whoever else would join you to turn up the volume. People MUST go to jail over this.

  • Report this Comment On January 29, 2009, at 11:43 PM, SwampBull wrote:

    The mantra of the people today should remind us of the burdens we have faced in the past -

    NO TAXATION WITHOUT REPRESENTATION!

    We are all shackled to the 'rescue' packages to the tune of $5000 plus interest each - $1.5 trillion across the 300 million American citizens. Where do we stand to benefit? Do we have a stake in the banks as a result of $800 billion in the TARP program? No! Will the government ever profit from collecting all of the mortgage-backed securities into a 'bad bank? No! As many have already attested, we have been conned by both the banking system and the legislative branch.

    What should we do in protest of this blatant irresponsibility? First - VOTE. Get these swine out of Capitol Hill, and tell them to keep their brilliant ideas to themselves. Let's elect leaders who care more about the long-term preservation of our Constitution and the future of our society rather than the promotion of their starkly partisan interests. Nancy Pelosi in particular should be removed from office for her polarizing and self-serving behavior.

    Second - shun the banks. Their stocks are worthless, because they have made it clear that not only their owners - that is, the shareholders - but also their customers mean nothing to them. They have scalped countless retirement plans through their irresponsibility, and now they beg our representatives in Washington for help? Let them reap what they have sown. We can nationalize the banking system temporarily until we can find members of the private industry worth their salt to lead these institutions.

    Finally, let's stop ranting on blogs and griping at the water cooler and ACT. We need Washington to understand our frustration. We must not allow these crimes to go on unabated. The future of our country and our personal wealth depends on it. Contact the people whom we have elected to run this country to let your voice be heard.

    House Speaker Nancy Pelosi

    Email: sf.nancy@mail.house.gov

    Phone: 202-225-4965

    Senate Majority Leader Harry Reid

    Email: senator_reid@reid.senate.gov

    Phone: 202-224-3542

    President Barack Obama

    Email: comments@whitehouse.gov

    Phone: 202-456-1111

    Homeland Security Secretary Janet Napolitano

    Mail: Department of Homeland Security

    Washington, DC 20528

    Phone: 202-282-8495

  • Report this Comment On January 30, 2009, at 1:50 AM, kurtisj wrote:

    Angry? You're damn right we're angry.

  • Report this Comment On January 30, 2009, at 2:40 AM, PokerElBow wrote:

    The simply solution becomes neccesary at a point when you cannot stand someone in front of juris prudance to be judged. You must seize their assets and distribute them amongst the people. Allow them to keep exactly One million dollars. A reasonable amount for one to earn in forty years of a working lifetime. If they are of such talent, they will buid an empire. Straw into bricks with tools that work. These "Thousands" of corporate execs that have been permited to rob public companies simply because they were frat brothers of our elected politicians. Where's my rebate charlitian? Must we come and get it ourselves? Just start a level playing field and give all American citizens a real start in life in the land OUR forefathers fought to create and build. These CEO's were permited to believe that they were Sadams and kept not only the profits but the whole months reciepts.Take it back and let them prove that they earned it after. They should have been paid in stock alone to begin with!! Bonus' should have been voted on by the minority shareholders and awarded also instock only. Make them pick up the tuition tab for Americas college students, at the very least. They should not continue to live in the manner in whih they have grown too accustomed. Seize their accounts ASAP.

  • Report this Comment On January 30, 2009, at 3:46 AM, JDEvolutionist wrote:

    The reality is that we all share some of the blame, that’s – individuals, corporations and governments. The bottom-line is that a relative few, bankers, financiers, politicians and celebrities, were the major beneficiaries.

    Yes, quite a few ordinary individuals made a killing too but only on the back of those that really, and totally unjustifiably in most cases, became excessively rich through absurd bonuses, unjustifiable options and salaries totally out of line with the value of the work performed.

    The fact is that a system evolved which gave people in the position of power far too much opportunity to benefit themselves without proper constraint, either through regulation or personal ethics. The result was a system that became basically highly corrupt: corrupt because it was stealing money from those who were funding it. It was accepted because it gave the misleading appearance of producing a very sound financial structure; in spite of the fact that most thinking people knew that it was not logical. The problem was that the appearance did not reflect reality and only existed because of an inherent inertia in the system that allowed the creation of ‘wealth’ that in fact had no foundation in true wealth creation i.e. did not ever exist. Business was being funded by imaginary money.

    It is part of the ‘celebrity’ culture where a few people benefit from involvement of the masses, in a process whereby the masses pay what appear to be relative small sums for a range of superficial benefits but which results in vast total receipts and ludicrous incomes for a very select group of individuals, who’s functionality is, in fact, worth no more than that of the average working man. The process is not new.

    The ivory tower created has now collapse and once again as it ‘stands’ at the moment, the ones that are being asked to pay for putting things right are the general public, principally the ones at whose expense the whole fiasco was created. This is not fair. While I do not advocate, with some exceptions, jail for all CEOs and directors, there is a very real case for the democratic, and we are continually told that the west is democratic, governments of the world, as elected by the people, to introduce legislation that claws back much of the wealth that has been stolen from the bulk of the people in those democratic nations.

  • Report this Comment On January 30, 2009, at 8:11 AM, dmeredit wrote:

    Tom,

    Shame on you. What I truly take exception with in your article is that you have jumped on the shallow media bandwagon that touts $18billion as an obscene amount, as if that has been paid to only a handful of top executives. The reality is that the bonuses have been paid throughout an industry that employs hundreds of thousands of hard working professionals, 99.99% of them honest individuals who put in long hours to perform a professional job and whose firms (a) did not receive bailout $'s, and (b) did not suffer as poorly as those who you mention in the article. Your focus on the 0.00001% who have taken advantage reflects poorly on your ethical position.

    Take my own company's situation. I lead a technology team on the "corrupt wall st". Everyone here regularly works 50-70 hours weeks - there is not a person in my team who did not work a continuous 48 hour shift in 2008. They are not paid fortunes - and many of us have taken a cut in our base compensation to help the company survive through lean times. Do I think my team deserves a bonus for the exceptional work they did in 2008 - most certainly yes. Will it be an obscene amount - no. But even the small amount we pay will contribute to that $18B obscene amount you quote.

    How many of the Motley Fool staff received a bonus in 2008? Did you? Did you deserve it? If you paid $1 in bonuses, you contributed to the number quoted. Please - let's stop the hypocrisy and labeling everyone in Wall St as corrupt individuals that should go to jail.

    I've always respected you as an enlightened soul with an aim to educate. This article sorely disappoints me.

  • Report this Comment On January 30, 2009, at 8:20 AM, pmbarrett wrote:

    Damn, after reading all these comments, I'm amazed at all the Socialists and redistributionists that frequent this board. Doesn't bode well for the future.

  • Report this Comment On January 30, 2009, at 8:33 AM, MPov wrote:

    Tom, I want to echo dmeredits thoughts. If you were in politics I would accuse you of shameless politicking. While $18 billion is a lot of money, the fact is that only a small handful of the people who receive Wall Street bonuses are fat cat senior executives making millions of dollars. Most of that bonus money goes to the tens or even hundreds of thousands of workers and middle managers at the Wall Street firms, and it is often a large portion of their compensation. These are mostly middle class and upper middle class folks who rely on that money to feed their families, pay their mortgages and car loans, and maybe save some money for their retirement and their kids' college educations.

    I am one of these people. I work for a firm that received TARP funds. I work hard and I do my job well. I did nothing to create the current economic problems. To suggest that I should go to jail because I got paid a bonus is insulting, and just plain wrong.

  • Report this Comment On January 30, 2009, at 9:25 AM, TMFTomGardner wrote:

    MPov,

    If your firm received TARP funds, that means it was at risk for not having the capital required to meet its obligations as a business. This horrible news for any organization. And what does it lead to? Belt tightening. Layoffs. Pay cuts. And certainly the elimination of bonuses. When your firm risks insolvency, you do not pay bonuses. That's standard on Main Street. When, in order to remain solvent, you receive taxpayer bailout money, you certainly do not pay bonuses. What your note actually confirms is that the bonus money was *not* about retaining talent. Like people across the country, you need your job. And the difficult times would/will force you to curb your spending AND to not be thinking about seeking other employment. In this environment, I see no reason that a dollar of taxpayer money should've been paid out as a bonus. I don't see it at other organizations facing insolvency, the vast majority of which will receive no bailout capital from the taxpayer. Why should it be any different on Wall Street?

  • Report this Comment On January 30, 2009, at 9:32 AM, captmaniac wrote:

    One comment inferred that if you were angry about excessive compensation and bonuses, you must be a socialist. That's bogus. Tom is not talking about the "average Joe (or Jill)" who gets a reasonable bonus each year. Another comment said we should have legislation that would limit the disparity (like 20X) between executive management and the average worker. In a democratic and capitalistic society, that would not work. However, the IRS could say that compensation about a certain limit could not be tax deductible as a salary expense (or any other business-related expense). The Government should not continue to subsidize such excesses. They limit how much I can deduct for medical expenses (for example).

  • Report this Comment On January 30, 2009, at 10:06 AM, TMFTomGardner wrote:

    pmbarrett, my question to you about socialism. In a truly free-market system (which it sounds like you may be espousing), should we not prosecute Bernie Madoff? Life is just one big buyer-beward experience. So there should be no punishment for knowingly distributing peanut butter tainted with salmonella? We should remove all stop signs and speed limits, and shave back all speed bumps in school zones -- because, hey, it's up to pedestrians and other drivers to fend for themselves? And when it comes to money management, if you don't allocate a certain number of hours each week and don't hire your own detective agency to ensure that your money manager isn't a thief, too bad for you. It's a big free market out there. And if CEOs want to pay themselves $150 million as a "retirement" option, just as their corporation is collapsing...it's just too bad for the shareholders and employees that weren't paying enough attention. I believe there is a lot of space on the continuum between a totally free, rule-less market and outright socialism. The world of finance needs speed limits, stop signs, speed bumps, effective law enforcement, and the threat of prosecution.

  • Report this Comment On January 30, 2009, at 10:35 AM, MPov wrote:

    Tom, I want to respond to your message to me.

    First, let's get some facts straight. Most of that $18 billion in bonuses was based on 2007 performance, and paid in the first quarter of 2008 - before Bear Stearns, long before Lehman, and long before bailouts and TARP were even a glimmer in Congress's eye.

    Second, there is plenty of belt tightening taking place on the Street. Good people are being laid off, salaries are being frozen and bonuses will be cut (if paid at all). (By the way, these layoffs, freezes and cuts will ripple through the New York economy, increasing everyone's tax burden).

    I recognize the need for belt tightening and cuts. What is hurtful is your implication that I should be locked up because I got a bonus last year. I still feel insulted :(

  • Report this Comment On January 30, 2009, at 10:54 AM, Buffal0Bill wrote:

    Men's hearts are corrupt. The more we try to banish God from our society the more our corporations and institutions will fail because more and more of the men who lead them will have no regard for God and His principles. When greed is your operating principle, you will ultimately fail no matter how successful you are in the short term. No amount of laws and regulation will prevent men from trying to find an "angle" or a "shortcut" rather than providing fair value for money invested or for money used to purchase a product. Our culture is now reaping what we have sown for the last half century. We just installed a tax cheat as our Treasury Secretary because he's supposedly the only guy in the country smart enough to fix our economic problems. Who are we kidding?

  • Report this Comment On January 30, 2009, at 11:56 AM, FleaBagger wrote:

    "Damn, after reading all these comments, I'm amazed at all the Socialists and redistributionists that frequent this board. Doesn't bode well for the future."

    You said it, pmbarrett. And then Tom takes one crook and uses him as a cover for all the socialist rhetoric in the comments, and yes, even in the original article. "We need more regulatory oversight!" Why? Madoff is going to jail. What he did was already illegal. To use him as the example of why we need more regulation doesn't pass the smell test.

    As for the rest of the greedy sons of guns on Wall Street, why not let Bear Stearns, Lehman, etc. shareholders take this as lesson learned? Because there's a credit crunch? I thought Fool.com was against our debt-swilling, overconsumptive economy. The people who were responsible actually benefit from a credit crunch, because of the price decreases when people with no money finally stop buying things they can't afford. Because government money is involved now? Surely we free market advocates won't be blamed for that, now will we? We were among the 80% of the country against bailing out Wall Street in the first place.

    So, yes, I'm okay with Bank of America paying John Thain a zillion dollars. Or AIG spending AIG's money sending their execs to Aruba or wherever the heck they went. That's their business, and if it's not, because they got a bailout, whose fault is that?

  • Report this Comment On January 30, 2009, at 12:13 PM, bobbobwhite41 wrote:

    The director of Yale endowment has it all wrong. Perhaps that's why he heads up the biggest group of elistist investment fakers next to Harvard.

    "Confidence", the thing he said is needed most in the USA markets, is NOT the thing that must occur first in the recovery process, as confidence is ALWAYS the result of something else coming previous that serves to inspire it's manifestation. He could not be more wrong in this, as usual.

