Simon Jenkins in The Times has a good roundup of where things stand with the collapses on Wall Street and the attempts to fix it.
At issue though, the big problem that’s stalling a Government desperate to initiate the bailout, is a fundamental problem gripping any neutral observer.
These bankers have, for 60 years, siphoned off a chunk of all the world’s money for their personal pleasure. They told us it was justified because they understood the ever more complex instruments they’d created to ever further leverage the same pile of money.
They hired all the brightest brains coming out of all the world’s universities, and then put them to work, in large part, doing things you could train my kelpie George to do. Light goes red, hit the sell button.
We could, perhaps have asked if all those bright young things couldn’t be doing more for the world out doing something productive and left the trained kelpies to manage the markets. The wisdom of hindsight again.
But as long as the money kept flowing, as long as the markets performed their intended tasks of insuring liquidity and providing investment capital for new ventures, the rest of us didn’t worry too much about the insane schemes used to play with our money in, at the end of the day, zero sum games.
And now, having taken so much of our money these bankers are turning around red-faced. Admitting that they had failed to account for the basic fundamentals of their businesses. Letting slip that, after all they hadn’t understood what they hell they were doing with derivatives piled on derivatives.
And the solution now is taxpayer funded subsidies? Because no investor wants to put their own money into these schemes any more?
The people catching the bus to work are going to have to pay up to keep the obscene old men in their Maybachs?
That dog won’t hunt. Revolutions have kicked off over less.
In the Washington Post Charles Krauthammer was joking when he made this suggestion, but it wasn’t that much of a joke:
“Capping executive pay is piffle. What we need are a few exemplary hangings. Public hangings. On television. Pick a few failed investment firms, lead their CEOs in chains through the canyons of Manhattan and give the mob satisfaction. Better still, precede the auto-da-fe — fire is highly telegenic — with 24-hour reality-TV coverage of their recantations, lamentations and final visits with the soon-to-be widowed. The ratings would dwarf “American Idol,” and the ad revenue alone would make the perfect down payment on the $700 billion.
Interesting times.