    Getting the cart before the horse is always something these elitist guys do best, as they fully intend to be as oblique, obscure and arcane as possible to the great unwashed far beneath them. That's what separates them from the real people of this country, and they even prefer to be seen that way! Incredible.

  • Report this Comment On January 30, 2009, at 12:23 PM, iewagner30 wrote:

    Don't disagree with your list of crooks, but you need to had the politicians like Christopher Dodd, Barney Frank and our own President Obama to the list for sorry oversight and policy making, especially as it relates to Fannie Mae and Freddie Mac. That's where this whole disaster started.

  • Report this Comment On January 30, 2009, at 12:26 PM, FleaBagger wrote:

    Here is the url for a very nice Fool.com article about people investing in high-risk, no-reward investments because they give an illusion of certainty.

    http://www.fool.com/investing/value/2009/01/29/the-dumbest-i...

    How is this relevant to the current discussion? Well, I think it goes a long way to explaining why people always want more regulation, even though a look at the world's economies shows almost perfect correlation of economic freedom and per capita wealth creation. (More freedom, more wealth creation.) Also, the freest economies have the most rich people who grew up poor and unconnected. So why more regulation, when anyone can see that it doesn't work anywhere it's tried, and freedom creates prosperity and opportunity for all?

    Well, because we have a powerful, ardent craving for safety, or control of our situation. Our expression of our need for control may very well be expressed as a call for more regulation from government. We think that if we can get 50.1% of voters on our side, we can control our situation with oversight -more detailed instructions for the future.

    We want no uncertainty, even if we have to settle for certain failure. To make ourselves feel better, we trade freedom and prosperity for the secure penury of government control.

  • Report this Comment On January 30, 2009, at 12:48 PM, UrbanJackBag wrote:

    Once banks started holding out their hand for money from the government, they lost the ability to decide for themselves what "reasonable" is. It was too hard for all these banks to just go away because they were too weak. Once they decided to try to be a "hangers-on", they have to play by Daddy's rules.

    Government will infinitely get bigger - "the line for money forms to the left."

  • Report this Comment On January 30, 2009, at 1:00 PM, pmbarrett wrote:

    pmbarrett, my question to you about socialism. In a truly free-market system (which it sounds like you may be espousing), should we not prosecute Bernie Madoff? Life is just one big buyer-beward experience. So there should be no punishment for knowingly distributing peanut butter tainted with salmonella? We should remove all stop signs and speed limits, and shave back all speed bumps in school zones -- because, hey, it's up to pedestrians and other drivers to fend for themselves? And when it comes to money management, if you don't allocate a certain number of hours each week and don't hire your own detective agency to ensure that your money manager isn't a thief, too bad for you. It's a big free market out there. And if CEOs want to pay themselves $150 million as a "retirement" option, just as their corporation is collapsing...it's just too bad for the shareholders and employees that weren't paying enough attention. I believe there is a lot of space on the continuum between a totally free, rule-less market and outright socialism. The world of finance needs speed limits, stop signs, speed bumps, effective law enforcement, and the threat of prosecution.

    Tom, it's obvious that you did not read my first comment, only the one you did not like! Certainly Madoff should be prosecuted, but what he did was a criminal act. Anyone that commits a criminal act should be proscuted to the fullest extent of the LAW. What you alluded to in your article may have been stupid, but it was not criminal. As far as stop signs and traffic laws, speed bumps etc.,what has that got to do with the original discussion? Tom, you should know better than most, that investing has always had risks, and if you don't due your due diligence before investing your money, than you run the risk of losing that money. Yes, the buyer should be aware. We don't live in a nanny state, and I for one don't ever want to live in a nanny state.

    Tom, so according to you, if a business is on par to lose $3B and slash 3000 jobs due to prior mismanagement, but brings in a turn around specialist that is able to only lose $1B and preserve 2000 jobs, that person should not be rewarded with a generous salary and bonus? God help us if that's the way you think.

    Look, I don't like corporate greed anymore than the next guy, but there is a fine line between greed and hiring the best and brightest minds. If our government starts interfering with executive compensation, American companies WILL NOT be able to compete for the best and brightest minds that come out of our universities. Instead, foreign companies, without interference of their governments, will be able to lure these people away with the promise of more attractive compensation. Remember, most foreign companies can already pay better wages due to the difference in corporate taxation, America being one of the highest.

    America already has laws on the books to prevent what happened to our country. It's just that our government does not hire the right people to enforce those laws. Too many in government are the foxes that are supposed to be protecting our henhouse.

  • Report this Comment On January 30, 2009, at 1:25 PM, dmeredit wrote:

    TMFFlightsuit,

    So should we assume from your comments that, should TMF suffer a major failure in the next 8 years, you will happily refund all bonuses paid to you? No one can predict what will happen in the future, and do you honestly thing (Madoff aside) that the employees on Wall St (CEO's included) thought their business strategies were going to cause their companies to fail? Do you think the government economics professionals in Iceland thought the same? Do you think the same of TMF today?

    Very few people deliberately take actions that they believe and understand to be wrong. In most cases, and particularly in financial services, such actions are criminal, and are prosecuted. That's exactly why such oversight exists.

    And do you honestly think that MPov or I are arguing that a $100 million + bonus for a CEO is reasonable? But to tar the entire Financial Services industry with a "get no bonus and many of you should be locked away" is just disciminatory. It also shows a complete lack of understanding of the Financial Services compensation model where, in many cases, a low base salary is paid under the agreement that the total compensation will include a bonus component.

    And Tom - you never answered my question. What contribution is TMF making / made to the $18B number? Or did you all willingly forego any bonuses to ensure that number was not obscene?

  • Report this Comment On January 30, 2009, at 1:31 PM, dlomax77 wrote:

    If anything, the boards of directors are the socialists. They, the workers, fleeced the shareholders who owned those banks.

  • Report this Comment On January 30, 2009, at 2:09 PM, TMFTomGardner wrote:

    This is a great debate. And I'm glad we're having it. As often happens in Fool.com debates, I think there are pieces of truth sprinkled throughout the comments. . . regardless of which side you're on.

    One of the things that you should not assign to me is a belief that anyone who works at a Wall Street firm should be forced to throw back their bonus or to go to jail. I do not, however, believe -- given the performance and the taxpayer bailout -- that there should be bonus payments getting made.

    To the poster who asked about The Motley Fool, well, as a private company we're not required to reveal our compensation plans. But I can assure you of this, if we had an operatially cashflow negative year, we wouldn't be looking at bonus payouts. Further, if we ever were in position to require taxpayer money to survive, you can be very sure I would stand down on all bonus payments.

    Here's what I am an advocate for -- clawback policies at public companies and clawback statutes available to regulators in cases of egregious behavior. Bank of America/ML should be able to clawback money from Stanley O'Neal. In my opinion, in good faith, he should already have offered to throw it back, in the terminology of Cubs bleacher fans.

    Again, I believe these do help rebuild confidence. The more the marketplace looks merit-based -- and the more this bailout package looks merit-based -- the better. We are living in a suboptimal world, no question. But I'd rather feel it is suboptimal more than that it is, in the word of the Traveling Wilbury's, it's a dirty world, a dirty world.....

  • Report this Comment On January 30, 2009, at 2:56 PM, EFHuttonAlum wrote:

    During the thirteen years I worked in the financial services industry as a retail broker I was never compensated for the performance and returns my clients earned. Broker comp was determined by activity instead of ROI to customers.When Glass Stegall was repealled (shortly after the savings and loan fiasco) I decided to retire from an industry that rewarded generating commissions instead of rewarding creating wealth for customers. IMHO, based on personal experience in the financial services industry, there is a real need for greater oversight and regulation in financial services and banking.

    We must require our elected officials to

    enforce greater scrutiny,moderation and prudence in an industry that is governed and motivated to a large extent by greed. There were exceptions to the rule, who cared deeply about their clients welfare, but they were unfortunately in the minority.

  • Report this Comment On January 30, 2009, at 3:29 PM, rdbpalmer wrote:

    While you’re at it why not hold government responsible for Bernie Maddoff's shenanigans!

  • Report this Comment On January 30, 2009, at 4:25 PM, HGPD99 wrote:

    I don't understand corportate law, but up until early last year all I heard was how Sarbanes-Oxley was causing so much extra paper work and causing companies to be so overly cautious about how they did business that everyone said it was slowing down business growth.

    So, why isn't Sarbanes-Oxley catching any of these CEO's (and others) who have caused these problems?

  • Report this Comment On January 30, 2009, at 6:19 PM, socialconscious wrote:

    Thank you Mr. Gardner! Yes the ring leading scoundrels imho should be sent to jail.Great Gatsby! They accepted bonuses while laying off and causing the layoffs of hunderds of thousands and destroying shareholder value and partcipating in histories biggest scam.Namely betting with parimutual odds(highly leveraged) people,governement and corporate money. Also they averted regulation by calling insurance "swaps". Writing unregulated insurance called CDS they could never pay.

    Today I feel you have vindicated me.Was it you or your associate who coined the phrase" History Echoes?" As in the Great Depression these scoundrels blamed external forces who at best could have a minimal effect for their highly leveraged bets.

    In the Great Depression speculators blamed Smoot-Hawley 2 1/2 % increase in already high tariffs for countries demise. Today the blame eithier the Community Reinvestment Act which has been around since the 70's to stop the unfairness Dr. King was fond of rallying against or Redlining.

    To answer Smoot-Hawley historians I would remind them the U.S. ran a trade surplus almost continuously from 1900 until the 1960s.Also jobs increased in the 20's depite high tarriffs.It is said these easiest solution is usually the right one. It was the bank failures that had the highest causal relationship. Link below on US trade from the US census pdf's from 1878 or so.

    http://www2.census.gov/prod2/statcomp/documents/

    To answer todays folks I would say if the 30 y/o Community Reinvestment Act caused this problem why did it not happen sooner? I also paraphrase what a NY times columist asked who asked Wall street to bet on peoples' mortgages. A-1 and Sub-primes by definition are risky ventures.

    It matter of personal repsonsibility and accountability matters often stressed on the blogs of MF. I present my opinion for it perusal. All best Social

  • Report this Comment On January 30, 2009, at 7:11 PM, rjdingb wrote:

    Ethics, ethics, ethics. Clawbacks, clawbacks, clawbacks.

    Changing ethics will take years to inculcate. A future generation may take up a new ethics standard, realizing that the dreams of better standards of living, education, and heir ship that their parents hoped for them were dashed because the parents were so decimated that they couldn’t pass along the wealth to fund a better future. When those future citizens realize wealth evaporated due to a generational orgy of greed, and an insidious symbiotic relationship of unethical corporate executive classes and government deregulation and non-regulation bureaucracies and legislators, then will ethics change in some likely fanatical way (as it always does in history). And it won’t be pretty or ethical either.

    Clawbacks, are immediately needed. Perhaps a new tax page of reconciliation going back three years, where any employee of any pre-designated IRS identified financial industry firm, must separately report what portion of their compensation-income was bonus money in tax years 2006-8. Then, a separate statement from the firms confirming if said firm was profitable for those years. Then, a surcharge on income from all bonus money amounts received in years where profitability can not be demonstrated. And to be fair to the hard middle management and workers who weren’t so much part of the robbery or looting, a no surcharge tax exemption for the first $50K of bonus, and a rising percentage for all bonus money awarded on a rising scale. I.e. 30% 50K-75K, 40% 75K-100K, 50% 100-200K, and a whopping 90% tax on all money received as bonus of $200K and above. If they already spent the money, in real estate require forced sales. If they blew it on opulence and trappings of superwealth, confiscate the jewels, force disgorgement of country club memberships for whatever equity can be gotten, and do whatever it takes to disgorge them of the luxurious goods of the greed fest, until they satisfy the surcharge on their bonus.

    Do the clawbacks and societal recompense soon, or confidence will be eroded and the markets won’t come back anytime soon. Worse, the next generation who will bear this horrible burden will likely be led by fanaticism when ethics are not only changed revolutionarily, but where morality will go out the window with revenge.

  • Report this Comment On January 30, 2009, at 7:38 PM, bushact wrote:

    We been had online, I been trading since the late 1990s and never seen it this bad.Perfect example was when yahoo allowed bogus financial ratings for what is now ttnp . The insiders swindled me online pumping bogus headlines and a power rating of 1 on yahoo. I called scottrade and tried to explain my case, the representive of scottrade said to complain to amex. I know they got away with stealng using illegal internet advertising. IMHO our govt is truely a type of new aqge mafia that is as dangerous and even more dangerous than the real itailian mobs.

  • Report this Comment On January 30, 2009, at 7:45 PM, bushact wrote:

    I bet I'm not the only one that wants to see bad people on wallstreet suffer like never before! I also have been stimulated to have disrespect for any spy govt org. and I certainly know the enemy now.

  • Report this Comment On January 30, 2009, at 10:36 PM, ilovesum wrote:

    What a joke that now the investor is responsible for his losses cause they were lying crooks . The reason i go to a professional is cause they're supposed to know more than me. I don't go to the doctor and walk away with the impression one of my buddies should do the surgery , THATS NOT HIS JOB !!!!

    If the doctor makes a mistake does he blame the patient for not knowing medicine ?? haw haw haw

  • Report this Comment On January 31, 2009, at 1:00 AM, pgb21 wrote:

    The stock markets are not savings accounts and people should stop thinking they are. While i fully support punishing criminal behavior and beefing up laws, the reality is that investments are risky and individuals must take responsibility for managing that risk / reward balance - including deciding who to trust with your money. If people dont want to spend the TIME managing risk then they must give up expected RETURN. If they dont want to give up RETURN then they must give up TIME. It is crazy for anyone to expect they can invest no time and get a high return. Even the so called bad guys in wall street and mortgage business don't have it that good. Even though it may not seem like it when you write that monthly mortgage check, the banks loaning money are spending a ton of time managing the risk and "earning" the return. They manage bad debt, advertise to attract new biz, and so on. Why do investors feel they deserve something easier and less risky?

    .

    Also, where do people get the idea that you are suposed to be completely and proactively protected against criminal behavior? Granting fiduciary responsibilty to a broker or fund manager is an act that everyone should feel the need to take additional care when doing not one where you blindly trust the government to take care of you. Where did this nanystate thinking come from anyway? It certainly isn't in the Constitution.

  • Report this Comment On January 31, 2009, at 1:41 AM, aleecebrooke wrote:

    Wow- there's a lot of info to absorb here! I for one, wouldn't mind seeing the execs of fallen banks go to jail, but for what, is hard to say. Because they are bad people? Is is expressly prohibited for them to take the money? Probably not, or they wouldn't have done it. I wish that congress would have made a few stipulations before they just handed out billions of our tax dollars to the banks (like NO bonus, NO private jets, NO company paid trips to the islands, ect). But, you have to figure that the folks on Capitol Hill are about as corrupt as the execs themselves, so many were probably cashing in on some level (as heard from rumor and small children).

    Anyway, I think that as leaders in the financial industry, many of these execs should return their multi million dollar bonuses, retirement packages, ect. It would increase faith in the current financial system, and would probably make them much less hated people. Really, who needs that many million to live comfortably? And if they are making that in a year, how much do they have put back to live on?

    I hate to see more government intervention in our society. We already have more laws than can possibly be governed. By making more, you are protecting the little guy, in theory, but realistically, you are taking away his ability to think for himself. The stock market is certainly an investment, but it's also a gamble. Anybody that has played knows that. Well, that's my rant for the evening. Thanks for a great article and debate!

  • Report this Comment On January 31, 2009, at 4:24 AM, Zebra366 wrote:

    I understand the anger at those who we read about in the news and rightfully blame for the misfortunes of many.

    But in fact it was government intervention that created outrageous pay packages based on options rather than direct pay. The government said that executive pay over $1 million could not be deducted as a corporate expense. So the C-Suite executive bonus package, tied to options and the near-term stock price, developed.

    This created an incentive at the top level to manage the price of the stock instead of managing the company. To take risks that would boost net revenues artificially. The excessive leverage and the pure gambling on derivatives that occurred was a natural outcome of a heads-I-win, tails-I-don't-lose form of compensation.

    The fact that private investment firms could create money or credit through leverage was not really the problem for the majority of sane and sober Americans; it was a problem only for the investors and high net-worth individuals who bought into these schemes.

    At least it would have been, until the idiots in government office made up this notion of a company being “too big to fail”. IMHO these companies were “too stupid to survive”. Only their connections with Hank Paulson saved them.

    The real criminals are not the people in the investment banks, GSE’s, or AIG who were responding to their personal incentives. The real criminals are those people in high government office who decided to use taxpayer funds to try to save these grossly mismanaged companies. Bernanke, Bush and Paulson have committed crimes or mistakes that will haunt generations of American citizens yet unborn.

    Read the story of the Tulip Bubble by Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds. In that book also is the story of John Law who helped France to ruin by teaching it how to create fiat money, which is a good tale to predict 2009 and beyond.

    The trading in derivatives, especially Credit Default Swaps has been a story of pure gambling on the part of some formerly staid institutions. They have come to grief just like the Tulip traders of 1636. In that situation the distressed traders appealed to the Dutch government to save them. The government declined to do so and the judges refused to enforce “debts incurred in gambling”.

    The fact is that we could protect the majority of the populace with FDIC insurance and let these incompetent institutions fail. Not only would it be cheaper but we would avoid the ‘lost decades’ that the Japanese created for their country in 1990 when they went down this same road.

    It is often said in investing, “don’t fight the Fed”. Well, this time the Fed has to understand, “don’t fight the market.” These institutions are dead; no amount of taxpayer money will bring them back to life.

    Keynesian economics is also dead and discredited, no amount of taxpayer dollars or credit wasted will change that fact, Keynes is only being revived because it is convenient cover for the government to distribute pork in that name of ‘stimulating the economy.’

    Zimbabwe, Weimar Republic, we are coming to join you.

  • Report this Comment On January 31, 2009, at 8:29 AM, TMFTomGardner wrote:

    Zebra, I would also recommend to you the book "Millionaire" by Janet Gleeson, which tells the full story of the life of John Law, and what he did to the French currency. It's a fantastic book.

  • Report this Comment On January 31, 2009, at 12:54 PM, theta1 wrote:

    The bonuses and perks on Wall St. will continue as long as the system between lobbyists and politicians continues. The greed and the "holier than thou" attitude of our politicians has spread to Wall St. The only ways for the public to send a message to the members of Congress are to,not reelect them, and organize a recall vote against them. We must hold Congress accountable for their poor judgement. If the current administration wants change, this could be a starting point.

  • Report this Comment On January 31, 2009, at 1:22 PM, GoldCanyon wrote:

    Dr. Robert Hare has written an excellent book about psychopaths entitled "Without Conscience."

    He has also developed a test to identify such persons in the corporate setting. It is called B-Scan 360.

  • Report this Comment On January 31, 2009, at 1:48 PM, TMFDiogenes wrote:

    Zebra's right -- we shouldn't give favorable tax treatment to companies who reward their employees with options rather than on other metrics. But 1) the $18.4 billion cited was a cash bonus, and 2) this fact alone doesn't make "the government" the sole villain here. We all share in the blame -- firms who awarded options on short term stock performance rather than long term business performance, executives who sacrificed their firms for tons of money, and investors who aided and abetted the whole arrangement.

    .

    Zebra's also correct that the former administration screwed up the bailout. But that doesn't mean we shouldn't have had one to begin with. I would encourage everyone against rescuing horribly mismanaged firms because they don't buy the "too big to fail argument" read this article: http://www.fool.com/investing/value/2009/01/30/this-bailout-...

    To summarize, the FDIC has about $85 billion to insure all the deposits in the country. WaMu alone had $188 billion in deposits , Citigroup some $600 billion, etc. Had we allowed them to fail, we'd have been on the hook for even more money, and we would literally have allowed the global financial system and perhaps capitalism to fail. That's why the proper way to handle this problem would have been to prevent firms from becoming too big to fail in the first place, with sensible measures like Glass-Steagall and so forth.

    .

    If, like me, you don't enjoy having the government intervene every few years to save the system (LTCM was another recent case), you must 1) limit the size of financial firms to preempt the "too big to fail" phenomenon, 2) limit the quantity and stupidity of executive pay packages, or 3) cross your fingers and hope investment bankers somehow become altruistic on their own. Those are your only choices.That's it.

  • Report this Comment On January 31, 2009, at 2:35 PM, TMFTomGardner wrote:

    Theta, yes, the effects of lobbying on our political system is a national disgrace -- has been for many, many years. What we have to remember is that these bailout packages are heavily influenced by lobbyists pushing for favoritism in exchange for capital to help elected officials get re-elected. We have to slap ourselves awake to remind ourselves that as taxpayers we are never getting a taxpayer-centric plan. . . it is heavily altered by lobbying (aka bribing -- let's just get rid of the euphemism).

    And...great posts, Diogenes.

  • Report this Comment On January 31, 2009, at 7:50 PM, NYMArts wrote:

    Labor Camps were MADE for these Money - addicted bastards.

    I hear Dick Cheney and his Halliburton are constructing the Holding Facilities at this writing.

    The Constant Parade of Captured CEO's into these Facilities will indeed be a Sight for Soar Eyes :o)

    Work 'em Hard 'til their Natural Deaths.

    The Right of the People Shall Maintain.

    God Bless America

  • Report this Comment On January 31, 2009, at 8:26 PM, BillinBoca wrote:

    I'm in Boca in my gated community, in my $7 Million home with my bonus money.

    So are all my friends.

    Next weekend we will be in Vail.

    In capitalism, the strong are permitted to keep spoils far outsized than the weak. YOu people are the weak.

    Our bonuses are secure. Your losses in our stocks will set your retirements back, will destroy your kids educations, and will confine you to minimal existence.

    Do I care.. not really. Can you take my money from me. Ha ha. Try. You can do nothing.

    Get used to it. It's called capitalism.

    Get your frustrations out in this forum. It will make it easier for me in the future.

  • Report this Comment On February 01, 2009, at 2:31 AM, DAfshar wrote:

    Though I'm not as cynical as "BillinBoca" I have to agree with some of the points. Yes, some of the execs should be in jail. Yes, BillinBoca's bonuses are fairly secure and yes, many will continue their minimal existence.

    But, where were all of these people when the markets were booming? Why weren't these comments made then? The answer is PAIN. People and systems don't change until people feel pain as a result of their own or someone else's actions.

    So, will things change? No, most likely not and that's why BillinBoca is laughing to his heart's content right now.

  • Report this Comment On February 01, 2009, at 6:55 AM, BilboBaggins wrote:

    I can think of 535 people who should go to jail. Actually 534...Ron Paul doesn't have his hands dirty. The other 534 members of the House and Senate have done far more to rob the American people over the years than any bank or business could ever dream to do.

  • Report this Comment On February 01, 2009, at 12:33 PM, kamuirei wrote:

    @John

    "Perhaps some of the money should go to mandatory Ethics Classes in the MBA and Finance programs they took."

    A few years back I had a friend taking a business class where half of the class was failed for cheating. The course was business ethics. (No Joke)

  • Report this Comment On February 01, 2009, at 1:02 PM, dmeredit wrote:

    TMFFlightsuit and Tom

    Thanks for your replies. Now we can reach agreement. Do I think that companies who accepted cash from the government should hand out bonuses - no? Do I think that a company that is clearly failing should hand out bonuses - no. Do I think that many of the top Executives at certain Wall St firms were used to excessive salaries, perks, bonuses and spending - absolutely yes - and from personal experience (even down to the private elevators so that would not have to mix with the "regular" employees).

    What I was reacting to was tarring the whole industry with the same brush - and using the $18B as a number to justify the position. Remember - much of this is going to firms that have not asked for or accepted any aid, and for hardworking individuals who do not fall into the categories above. Please, before you slam all of us next time, think about your words. After all, this kind of blanket "all xxx people are yyyy" is what this country has fought so hard to move away from.

    As to the question of clawbacks - I would fully support that in the TARP provisions. Would I support it as a regulation for private/public companies not accepting aid - no. I believe that is up to the board of directors to negotiate into the compensation programs they put in place. And frankly, this is one reason why I sometimes vote against proposed compensation programs as a shareholder (when I am given the chance to do so).

    Anyway - as you say - interesting debate. Back to my taxes....

  • Report this Comment On February 01, 2009, at 3:41 PM, vriguy wrote:

    Bravo!

    President Obama and Congress - Tom gave voice to all of us investors - are you listening?

  • Report this Comment On February 01, 2009, at 3:59 PM, sungrove wrote:

    Damn, after reading all these comments, I'm amazed at all the Socialists and redistributionists that frequent this board. Doesn't bode well for the future. (written by pmbarrett)

    redistributionists, apparently a new word, but I imagine a pretty old idea. I think the idea is that if you keep saying t over and over people will eventually believe it.

    In this case, I guess the idea is, as I've heard it, these hard working people went and made a fortune and now the government wants to take it and give it to the poor lazy people.

    On the surface, I guess it's an understandable lament. In this country, whether it's true or not, we have accepted the idea that if you work hard enough and are smart enough you can and most likely will be rewarded with wealth. So, we end up constantly accepting the agenda of the wealthy because 'maybe I'll be fortunate enough to be one of them eventually'.

    The problem with this is that there is so much more to the equation.

    What makes a country worth living in?

    Is it right or fair or does it even matter that there are such huge disparities in wealth?

    Do even the wealthy eventually want an overall wealthier populace or are they fine with walling themselves off?

    Do the wealthy owe a greater amount of taxes based on the fact that their success partly depends on a stable government environment ?

    I think that the questions like this can just go on and on like this. But how can any wealthy person objectively look at what has taken place over the last ten years in this country and still think that we have a wealth 'redistribution' problem? According to the World Institute for Development Research ( http://www.gizmag.com/go/6571/ ) the richest 2 percent of the worlds population owns half of the worlds wealth. Most of that wealth is in the United States, Canada, Europe and Australia.

    The wealthy have also totally won the framing battle. To be able to effectively frame the wealth debate to say that the wealthy are threatened by 'redistributionists' one would have to think that the middle class and poor somehow had enough lobbying power to get the ear of Congress, enough thinktank power to reframe the debate, or even enough time to deal with any of it since for many it's just become a survival exercise.

    No, I think the redistribution of wealth has been and probably will continue to be from the bottom up. Every time a guy earning minimum wage goes to work and works hard for a company wealth is being transfered upward. Every time a lobbyist gains some favor from our representatives for everything from football stadiums to Boeing tax breaks and bank bale outs, money is flowing from the bottom up.

    So, where is the outrage in all of this at the lobbying power that has not only created a bank bailout process but left it with apparently no strings attached?

    If it were up to me, I would say to bankers and other execs, OK live by your retoric. Allow your business to fail just as you wanted no government intervention while it was succeeding.

    Left totally to the market place, would we ever get any kind of true information about companies with which to invest? And isn't this something that a capitalist finds to be just as important as anything else?

  • Report this Comment On February 01, 2009, at 5:26 PM, TMFDiogenes wrote:

    "Left totally to the market place, would we ever get any kind of true information about companies with which to invest? And isn't this something that a capitalist finds to be just as important as anything else?"

    Well put, sungrove. It's especially at times like these, when our nation has the power to remake our world or let it unravel, that we must remember: Capitalism is no more "natural" than Hobbes' state of nature. However desirable many of us find that particular system, we should keep in mind that it doesn't come about on its own, nor is it self-sustaining. Humans created it, and it takes humans to maintain it. What exactly that entails -- clawbacks, bailouts, lobbyist reform, reshaping Wall Street's culture, preempting "too big to fail" by limiting size and failure (ahem - leverage) -- those are thorny questions. But I think we can all agree that taxpayers can't afford to continue letting (certain) Wall Street executives decide what rules of the game are best for the country.

  • Report this Comment On February 01, 2009, at 10:38 PM, sungrove wrote:

    Billinboca wrote:

    I'm in Boca in my gated community, in my $7 Million home with my bonus money.

    So are all my friends.

    Next weekend we will be in Vail.

    In capitalism, the strong are permitted to keep spoils far outsized than the weak. YOu people are the weak.

    Our bonuses are secure. Your losses in our stocks will set your retirements back, will destroy your kids educations, and will confine you to minimal existence.

    Do I care.. not really. Can you take my money from me. Ha ha. Try. You can do nothing.

    Get used to it. It's called capitalism.

    Get your frustrations out in this forum. It will make it easier for me in the future." end quote

    way to go Bill,

    congratualations on your successful scumbagery. I don't really believe in hell. But what would the point of that be, you and your fellow jerks are busy making it here on earth.

  • Report this Comment On February 02, 2009, at 8:28 AM, TMFTomGardner wrote:

    In reply to the comment about ethics courses, if this fiasco doesn't force the top five MBA programs to make meaningful changes to their curriculum, that's a real shame. These have been the feeder schools to Wall Street, and the compensation plan on Wall Street (changeable over time by these graduates) set the whole structure up for collapse. The one-year monster bonus, it turns out, actually does motivate unethical behavior.

  • Report this Comment On February 02, 2009, at 2:26 PM, denlong wrote:

    Free Markets ALWAYS favor the big players

  • Report this Comment On February 03, 2009, at 5:00 AM, antonacid wrote:

    Hey Tom,

    Although I agree with you in principle, I don't think sending these guys to jail is the solution. They have in fact done no crime. They've only used the system they themselves have so cleverly designed. You didn't offer any solutions to this magnificent problem. May I suggest a few? The real problem of the Corporate Capitalist System, is that the roosters are running the hen house, and the fox's are their best friends. The laws that govern corporations are intrinsically flawed. The Boards of company A are the Execs at companies B and C, and the Boards of B and C are the Execs at company A. Additionally, the Board of Directors set Executive compensation, while the Execs generally guarantee the pay and perks of the Boards. Either directly or indirectly, this is how the game works.

    One simple law could change this for the better. The law being that no one can serve as both an executive at any company while serving on the board of another. Another law would state that to be on the Board you would be required to be a substantial "purchased" stock holder, rather than a compensated stock "taker".

    I'm all for reasonable and considerate compensation for performance, but this current system of corporate governance and greed is grossly absurd and pathological.

  • Report this Comment On February 03, 2009, at 11:52 AM, joseroncal wrote:

    On his ninth day in office, President Obama took a broad swipe at Wall Street, calling the $18.4 billion in bonuses for 2008 "the height of irresponsibility" and "shameful." He said that Wall Street had come to the government for badly needed help and that taxpayers provided the funds to prevent a further meltdown, but that Wall Street had returned the favor by acting completely irresponsible instead of showing restraint and discipline when the rest of the country is dealing with economic hardship.

    His remarks sparked a lot of reaction by others who were armed and ready to lash out at Wall Street. Senator Chris Dodd (D-Conn.) the chairman of the Senate Banking Committee has threatened to confiscate the bonuses, Senator Claire McCaskill (D-Mo.) wants a $400,000 compensation cap for executives whose companies participated in the government bail out, and New York Attorney General Andrew Cuomo said he might ask for the return of the $4 billion in bonuses paid by Merrill Lynch & Co. just before being acquired by Bank of America Corp.

    Conversely, others felt that the term "bonuses" was a mischaracterization and that the money actually fell into the category of commissions and incentives paid to sales teams and operational staff, rather than being exclusively doled out to top executives. Needless to say, it was the lead story for all the news pundits and a hot topic for bloggers.

    But I think everyone needs to widen the lens here because we're missing the bigger picture. My concern is that once again Washington is reacting under pressure and pushing Obama's stimulus plan without first having a strategic framework in place—a plan that would form a basis for prudent decisions, something that stakeholders could align with and support.

    We are told that there is no time to waste; that things are getting so bad, quick action is critical, that we don't have a moment to lose. If things are that bad, which by all accounts they seem to be, then all the more reason to step back, take a deep breath and send a task force into retreat to think this thing through.

    I'd like to know whether or not the money we doled out to the banks included any preconditions regarding bonuses. If not, then, sorry folks, but we the government are stakeholders, and the boards, the CEOs and executives are running the show.

    Banks are not lending any of the bailout money, but it's my impression that this was the intent for giving them the bailout money in the first place (if, in fact, preconditions to do so were actually included). I'm not sure what the stipulations are regarding the next chunk that's slated for corporations. But I do know that when you give out freebies without a watchdog and clear rules of engagement, corporations will waste taxpayers' money and return like Oliver Twist with, "Please sir, may I have some more?"

    This sudden outburst over Wall Street bonuses seems like too little too late and however it shakes out, it isn't likely to do much to get the economy moving or put people back to work. Let's put this in perspective. Whether warranted or not, bonuses are just the tip of the iceberg. I'd like to know how much more of the taxpayer bailout dollars have been squandered and where.

    Talk is cheap and while the attention right now is on $18.4 billion, there are bigger fish to fry. How about the burden of the national debt—which is somewhere in the trillions—or the falling home prices with foreclosures at record highs, and unemployment running rampant? On Friday, as expected, the GDP shrank by 3.8% but it could have fallen to 5.1% as the output was boosted by a rise in inventories of goods that were produced but not sold in the fourth quarter. So excluding the inventory adjustment, GDP fell at a 5.1% rate, which economists say more accurately reflects the nation’s weakness.

    This economic crisis transcends political parties. Both Republicans and Democrats have a stake in the outcome and right now both parties are parading their shortcomings. But I'll withhold judgment on Obama's stimulus package until I see a detailed breakdown. At that point I'm sure I'll have plenty to say.

    If you found this article helpful, visit www.financialspeculation.com to claim your own copy of Jose Roncal’s popular FREE REPORT, “12 Keys to Smart Speculating in Tough Times.” It’s chock full of valuable insight on how to rebuild your nest egg. While you are there, check out “The Big Gamble: Are You Investing or Speculating?” See for yourself why Donald Trump has called it “a great read!”

  • Report this Comment On February 03, 2009, at 3:49 PM, vmgator01 wrote:

    I disagree. THOUSANDS not hundreds, should go, not to jail, but to work farms to earn their bread the rest of their life, with all of their, and their families, assets confiscated.

    vmgator01

  • Report this Comment On February 03, 2009, at 5:51 PM, dave20011 wrote:

    They are all filth total absolute filth and may they all rot in a living hell. I can't emphasize my repulsion for these scumbag reptiles.

  • Report this Comment On February 03, 2009, at 6:08 PM, ecoloney wrote:

    One cannot follow the god of this world AND have any ethics.

  • Report this Comment On February 03, 2009, at 6:40 PM, rojoreno wrote:

    i used to be proud of the USA's democracy and free market system--but "the smartest people in the room" be they political, and/or business leaders have used and abused it for their self aggrandizement; selling their souls and selling out the citizenry to the highest bidder in the name of greed. I am at a loss, I;m hoping that the pendullum will swing the other way---but I would have thought that the USA was a little more advanced and not have devolved to a society where ethics are scarce.

  • Report this Comment On February 03, 2009, at 7:23 PM, SoSuMeNJ wrote:

    So Tom covered a handful of the financial/corporate thieves by name (bravo) and gave specific, nauseating amounts of money they stole and continue to steal from us directly, or indirectly by causing this economic collapse.

    Maybe David could write an article about the government thieves whose names deserve to be named, the specific deeds they did (and are doing), and the amount of money they earn(ed), including what they're worth today.

    Most, if not all, Government officials (and employees!) today "earn" well above the national average and many are millionaires many times over, including members of Congress and Senators. They get lifetime benefits, the likes of which I will never "earn" as a private sector employee, no matter how long I work, including full medical to which they make no contribution, full lifetime pensions (no contribution), etc. all paid by taxpayers, the vast majority of which don't get anywhere near these same benefits.

    Former Presidents accept pensions in the millions (from taxpayer money) even though they are all already multi-millionaires and earn more millions giving speeches. Talk about, "where is the shame?"

    Between the corporate and government thieves, irrespective of party affiliation, we are destined to continue down this bottomless pit of financial despair until somebody (sorry, not Obama, based on what he's done so far) actually says "ENOUGH!" and recognizes that the taxpayers (non-government-employees!) need the biggest bailout of all; we simiply cannot afford to continue paying these government employees their millions in wages and benefits!

    And, last but not least, have you TRIED to get a government job these days? If you think the tax code is an out of control mess, take a look at one of the government job application websites and try to apply for a job. I dare you.

  • Report this Comment On February 03, 2009, at 7:32 PM, jprental wrote:

    you are so right we do have to act. but calling these jerks is not enough. there is enough laid off people in this country to form a march on washington. we need to make our case in person. the more people that do this the more they will listen. our whole lives are going down the drain but the politicians are all millionaires . they dont care about us. during the revolutionary war they had the boston tea party. we need the tar and feather party . and when we are done we throw them all in the potomac. but we have to act now.

  • Report this Comment On February 03, 2009, at 7:40 PM, papamikekilo wrote:

    This discussion seems to be missing the most salient point. The real issue is not compensation, or clawbacks, etc., it is related to fraud.

    Any company that engaged in "off-the-balance-sheet" or "off-the-books" accounting, or the creation of "shell companies", or similar antics which resulted in hiding information from shareholders, investors, and/or the regulators is de facto guilty of fraud - this applies to the executives, the boards, the accountants, and the auditors of said companies as well.

    Jail time and TOTAL compensation clawback (in terms of fines) for these individuals would most certainly be appropriate.

    The fact that many of these obfuscating strategies are claimed to be in compliance with GAAP is indicative of the fundamental rot in the financial system as a whole.

  • Report this Comment On February 03, 2009, at 7:57 PM, megadrone wrote:

    1.) I agree that all the CEO's, CFO's and all other corporate big wigs that commited crimes should go to jail.

    2.) I agree that "All" politian's are at fault, not just Democrats or Republicans."All" of them from the Presidency on down to the lonely county commissioner. Reagan, Clinton, bush & Obama. They are only doing what they need to do to get re-elected.

    Now, with that said, I have not heard anyone take personal responsibility on any of these forums.

    1.) The individualds taking advantage of the so called Varible Rate, Interest Only & the infamous "No Doc" loans on homes that they know they could not afford. Are they Criminals? I would say so.

    2>) The individuals taking advantage of the so called Varible Rate, Interest Only & the infamous "No Doc" loans to flip homes for an investment when they knew they had no idea what they were doing. Are they criminals? Again, I would say so.

    2.) The individuals that ran up major debt on 10's of credit cards that they knew they would never be able to pay off. Are they criminals. Again, I would say so.

    In this country we do not have "Debtor's Prison" any more. But we still have laws against "Fraud" for lying about our financial situation.

    Buffal0Bill Wrote:

    "The more we try to banish God from our society the more our corporations and institutions will fail because more and more of the men who lead them will have no regard for God and His principles."

    Will let me tell you something. They start out every session of the house with a prayer, they start out every session of the Senate with a prayor, the Presidents swear on a bible when they are inaugurated (even though our constitution does "not" require it. Our constitution plainly say's "There shall be no religous test for holding public office", but we do require it,try saying your an "Atheist" and see how far you get in public office. Our prisons are full of God fearing individuals. 100's of priest's have been convicted of child sexual abuse, so don't give me that religous crap.

    The real solution for keeping this from happening again is "Education". We need to educate ourselves, and we don't have to have a degree to do this, for example, I don't have a college degree. I have learned what i know from the school of hard knocks and reading everything I can get my hands on. I make a comfortable living close to a six figure income. I own my own home, have 3 new cars (all paid for) and no other debt. I'm in my 40's

    Oh yea, I'm also physically handicapped and am still employed by the same company. I have never ever taken a government handout.

    I believe the biggest problem with our society is instead of being leaders, the majority of society are blind followers. If you don't believe me listen to Rush Limbaugh and all the "Ditto" heads that spout his exact words and have no ideas of their own. And the leftist liberals that believe that if the "Media" says it, it has to be the truth.

    Alright i'm done with my rant.

    Just one more thing, We get what we deserve...

  • Report this Comment On February 03, 2009, at 8:43 PM, doucme2005 wrote:

    Agreed regarding bankers. I would also extend these comments to the worthless who took these loans knowing they could not repay, to those who walked away from mortgages because they were underwater, not caring in the least about their obligations, to the players who thought they could buy a house today and flip it next month for 10% profit.

    Lets not leave out the government, who through fannie and freddie fostered and encourage high risk lending (so called sub prime loans) and to legislational changes that made it possible for banks to again get involved in practices that had been rightfully banned since the last depression. Lets put these idiots in jail too.

    Plenty of blame to go around but at the end of the day the blame rests squarely with those who took on obligations that they either can't---or growing more all the time---won't honor.

  • Report this Comment On February 03, 2009, at 9:30 PM, graceupongrace wrote:

    The key issues being missed are human nature and morals. We've taken the Bible out of schools. Let's not talk about right or wrong because there are no absolutes. This is man at his finest. This is what we do when we don't think there is a God to whom we are accountable. There is a hell. This isn't it. No one is going to get away with anything. Until a person's nature is changed, their actions cannot change. Yes, the truth is hard to accept because it starts with each one of us realizing we do the same things: we all lie, cheat, and hurt other people. The solution: Jesus.

  • Report this Comment On February 03, 2009, at 10:56 PM, foolish14U wrote:

    That these guys were and are greedy beyond reason goes without saying. Imagine running a company into the ground and receiving a golden parachute on the way out the door. Everyone is talking about this and we may see a revolution if Congress doesn't act soon to stop the greed.

    How about a 100% tax on compensation in any form over say $5,000,000,000 per year for any public company employee. I also like the idea of those only owning purchased shares having seats on the compensation committees of public companies. It's a good old boys network now that perpetuates the greed.

  • Report this Comment On February 04, 2009, at 4:41 AM, rider00 wrote:

    I think the best action to take (perhaps a 7th option) is a boycott. When we really hate a company, we don't buy their products. So pull all your money out of these corrupt mega banks and use small, local banks (they're still FDIC insured). In fact, you can even keep open a free checking account with no min balance that you use for bill paying. Only deposit enough money via ACH (free) transfers when you need to write checks. Then you can actaully be a financial drag on these banks. If we deny them of our deposits, they will wither and die. And for God sakes, now that the investment banks have converted to bank holding companies, they will look for deposits. Please don't aid them no matter what free toaster or other fancy offer they provide for opening an account.

    I would also boycott any smaller banks that have been bought out by private equity shops (such as JC Flowers buying up IndyMac). These titans of debt pillaged the system as well.

  • Report this Comment On February 04, 2009, at 9:07 AM, changeisgood wrote:

    What happened to bonuses being a reward for simply profits?No profit,no reward.What happened to accounting practices and audits to be used to make sure a business reports acurately and honesly to reflect the true bottom line. You should use an accountant to protect your business and make sure your company is making a profit.they should not be used just to hide facts from stock holders and the tax man. Think about it! All these banks should have been reporting losses. Instead they tricked themselfs into paying taxes on profits that are not there.Truth in accounting would be a good change.

  • Report this Comment On February 04, 2009, at 9:13 AM, megadrone wrote:

    I am happy that the President is finally limiting the pay of executives that took bailout money. He needs to put more controls on these companies.

    Note to all Rush fans:

    No this is not socialism. He's only limiting pay for executives that are taking money from the government, not all companies. If these companies filed bankrupcy the judge would limit the pay and bonuses.

    To graceupongrace:

    You might lie, cheat, and hurt other people, I personally don't do any of these things I know that I have to answer to myself when I look in the mirror every morning. It's people like you that convince me that I made the right choice. I am an Atheist.

  • Report this Comment On February 04, 2009, at 11:12 AM, DGrelle wrote:

    The Boards of Directors on these companies hire the CEOs, set the compensation packages, and are have to agree to the path that the companies follow. To compound the problem they also serve on each others boards. The individuals on the boards are responsible for this mess more than anyone and should be prosecuted - after they pay back the stockholders and the federal government (If the government gave them money).

  • Report this Comment On February 04, 2009, at 11:34 AM, ulvy1 wrote:

    Lets just do it the old fashion way and tar-n-feather these people.

  • Report this Comment On February 04, 2009, at 12:01 PM, megadrone wrote:

    Is it time for a good old fashion "Revolution"?

    What do you say?

    Kick everybody out?

    Term limits for our polititians?

    Only 1 term for the new ones?

  • Report this Comment On February 04, 2009, at 2:55 PM, TMFKnightly wrote:

    bunngolf made this comment on another article (http://www.fool.com/investing/dividends-income/2009/02/04/st.... Thought it was worth including here as well:

    It is interesting to note in today's article from AP regarding announced restrictions on executive compensation by the government that.............

    "The pay cap would apply to institutions that negotiate agreements with the Treasury Department for "exceptional assistance" in the future. The restriction would not apply to such firms as American International Group Inc., Bank of America Corp., and Citigroup Inc., that already have received such help."

    http://finance.yahoo.com/news/Obama-caps-executive-pay-tied-...

    Incredible! Reward the institutions that need to fail to cleanse the system.

    BG

  • Report this Comment On February 04, 2009, at 8:07 PM, NorseWarrior wrote:

    Make no mistake, those of you who see 'guv-mint' as the problem...there were VERY cozy relationships between the firms and the regulators. The politicization of the regulatory agencies over the last decade has contributed significantly to the loose oversight. It's not about more or less regulation; it's about effective regulation. That will only happen when those who are charged with oversight do not have intimate ties with the regulated institutions.

    RJW

  • Report this Comment On February 04, 2009, at 10:40 PM, MariHelen wrote:

    We all seem to have some sort of problem identifying what crime has been committed here. Why is that? Isn't it obvious that we are talking about a form of theft? We need Congress to define it as such, for the Supreme Court to test it, and for the Administration to enforce it.

    Make no mistake about it. A person who takes millions while losing billions of other people's money, while in a position of financial and public trust, is accountable for those losses. No friendly board or previous hiring agreement should take precedence over the financial statements of loss. No executives should be eligible for any extra compensation, stock deals or bonuses if their shareholders lose money.

    Wall Street Welfare must end. They are not the Americans in need of our support, nor the protection of our laws.

  • Report this Comment On February 05, 2009, at 8:05 AM, alfredh1 wrote:

    My proposal for a rule is:

    1) Define a factor for the max range of compensation packages in a Company!

    (This max factor in US is ruled by law,

    the staggering is defined in the company by its shareholders).

    One example is very easy to calculate: lets say max factor=1000 => so with a min salary of 1000$/month for the poorest guy, the highest executive may get a 1000000$/month salary. If you then just state this includes all extra benefits and bonusses and stock options, then almost every company could save lots of money...

    2) Define a factor for min+max compensation of people for leaving a company:

    example: as easy as is --- use the monthly salary and multiply with a factor of working years on that company, and if you want, then multiply with a additional X-factor (equal for all employees! in that specific company).

    If you then state: this min+max X factor is ruled by law for all companys in US, the x-factor for the company is defined in the company by its shareholders).

    This will solve almost all problems with compensation packages...

    Why?

    Because every benefit increase for the exec's has to stay conform with the compensation factors...

    You would have a easy rule which limits the enormous compensation increases of boards...

    And the compensation packages when board members leave are defined and fixed and correlated to their responsibility they had in their position and the work they had done (when you think the monthly compensation is correlated to their actual responsibilitys)

    Easy rules - easy to report in a financial sheet, easy calculations when there is a pay increase/layoffs etc.

  • Report this Comment On February 05, 2009, at 11:46 AM, gebanks wrote:

    We have a minimum wage, why not a maximum wage? Maybe it could be set at 100 times the salary of the lowest paid worker in the company. Why does this country have such obscenely paid executives. This myth that they couldn't find anyone with the talent to do it is rubbish. Plenty of people would be qualified to do at better job than these clowns. It isn't rocket science.

  • Report this Comment On February 05, 2009, at 3:09 PM, remfin101 wrote:

    gebanks:

    Brilliant. But we can't stop there, can we? I think not. Since baseball and football are granted "monopoly" privileges by the USA, they have to be included, yes? So, based on your plan, if the lowest paid employee for a baseball team makes $8/hr (and I'm being generous, actually, because they don't work 52 weeks a year), A-Rod can only make $1,664,000/year. I'm good with that. Also, since "plenty of people would be qualifed" to entertain us, we can't let them escape. Of course, the lowest-paid job in Hollywood might be around $20 grand, so that means Oprah has to fork over $273 million (we let her keep $2 million), 50 Cent gives up $148 million, Spielberg says buh-bye to $128 million (although he may get some special dispensation 'cause he got hammered by Madoff, I dunno), oh the humanity!!! even Tina Fey would have to give up $2.6 million. But hey, everyone's gotta do their share, right? We're just spreadin some of that wealth around.

  • Report this Comment On February 06, 2009, at 11:35 AM, dancingfish wrote:

    Tom, I agree entirely with the sentiment of your article. I would love to see some of the worst offenders (Mozilo) go to jail for life as they so richly deserve. They key to this catastrophe, as you noted, is the incentive systems established by top management. But culpability does not stop at top management. Many, many employees took full and heartless advangtage of the incentives with full knowledge their actions were, at best, unethical. The problem is that we cannot legislate ethical behavior without going beyond the requirement of proving intent. That is a very slippery slope that I hope we do not slide down. Something, clearly, needs to be done to . I believe that a new regulatory system is needed that focuses on the incentives corporations can provide to their management and employees. This was at the heart of the housing/financial crash and is what needs to be addressed.

  • Report this Comment On February 06, 2009, at 12:01 PM, czbill wrote:

    FIGHT BACK. Don't pay any more in taxes than you absolutely have to. Use regional banks that have strong balance sheets and stronger customer service.

    I seem to recall that certain execs in the telcom and energy sectors went to jail. Ebber's wife bemoans the fact that "no one understands what her husband went through..."

    I do. I lost my 401K with that ****. And he belongs in jail as do the execs of the banking industry.

  • Report this Comment On February 06, 2009, at 12:42 PM, jake1943 wrote:

    Great article about greed, stupidity, ect. I believe there should be criminal charges. However, what was missing is the fact that prior to this greed and stupidity there were Govt. Sponsored Enterprises which were the root of this crisis. Politicians were aware of these problems and side-stepped them. Politicians obstructed reform of Fannie Mae. In hearings of the House Financial Services Commitee and Senate Banking Committee many Democratic Senators and Congressmen completely ignored what was unfolding. These are the same people involved in the stimulus package. There are rocks that are smarter than the majority of these people. Rep. Barney Frank is a poster child for term limits. What were his qualifications other than seniority?

  • Report this Comment On February 06, 2009, at 1:45 PM, Tinka82 wrote:

    Hooray, Tom Gardner!

    These things have needed to be said for a long, long time. While I would not venture to say profit is a dirty word, it's long past time to quit rewarding, coddling, and catering to this beast we call our banking system. The market structure has been heavily weighted in their favor for a long time.

    As a real estate appraiser, I can attest to the ethics issues and problems that exist in the system and are largely ignored by the regulators. Honest appraisers have been avoided for assignments in favor of more 'compliant' appraisers to get the deal done. The engagement of the valuation provider is often done by individuals that really aren't interested in knowing the truth, but are either directly obtaining a commission or working for a party who is counting on the loan to close and doesn't get paid if it doesn't. Most times, the only party who'd be left holding the bag when the truth of a faulty valuation was revealed was often the investor who had no control or involvement in the engagement of a valuation professional.

    Why Franklin Raines, Jaime Gorelick, Angelo Mozillo, and others mentioned in this article are still walking free is beyond me.

    As citizens and consumers, we need to be putting the pressure on our elected officials for justice. Further, we need to be cognizant of which companies are and aren't ethical and QUIT doing business with those that fail the litmus test. We each have the power to hit them in the profit center.

  • Report this Comment On February 06, 2009, at 2:11 PM, wgaudreau wrote:

    jail or boot hill .......either one would be OK with me

  • Report this Comment On February 06, 2009, at 2:59 PM, FoolKMP wrote:

    I have read many posts to many blogs similar to this one. In addition I have spoken with a fair share of people from all walks of life recently, and with very few exceptions, eveyone is hurting, some very, very badly. There is a very large simmmering, almost boiling over discontent is this country that I think will reach a breaking point if the new administration and the new congress underestimate the will of the people. It could very well come to a revolution of some sort, and I'm not talking about a nice boycott. The people are downright pissed and eventually that will result in some very unpleasant scenes televised on CNN as the people take out there frustration on elected officials, and corporate executives.I would hope this does not happen, but a mob thinks differently than an individual, and the mob is very, very unhappy.

  • Report this Comment On February 06, 2009, at 3:07 PM, LongLookNH wrote:

    The only people in the news the past year that deserve the millions of dollars of bonuses paid to failed bankers are the pilot and crew of US Air Flight 1549. These are professionals without any ego who do the job year after year and solve a problem when they encounter it. If Captain Sully was a banker, they would have paid him millions if there were no survivors of the "water landing".

  • Report this Comment On February 06, 2009, at 3:11 PM, TimeForATeaParty wrote:

    Jail? Are you kidding? I won't shed a tear as these people start getting BLOWN away !!!! They are SOULLESS !!! Let me open your minds a little. I'm middle aged so I have some time. Have you REALLY thought about the elderly that have worked all their lives believing in the American Way. At 75 plus years old, what are they supposed to do, GET A JOB? What are they supposed to do about food, medicine, health care, etc. Just the mental stress and anguish will kill many.The government and Wall Street are responsible. So many knew what was going on and they either turned their eyes or were complicit.

  • Report this Comment On February 06, 2009, at 4:00 PM, JaxToTheCall wrote:

    The system of greed and corruption, and those who created them, ran them and fine-tuned them will get worse than jail.

  • Report this Comment On February 06, 2009, at 4:17 PM, kerammf wrote:

    They are talking about bonuses.

    I am talking about executions at least some of them.

    That's what they do in China.

  • Report this Comment On February 06, 2009, at 4:24 PM, DS2MTP wrote:

    SHAMELESS is an understatement! The government says they are not going to do anything about the $18.4 billion in excessive bonuses. They are only going to limit the companies that take the new bailout. The president doesn't have a clue about leading this country, period! The government failed the American people and has done so for years. You must instill investor confidence in the market by enacting laws and regulations that limit excessive compensation and bonuses to executives. What happened to the checks and balances for the banking industry? That's right, they were revoked back in 1999 because banking lobbyist convinced lawmakers that the industry and free market could police themselves! Is this 2009 or 1929? Why should CEOs be paid for bankrupting the very company they are in charge of? Collectively, we all feel the same crunch in the economy, it just impacts the wealthy far less than the poor.

  • Report this Comment On February 06, 2009, at 4:30 PM, qwertypo wrote:

    STOP !! Take a deep breath - Back up and take a look at the Big Picture.

    CEO's are not the ones to blame.. It is the Board(s) of Directors that elect or appoint or hire them that are as much to blame if not more so.

    Take a look at any big corporation and you will see that the Board Members are usually CEO's of other big companies and therefore it is business as usual in the "good 'ol boy network".

    A Board of Directors is responsible for the Company that they represent and therefore are responsible to the employees and owners and shareholders of the Company as to who they put in charge of running the day to day operations of the Company.

    It is totally IRRESPONSIBLE for a Board of Directors to enact or put in place any form of an Incentive Package for anyone that works for the Company or is hired to direct the Company that is in any way not directly connected to their performance or to the PROFITS of the Company.

    In other words.. if you fail to make the Company profitable then all you get is a measly salary.. BUT .. if the Company makes a BIG PROFIT then they can make a 'Bonus' based as a PERCENTAGE of the PROFIT.

    Most of these Boards of Directors are "greedy" too and they want to hire someone who 'supposedly' has taken another company to big profits. They fall all over themselves in trying to lure this person to their Company and they FAIL to put in place any assurances that this person has to perform well at all. It is a 'feeding frenzy' of no equal... WE WANT YOU these Board of Directors say... here's your jet airplane.. here's your 50 Million Dollar Salary.. here's your 150 Million Dollar Severence Package. Where is the GUESS WHAT... You don't get any of these UNLESS the Company makes at least 300 Billion (after taxes).

    Oh well... most members of Boards of Directors have it where their pockets get lined with money whether or not the Company makes any money or not.

    Oh yeah.. I forgot the investors.. The majority of you are STUPID.. STUPID.. STUPID.. to have even invested in the likes of any company as I have described above. Most of you are like SHEEP.. You don't care where you are going as long as someone else is leading.. you just go along with the flow. You don't base your buying and selling of your stocks on anything substantial at all.. if the Fed Chairman appeared before the House or Senate and 'wiped his nose'.. Stocks would immediately fall.. if he laughed at some nonsensical joke.. Stocks would immediately go up.

    BOO !!! Gee did that scare you? Did you sell?

    If I were to say that Paris Hilton is buying ENRON stock most of you would be on it like flies on s---.

    Don't blame the greedy CEO's .. EVERYONE who "plays the Stock Market" is just as bad. Get a REAL JOB that earns you real money.. and Invest a little bit - and let it sit - for your future. If you like a high stakes 'game' then go to Las Vegas.

    How can we "Invest in America" when we have leeches sucking it out just as fast or faster than it is going in??

    Where is the "Incentive" for a business to grow and then give back to its Investors?? If I were ever to want to capitalize and start a business.. I sure would not want public investors.. I would make it 'private' and only for those who believe in me for the 'long haul' and won't be bailing on me when the occasional 'dips' are encountered.

  • Report this Comment On February 06, 2009, at 5:19 PM, BearOfTheSW wrote:

    Unfortunately there is not a lot to say about WS executives (CEOs and about 3 layers deeper) that can be said within he Fool guidelines. There is no doubt that GREED is their single mantra---ME,ME,ME..oh yeah, and my friends on the board. Don't forget the Board Members who approved the compensation packages! (for each other). If there is a way to put some of these folks in Jail--lets find it.

    As for all the mortgage problems--these we can ID the culprits fairly easily--start with real estate salespersons, then brokers, appraisers, loan officers, and up the scale. They all knew they were doing the wrong things==but everyone else was doing it too. Easy when the people you associate with in business are Greedy and Uncaring too.

    Now the Nation is in great peril--and they all sit on their ill gotten gains and watch the rest of us try and deal with it.

  • Report this Comment On February 06, 2009, at 6:14 PM, swantly wrote:

    qwertypo:

    I think to say all those who invest in stocks are equally to blame is ridiculous.

    This is not Las Vegas. When you buy stock, you buy a piece of a company. The management of the company has a responsibility to the shareholders to operate the company in a responsible manner.

    If the police stood by while crimes were being committed and did nothing, would you say the victims were just as much to blame as the police? The point is these people who ran the companies had a job to do, and rather than take the shareholders' interests in consideration, they were deceptive and unethical. That's the sad reality. If you blame the shareholders give your head a shake.

  • Report this Comment On February 06, 2009, at 6:31 PM, lonewolfstudio wrote:

    If it smells like a duck, walks like a duck and quacks like a duck it must be a duck. The only law at work is "(S)He who contributes the most to a campaign fund will control their own destiny". Where was the SEC?? Forget jail time. If eternal damnation were a viable option, I say: YEAH! I would advocate having the courts or the FBI investigate the SEC. Jail THEM and, then replace the losers with a more powerful organization with authority and real power to BLACKLIST and prosecute ALL those responsible. If criminal charges are not a viable option (thanks to the SEC), provide access and funds to bring suit against all of the individuals in the decision loops of these companies, without qualification. If that cannot be done, then democracy and the capital markets are officially DEFUNCT.

  • Report this Comment On February 06, 2009, at 6:39 PM, Kensdumb wrote:

    Tom, How about blaming the real culprets ... CONGRESS. They are the ones that should read the Constitution and stick with only the programs detailed therein. Let the private sector go (Moses would like that)

  • Report this Comment On February 06, 2009, at 7:32 PM, Kensdumb wrote:

    Hey Tom, Put the blame where it belongs - Government! Who mandated "Affordable Housing"? Democrats (socialists) in the Congress. Read Barney Frank, Chris Dodd, et al. They are the ones who should be made to "walk the plank."

  • Report this Comment On February 06, 2009, at 7:33 PM, MrMarcus65 wrote:

    Better still, eliminate the Community Reinvestment Act, and that way congress will be unable to force the banks to overlook their underwriting guidelines going forward. Imagine a world where buyers are actually required to qualify for a loan, instead of the feds forcing banks to loan without predjudice...

  • Report this Comment On February 06, 2009, at 7:38 PM, piinob wrote:

    Every one wants to blame the Government for this meltdown. The subprime mess is less than ten percent of it. The rest is all derivative based and the blame for that is with the folks who did not want to regulate and oversee what the crooks at the banks were doing. Get a grip on reality folks. Do you really believe Greenspan when he says he never imagined that the bankers would do something NOT in the best interest of their shareholders? If you believe all that crap you deserve to be screwed out of your money. Sounds as if everyone here has been listening to the hypocritical drug addict like Limbozo.

  • Report this Comment On February 06, 2009, at 7:41 PM, Runningamok wrote:

    Its fascinating to read this debate by investors in America from the UK where we have our own small bank problems. As Brecht said in the Threepenny Opera " Dont rob a bank ..Own one!" Today I looked at the Congressional Oversight Committee report which notes how the US Treasury in the first Bail Out paid the banks...like $100 for just $66 of value for the tax payers whereas private investors like Warren Buffet got $123 of value. Something wrong there and clearly the committee are upset at the way the Treasury and therefore the whole country got taken for fools by the banks even when they were in deep trouble. The bonus scandal just adds to it and shows what deeply ingrained rogue capitalist greed ethics will do. They really do have no sense of personal shame or idea of a benefit to society. As our own dear Mrs Thatcher once famously said " There is no such thing as Society" Well its up to society to prove to the Masters of the Universe that actually there is such a thing and that it will not be taken for a fool...

  • Report this Comment On February 06, 2009, at 7:41 PM, piinob wrote:

    Imagine a world where a AAA rating means someone actuyally took the time to see what the investment actually was rather than just stamping it and selling it. Imagine a world where the SEC actually investigates businesses, where banks don't get exempted from capital requirements for being big campaign contributors.

  • Report this Comment On February 06, 2009, at 8:46 PM, zookeeperfool wrote:

    It would be a wonderful thing to see a special 80% tax added to anyone receiving a bonus, in any form, from any company that received bailout money. At least most of the money would be recouped.

  • Report this Comment On February 06, 2009, at 10:37 PM, pedro777 wrote:

    This article (along with the comments) should be nailed to every door on Capitol Hill until all these bankers are behind bars for their crimes against society. These competent and smart people (the s0-called best and the brightest) all knew only too well exactly where their actions were leading to. Most knew that if they took their bonuses and fled before the inevitable economic crash they could "get away with their crimes". Disgraceful. May God have mercy on their souls (and help those innocent victims who are now or will become unemployed or who have lost their pensions because of the actions of a few criminals).

  • Report this Comment On February 06, 2009, at 11:35 PM, Oldmonkey wrote:

    Don't forget Chris Dodd, and Barney Frank also need to join the general population of the nearest Federal Penetentiary. Hope they get so many boyfriends their deviant pursuits become as painful as their rape of the American public has been to its citizens.

  • Report this Comment On February 07, 2009, at 12:03 AM, 1960scollegekid wrote:

    I usually don't get involved with these discussions, I feel it adds nothing to the solution of the problem under discussion; but, let me, in my small way, attempt to shine some light on all this... Back in the 1960's, the time of flower power and the beginning of the Vietnam "conflict", when service bashing was all the rage on college campus's...the biggest thing most of the professors were teaching those young impressionable minds was....

    "LOOK OUT FOR NUMBER ONE!"

    I don't doubt that most of the current white collar criminals were in the Ivy Covered Buildings about then, and heard that phrase at least 6 times a day, 5 days a week, 10 months a year, for at least 4 years, from the mouths of their professional educators. I know I did. That's all this crop of thieves did, they looked out for themselves and everyone else be damned. Thank you all you liberal college educators may your retirement funds and those endowments that have financed your colleges be stolen by one of your students......like they have taken my retirement income.

  • Report this Comment On February 07, 2009, at 12:28 AM, jbromet wrote:

    All the money being thrown around for the "stimulous package" is being done in a panic. The first round of bailouts didn't work; the next round won't either. The "leaders" and "experts" haven't learned from history nor have an understanding of human nature. This pathetic scene is like asking a bunch of diehard alcoholics to tend the bar. I guess there's no crime in being incompetent and/or stupid. But if there were true justice, these men and women (legislators and wall street criminals) would be in chains. I guess it's too much to expect them to commit suicide out of shame. Ya, like that's going to happen!

  • Report this Comment On February 07, 2009, at 3:20 AM, killben wrote:

    IT STINKS..

    WHAT KIND OF COMPENSATION POLICY IS THIS..

    WHAT KIND OF A***h*** YOU HAVE TO BE TO TAKE HOME SUCH PAY PACKETS WHEN THE COMPANY GOES BANKRUPT AND THOUSANDS LOSE THEIR JOBS

    WHAT DO YOU THINK IT SHOWS

  • Report this Comment On February 07, 2009, at 8:26 AM, michellelaidoff wrote:

    You need to write about why none of that bailout money has hit those people who all lost jobs in the last 30-60 days! Who cares about the bailouts if it isnt stopping manufacturing and companies who do under $2 billion in sales from going insolvent. Why? THE BANKS seem to be HOLDING ONTO THE NEW BAILOUT MONEY instead of giving loans to the companies on the brink of closing. They say, "Ah, we reject that loan request because its too risky!"

    This is an example of trickle effect of the banks not putting the money into use: Both my husband and I lost jobs because both the companies we work for went surpisingly insolvent within the last 30 days and own a home completely under water. The press wrote that they couldn't get funding from the banks. Qimonda and Circuit City.

  • Report this Comment On February 07, 2009, at 10:20 AM, Runningamok wrote:

    The Housing bubble that kicked all this off but was just a part of the great game of increasing credit. With intricate means that initial credit is then further expanded. As long as everyone seems to be benefiting or at least those who can shout loudest and have access to media then not too many questions are asked. Bubbles are created they dont just happen. And that minority who set them going get out in time. Was it any different this time? Of course not. It was small investors who took the hit in the Dot Com bubble when it burst. the manipulators got out in time. This time they have created a burst that will affect everybody. Anyone with a pension or savings or who works as well as those who have investments directly.

    But how do you pin the blame when its a SYSTEM. Bankers and financiers profit because they help run the system and thousands of fellow travellers in the press and media shout the triumph of an unregulated free market beggar-my-neighbour capitalism. Its all great until the instability becomes too great and it crashes. This is not an outburst of bankers crime within a fundamentally healthy system.... this is the

    inevitable result of a system that has become sick.

    Its of course deeply pleasing to imagine bankers in chains and even worse....paying for their greed but its like swatting mosquitos....the point in the long run is to drain the stagnant ponds where they breed.

    The real work is in thinking out how the system can be made healthy again and healthy not for a tiny minority but for a people as a whole.

  • Report this Comment On February 07, 2009, at 10:31 AM, generalrabble wrote:

    Hundreds? Only if you are just counting involved members of congress. It is impossible for me to believe that all of these recent events are just happening at the same point in time by coincidence. This is by design,wake up or lose all.

  • Report this Comment On February 07, 2009, at 11:52 AM, churchill112 wrote:

    The balladeer/songwriter Woody Guthrie said it best in his song about the 1930s robber Pretty Boy Floyd. "Some will rob you with a six gun and some with a fountain pen."

    A poor man robs you of $100 and goes to prison. A rich man and his gang of theives rob you of your home, retirement plan, and future; but they end up on a beach in the Bahamas and believe they deserve it as "pillars of capitalism".

    They justify outrageous salaries and bonuses with the need to attract and keep the "best and brightest", including themselves. These folks are nothing but criminals and latterday aristocrats. The French had it right during their Revolution in 1789: "Off with their heads!"

  • Report this Comment On February 07, 2009, at 1:56 PM, SteveinLasVegas wrote:

    Why are these clowns not in jail? Bernie Madoff under penthouse arrest for the biggest fraud in history is insane. We MUST demand laws that put this kind of criminal away for years and not at Club Fed.

    If a poor kid gets caught with a little pot...Jail time!. Steal billions...penthouse arrest and gourmet food.

    This is so wrong on so many levels. Those companies that took in billions and now refuse to account for it should have to return it. And NO MORE lavish parties with taxpayer funds either (AIG). And don't get me started on those golden parachutes!!! And the lame excuses for the immense paychecks for those who have done so much damage, not only to their company, but the country, and indeed the world. In fact NO MORE taxpayer funds without complete accountability and access to the books(before cooking) and maybe some humility for these execs.

  • Report this Comment On February 07, 2009, at 2:07 PM, SteveinLasVegas wrote:

    In addition to my other post, What was the SEC doing when they were told of Madoff's Ponzi scam, and how they ignored those alerting them. The whole top level must be FIRED for doing nothing to stop this scam...All I heard from them was their mumboJumbo and hearing Rep Gary Ackerman berating them was so refreshing to hear. He said what needed to be said. And he didn't let the lawyers try to excuse them .

    If the SEC says they are protecting investors, Be afraid..be very afraid.

  • Report this Comment On February 08, 2009, at 10:06 AM, StuDaBaka wrote:

    Lots of good and valid points made on both sides of this discussion.... Can't say mine are, but I will add them.

    It is a complex issue and their is not a 'silver bullet' that will solve it. We can be mad and generalize in our outrage, but painting on that outrage with broad brushes will not provide us with actionable and good root cause solutions. It will however raise the heat in the kitchen so that thoughtful analysis and fixes may get prioritized to the point where real and good reform can occur.

    There are many culpable parties, but the vast majority of the minions working in the financial sector are probably not. They may be friends, relatives, neighbors, fellow taxpayers, just earning their living, paying their taxes, raising their families, contributing to our communities. We need to differentiate and treat these folks as we would want to be treated.

    The leadership in the financial sector is very culpable. All have not participated in these systemic failings in the same way or degree, however, collectively they have failed to lead and failed to highlight the issues when they were probably in the best position of anyone to do so.

    The board of director function is culpable. Again, some more than others, but collectively they have failed in their mandate to oversee shareholder interests. My guess is that this is not unique to the financial sector and is reflective of a more systemic issue.

    Regulatory agencies are culpable. Billions of taxpayer money has flowed into these agencies and current events certainly show that whatever good was being done by them has been dwarfed by their failings in their fundemental mandates. More or less regulations is a bit of a mute point. Effective regulation, meaning effective enforcement of neeeded regulation, is what's required.

    Little is said about the rating agencies, but what of the leaders in those companies who assigned top shelf ratings to alt-a and subprime assets? What other 'fraudulent' ratings have they passed into the marketplace to apease the issuers that pay them for the ratings? No seperation of duty/alligence in a/the key risk assessment mechanism? And no one saw? And no one challenged?

    Government is culpable. Hard to net out all the ways, but generally speaking they behave and execute disfunctionaly. Blind to most everything except their parocial agendas. Deaf to the warnings brought before them. Dumb to standing up and effectively voicing the looming issues while their constituients were being allowed to live beyond their means and their lobbiest friends/colleagues where getting what they wanted.

    And yes, even stockholders and taxpayers have some culpability as we elect representatives and boards of directors. Trusting they will represent us well but really having done little/no due dilligence that would support such a trust.

    BTW - I don't think the underlying problems are unique to the financial industry..... Anybody eating peanut butter yet? Are the court doors revolving in your area as they are in mine? How are the roads and bridges in your area?

    Infrastructure is more than roads and bridges. We pay billions into government thinking many basic underpinnings are being taken care of. Maybe those responsible leaders we have placed our trust in should take a pay cut until they have proven they are delivering results?

    Seems like it's time for some proactive accountability vs one off reactive.

  • Report this Comment On February 08, 2009, at 1:15 PM, Kizzy2cents wrote:

    StuDaBaka makes much sense: it is time for proactive accountability. Start with ourselves & up the chain to those in Congress, they who make the laws & vote themselves all sorts of benefits.

    I have watched many cycles of boom & bust. During the boom years too many consider themselves smart as they see their paper profits grow. They sit back & preen confident this will go on forever because they are so intelligent, smart. Then the bust comes. The story now is different. It is the government, the bankers, anyone, everyone, whoever who are crooks & worse. No one looks into the mirror.

    This is a democracy. We are responsible. We 'trust' others then sit back & doze. Then we get surprised. Democracy takes work, constant work. It is during good times that we must be most vigilant, ask questions, & hold feet to the fire. This was not done for many administrations past.

    The sad thing is that the government is a reflection of us. Elected officials' real job (as they see it) is to be elected so they do & say whatever is required to get the votes. "When the public feeds from the public trough" democracy is in danger.

    We have been promised 'all things to all people at no expense to anyone.' As the government tries to bail out everyone, no one should feel any pain from their greedy mistakes. The "No Free Lunch" principle says someone will foot the bill & it looks like the taxpayer is it or the currency will devalue. I suspect both will happen.

    Democracy starts in the community. That is where to get started & to learn the system. How many people go to the casinos (a good place to watch greed in action) vs how many make informed choices at the polls? Is civics taught in your local schools? Shareholders need to unite to make their voices heard. Activists & gad flies have a place & perhaps we should listen (& evaluate) & act/vote wisely.

    We also vote with our money. It is my belief that all financial records of elected officials, corporations, unions, & everyone who accepts public money or favors should be open & online for examination. None of this 'off book' stuff. Relationships should be spelled out such as when a company does business with a corporation controlled by a director. While we are at it, the tax code must be simplified so it is understandable & applicable to everyone equally.

    As it is now there are just too many ways to hide, too many 'rights' & almost no 'duties.' Collectively we created this mess & collectively we can solve it & perhaps come out a better & stronger country.

  • Report this Comment On February 09, 2009, at 1:40 PM, MORK000 wrote:

    I think that the government should use part of my Social _Secutity check and invest it in these failing Stocks that are avaliblle!

  • Report this Comment On February 09, 2009, at 8:05 PM, deviltopay wrote:

    I could not help but note the time worn defense of the described thieves above with the statement that it is the government's fault and that if we just were more personably responsible with our investments, 'we' would somehow have been smart enough to see that these thieves for what they were and the subsequent looting of our treasuries and our economy. WE ARE THE GOVERNMENT!!! Remember??? By, For and Of the 'WE'!! The monied power elite will always create a climate of priveledge for themselves and design a structure of entitlement for themselves that saps the shareholders (WE) of our return and engorges their own off shore coffers while basking in the affirmation of the Excellence in Broadcasting (gag) network.

    The French had it right. Except, they should be walked down Wall Street in chains and a dunce cap. Then taken to the block where a lottery could be used to award the opportunity to pull the chain that will lop of their heads.

  • Report this Comment On February 10, 2009, at 12:26 PM, vireg wrote:

    Well you boys are missing a big point here,

    the reel culprits , who should be hung here are

    Andrew Cuomo, Frank Delano Raines, who pressured

    these same stupid bank people to make these obscene

    loans. Loans that Morphed the CRCA as a model

    to be used for the basis of Normal Business intercourse.

    This is just a pre-liminary as they Enronned the books

    claiming obscene bonuses for a co. that but for

    the re-financing by the govt should have gone under.

    Over 150 million (over 10 years) went into lobbying

    and demo campaigns. 50 million maybe into private

    pockets, no campaign to hang these guys , like

    the east germ stasi, no trials, but for the Spanish

    royalist and Chilean , democrats there is always

    and investigation. HO Ho Ho

    reggie 55

  • Report this Comment On February 12, 2009, at 1:39 AM, UseToBelieve wrote:

    Bravo Tom, I wish, as many here stated, you had gone just a little farther with more, if not most of the blame being laid at our lawmakers feet. I very rarely ever comment as I am about to here, I thank you for allowing me to throw in my 2 cents worth, I'm not very well educated and as such expect to be slammed for at least some of my thoughts. I am in full agreement with StuDaBaka, Kizzy2cents and a few others here, jail time is a great idea, as crazy as it seems though we are letting prisoners out as a result of our current crisis because we just can't afford to keep them, it couldn't have been planned this well by those in power! Yes, it's true that our lawmakers are elected by us, however they are not all to blame for our current situation, many spoke up about the problems they foresaw and voted against some of the legislation responsible for this crisis and, as has been noted here, were shouted down and at times, ridiculed for having a voice by those that still, today, speak with the loudest voices. Dodd, Frank, Pelosi and countless others that sit on the very commitees formed to act as regulators or watchdogs to PROTECT THE CITIZENS from these, and so many other abuses, they have failed Americans miserably and they should bear the brunt of where the blame lies, they LET it happen on their watch while attempting to place all the blame at the door of the White House. Dodd chairs the "Senate Banking Commitee", someone tell me why the hell he is so proud of the job, or better put, lack of it that he has done. I also wonder how it could it be that he, Dodd, while chairing this commitee somehow became so friendly with CountryWides Mozilo and then was allowed to accept what was at the time absurd mortgage perks as an "FOA" (friend of Angelo's)? Yet, the day after Obama's victory Dodd called a press conference to very arrogantly announce his staying on as chair of the same, while I and many others had been expecting the opposite! While Bush can't be given a free ride, those still in office that continue to criticize him the loudest all had a major part in what the taxpayers are now paying for in so many ways. I fear the economic crisis will continue until more of the people realize how guilty these lawmakers are, at the very least they have been derelict in their duties, then we can start with our represantatives, the "lawmakers". By start I mean by cleaning house, voting them out, elect new people with term limits, we should also demand and be given the right to make sure they have filed with the IRS and are current with any tax liabilities on a yearly basis, if not they must be given the same penalties as anyone else, somehow I can't see the IRS accepting my "apology" for cheating the country out of $140 thousand! This would also be the time to lower and then limit their pay and eliminate the ridiculous pension and benefits bestowed upon them with our tax dollars. One sure way of repairing Social Security as well as Medicare is by allowing this alone, or if eligible a pension from private industry to these same people that raped the fund, Social Security will be repaired, funded and more justly distributed pretty damn quickly, and I would bet the insane prescription copays and patient responsabilities would be more in line with reality with Medicare! These people are in positions of servitude, they were never meant to be career positions that offer more than what someone could or would earn in private industry, or to be thought of or act as if they are above the citizenry! As long as the abuses and corruption that take place within our lawmaking bodies continues it will never be stopped in any other industry, what's "good for the goose is good for the gander" mentality abounds all around us. As it has been said here, for the most part these individuals all came from the same universities, clubs, backgrounds, etc. and are lifetime members of the good old boys or girls club looking out for #1. While it's possible that I missed the uproar from the gang of 3 that I singled out here concerning the insane bonuses and golden parachutes given to the CEO's and such, I haven't missed the smokescreens thrown out concerning the importance to you and I with "STD's, Blanket Legalization of the illegal immigrants and as some are proclaiming, JOBS for these same people" while more and more currently employed hard working, tax paying American citizens are losing their jobs in record numbers daily, along with their homes. I have heard far to often that one has nothing to do with the other. Really? Not where I live, I have a hard working 27 year old son that has definitely been affected, so much so that he may have to move back in with us after being on his own for many years, we also have a 16 year old son, a junior in high school that can't find part time work and I'll tell you why, these same illegals are available 24/7, employers don't need to worry about after school or weekend schedules! He needs this job so he can further his education by attending college. Please, let your lawmakers know how you feel and don't be afraid to let them know if they aren't willing to listen or be concerned enough with what you have to say that your vote will not be theirs come election time.

  • Report this Comment On February 12, 2009, at 6:30 PM, ljubav59 wrote:

    I had an interesting conversation with my dermatologist last week. He said his sister in Hong Kong said that news of Madoff's scam had been in the news over there for the last ten years but no mention was made by the American media. Foreigners have lost all faith in the American banking system because criminals like these are going unpunished. These investors are pulling their money and will no longer invest in our banks because they have lost all respect for our system.

  • Report this Comment On February 13, 2009, at 1:45 PM, bbneedsshoes wrote:

    Just want to say that I agree with the comments and analysis of Tom Gardner, StuDaBaka, Kizzy2cents, TMFDiogenes, and UseToBelieve. Very insightful. If any of you guys run for office, you have my vote!! I just wish the people running our government had as much integrity as some past presidents such as Harry Truman and Gerald Ford.

  • Report this Comment On February 15, 2009, at 7:35 AM, jmac70508 wrote:

    When you sell a product that is backed by assests rated bbb or -bbb as investment grade AAA in such a way that even a past Treasury Secretary cannot figure out what they are is criminal. Wall Street wanted any mortage to package and sell as a CDO they didn't care where it came from until the people that where talked into these unaffordable mortages could no longer make the payments. I understand that many should never have signed but did anyway. But the problem lies in the fact that 75% relied on the person writing the mortage telling them that they could afford it. The mortage lenders and the banks were the Business educated taking advantage of the uneducated. Wall street is saying they should not have signed I agree with that point but if they were honest about what they were selling and explianed the true risks people would not have signed. Wall Street wanted the money and did not care of the consequences. I rent my house so my views are those of an outsider looking only at cause and effect. I believe that the only way out of this mess is for the FED and Treasury to follow the same plan that was used on the Savings and Loans in late 80's. Close down the banks that are in effect insolvent without the taxpayer's money clean up the books and sell them back to the private sector.

  • Report this Comment On February 17, 2009, at 2:33 PM, KLion wrote:

    Too few of the above comments, and none of the aired "news" and "expert" opinions on the economic/financial crises mention the idea that the value of money is somewhere based on some kind of production; and too many people equate the words "value" and "price". Perhaps that's part of how we got where we are, and why it's not going away so quickly. If we don't even understand how economies and finances work and interact, we can't know what's wrong. If we don't know what's wrong with something, any fix will be by accident. For something as complex as our economy, our financial system, and how they interact, that's a bit much to expect.

    The problems are many and complex; so I will stick to the subject of the article: jail. We have plenty of laws against stealing and otherwise acting in a position of a conflict of interest, the problem is that our houses of representatives and our system of justice have forgotten that the purpose of any law is to allow uniform implementation of justice in a society; so instead of a few laws that describe the justice they are supposed to help implement, our lawmakers are trying to describe every little detail of every little thing that they consider unjust, and our system of justice considers its purpose to be enforcement of the letter of the law, rather than the implementation of justice. There are problems with that:

    1. You can have very many actions that in themselves are not unjust, but that together lead to injustice. The number of laws required to allow prosecuting every unjust combination of many possible actions cannot be managed in any practical way. Simple example; given 30 different just actions, those actions may be combined in 30! (factorial) ways. That's about 265 followed by 30 zeros. Assuming only one in a trillion (million million) of those combinations would result in an injustice, the number of laws required to allow prosecuting those injustices would be about 265 followed by 18 zeros (over 44 billion for every human being on earth). If each of those laws were to occupy one 1 piece of 0.003 inch thick legal size paper (if you've read laws, you'll know this is an underestimate), the volume of paper would be sufficient to cover the entire surface of the united states with solid paper about 500 feet deep. How do you manage and enforce them? Where do you get the trees?

    2. The more laws there are, and the more ambiguous those laws are, the more lawyers and judges are needed, and the more difficult it becomes to implement justice. That means anyone whose normal job is within the system of justice, and who serves as an elected lawmaker, clearly benefits him-/herself in his/her future. This constitutes a clear conflict of interest for that person as an elected lawmaker AND in his/her position in the system of justice. Conflict of interest (particularly in public service) is one of the things that the system of justice is supposed to be able to prosecute. How does a system prevent a problem it's part of?

    3. Laws are described in words, and words alone do not have meaning; words are associated with meaning by the people using them, based on many factors. As a result one word or one sentence may mean completely different things to different people. Language changes as new things and concepts are created, as old ones are forgotten, and as human ignorance and thoughtlessness result in unintentional and intentional misuse or abuse of language. This means that the assumption that once a law is written it will not change, is wrong. A well-written law may be better than a poorly written one, but though a word may be written in stone, meaning is not. Historically, lawmakers and lawyers are very adept at using words to confuse, disguise and twist meaning. This would qualify them as consultants when trying to determine how a proposed law might be misinterpreted or misused, if doing so would not also be a conflict of interest to them.

    4. Most of the current economic and financial problems are at least partly the result of abuse of entrusted power over others. That means someone who was given power over others to act in their interest, used that power to act contrary to their interest. That is conflict of interest.

    5. With the huge number of laws already in existence, it is likely that there are conflicts and duplications, as well as laws that in no way serve the purpose of implementing justice. If any of these conditions exist, the legal system is certainly broken, and the system of justice is probably compromised.

    So, if conflict of interest, direct or expressed as abuse of power is illegal, there should be a lot of people being prosecuted. If they are not, either our representatives have not been doing their jobs, or perhaps we are also confusing the expressions "legal system" and "system of justice". The problem addressed by the article is caused by a broken system of justice

    As a first step, a better way actually already exists. For example; a building code is a set of rules with the end purpose of assuring that buildings are safe and in other ways perform satisfactorily. They contain conditionally enforceable rules, but for each that is not absolutely unambiguous there is a "commentary" with examples and clarifications to make sure that the INTENT of that rule is enforced, not necessarily the "letter" of that rule. In addition, building code rules are reviewed and revised on a regular basis, to make sure they still apply and still properly describe their intent as technology, language and people change.

    Perhaps laws need to be written and maintained in the same way. If our lawmakers were REQUIRED to review the laws on the books perhaps they would have a little less time to bog the country down with new laws that further hinder justice (and that they don’t have time to read well enough to know what “pork” their fellow lawmakers are sneaking past them).

  • Report this Comment On March 06, 2009, at 1:31 AM, truthlover wrote:

    Take the time to read the "intelligence" and financial

    newsletters of British Christopher Story, who has

    been an investigative reporter since the 1960's and

    who has obtained a large global network of sources,

    connections, and following (apparently, including

    those "in the know' on Capitol Hill). According to

    Mr. Story's website (About the Author link) he was

    an occasional adviser to the former Prime Minister

    Margaret Thatcher and has been asked to testify in

    Congressional hearings on several occasions in

    regard to international affairs. The web address to

    Christopher Story's website is below, and presents

    a different account of what we've been told has been,

    and is, taking place, that is extremely disheartening,

    yet important to know.

    http://www.worldreports.org/news

    Along similar lines, for those of you don't know this

    -- shortly before 9-11, it was discovered in an audit

    of the military sector of the U.S. Treasury that

    $2.3 trillion had vanished - which Donald Rumsfeld

    admitted to, on questioning by news reporters, the

    day before 9-11. Then, the next morning, the events

    of 9-11 took place, and the section of the Pentagon

    that was hit, was the section where the audit was

    taking place where the disappearance of the

    $2.3 trillion was discovered. This $2.3 trillion has

    not been recovered and it's theft has been swept

    under the rug. In addition - it seems evident that

    only people who held the most trusted positions in

    the upper echelons of our government would have

    been able to access and steal this $2.3 trillion.

    Below is a web address to one of the places where

    one can watch the television news report in which

    Donald Rumsfeld admitted to this (there are many)

    and another website with an in-depth article about

    this, as well.

    http://www.youtube.com/watch?v=3kpWqdPMjmo

    http://www.oilempire.us/trillions.html

    Given that government corruption was a huge factor

    that motivated the American people to turn-out to

    vote for Obama in such unprecendented numbers

    - motivated millions of Americans to travel to

    Washington, in support of President Obama, at his

    inauguration - it seems to me that if a grass roots

    movement were to be organized for millions of

    Americans go back to Washington -- or elsewhere

    in the U.S. -- in a peaceful, but determined, demonstration on a specific week or week-end --

    making it known to those in the Senate and the

    House of Representatives, that the American

    people expect them to exercise, and diligently

    follow-through on, their Constitional duty and powers

    to see to it that investigations are made, followed by

    arrests, and seizure of personal and corporate assets

    to be liquidated and returned to the U.S. Treasury

    upon conviction of all people who have held, or

    currently hold, governmental positions in which

    "links" of a valid basis has existed, or does exist,

    that they participated in/committed felonious acts

    of theft, fraud, and/or treason against the American

    people (and without immunity).

    This should get the attention of our elected

    representatives, in all the states of the U.S. and

    motivate them to do what they should have been

    doing all along.

    Anyone have any ideas about how to organize a

    demonstration of this size and nature ?

  • Report this Comment On April 24, 2009, at 5:58 PM, MyDonkey wrote:

    Sour grapes from a bunch of hypocrites. You're all whiners, except BillinBoca who's got it made.

    If you had bought $1000 of Bre-X when it was a penny stock, and sold your thousand-bagger in March 1997, would you have returned your million dollar profit after the scam blew up? Didn't think so.

    If you had made a million dollars from Bernie Madoff, would you now return that money willingly? Didn't think so.

    http://finance.yahoo.com/news/Madoff-investors-ordered-to-ap...

    If you had shorted the market in September 2008 and made a cool million over the following 6 months, would you now be demanding jail time for all the "criminals"? Didn't think so.

    You're just jealous of the brilliant scheme being played to perfection by the banking oligarchy and their political puppets. And you're kicking yourself for being blindsided by the meltdown instead of heeding the warnings of Peter Schiff in 2006-2007.

    http://www.youtube.com/watch?v=2I0QN-FYkpw

    Cry me a river, loser.

  • Report this Comment On November 19, 2010, at 5:37 PM, sails2 wrote:

    OK -- all you folks who blame this whole thing on "poor people who should not have bought houses," well, consider this: The top 1% is walking away from $1 Mil plus mortgages. Commercial real estate borrowers are doing the same thing. Is it a good business decision for a rich person to walk away from his or her home or second home or is it a moral hazard? How about the commercial real estate sector. How about the success of lenders like Shore Bank who KEEP their loans and screen their largely working class borrowers. Must be socialists.

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