Wall Street on Pace to Hand Out Record $140B in Employee Bonuses As Foreclosures Hit All-Time High
This is a must-read/see for every American. The Banksters continue their plundering in full daylight. How come William Black isn’t on every talk show in the country? Oh, yeah, that’s right. If Obama meant half the things he says, Black would be Secretary of the Treasury, not foxes from Goldman Sachs lording over the henhouse of the public treasury like people like Timothy Geithner.
The Dow Jones Industrial Average has topped 10,000 for the first time in a year, as JPMorgan Chase reported massive profits in the third quarter. Meanwhile, the Wall Street Journal is reporting that major US banks and securities firms are on pace to pay their employees about $140 billion this year˜a record high. But on Main Street, foreclosures are also at record levels, and the official unemployment rate is expected to top ten percent. We speak to former bank regulator William Black, author of The Best Way to Rob a Bank Is to Own One.
One of the many examples of Bill Black getting to the point…
Well, I mean, Summers, for example—you talked about Geithner’s aides and how much money they had made, and, of course, it’s absurdly large, and they’re making it typically for not doing much of anything. But they’re taking their cue from Summers, who got $5 million, roughly, for working one day a week in areas he had no expertise. So, you know, once you leave the federal service, then these interests that you were very helpful to find a way to make you spectacularly rich, and they know that that’s what’s coming in their future. That’s part of the problem.
But the bigger part of the problem, in many ways, is that they have such an ideology about the market and its ability to deal with all problems that has no basis in reality, has been exposed in this crisis as completely fictional, and yet they can’t give it up. I mean, think of yourself as one of these professors who’s been trained in the Milton Friedmanish views, and you’re in your fifties, and you’ve been saying—you know, everything you’ve said in your career is wrong. Everything you’ve learned in your career is wrong. All of your areas of expertise are wrong. Are you going to admit that? “Hi, I’ve been misleading you, and I’m sorry I caused this disaster. And by the way, I have no meaningful skills or experience.”
Read The Transcript/Watch The Video from this insightful interview
And for those of you who missed it the first time around, here is another excellent interview with Black by Bill Moyers.
on October 20th, 2009 at 12:07 pm
As an entrepreneur, I am mortified by the fact that the word “profit” or “record profits” has a worse connotation than words that used to cause mothers to put soap in their child’s mouths. The reason that JP Morgan is profitable is because a)they have cut personnel and become more streamlined, more efficient and b)because they are not making as many “bad” loans. How is this a bad thing? In business school, we are taught that Surviving is good, but Thriving is great (it allows for longevity and wouldn’t a little job security be good right now?)
This economic climate is tough, but you can’t expect businesses to give up. The reason they are making gains is because they have made good choices. Maybe the rest of us should look at what they have done and apply it to our own finances instead of being mad because they did something right.
The other good news is, it looks as if many of these firms have been able to make plenty of money to pay back the TARP funds they were originally given. Let’s see if the government actually lets them give it back.
on October 22nd, 2009 at 4:04 pm
As a long-time business owner and proprietor myself, I too lament the fact that “profit” has become so besmirched by the conditions of our time. I would like myself to be making “record profits” (as opposed to just profits off of a record), but at what cost, and to whose expense? The issue here isn’t profit, but *how* those profits are derived, which in the cases of these financial institutions, is more in line with how a cartel or mafia does business than anything resembling the ideal, theoretical world of Adam Smith-style capitalism that Rhonda’s note seems to imply continues to exist, against all evidence to the contrary.
As there are so many aspects to her comments here which would be grounds for more in depth discussion and rebuttal, I can only in scope of the limited time available re-submit as evidence of indictment of the practices of these institutions the perspectives of William Black, for which links are provided in the article.
Also, his book “The Best Way To Rob A Bank Is To Own One” is reading I would like to recommend to Rhonda, along with Kevin Phillips’ great book “Wealth and Democracy.” This book goes into thorough research and historical detail about how the “record profits” being racked up today by these institutions are not only wildly out of proportion to the income derived by the rest of society. Such a condition is not only dangerous to the future ability to operate anything resembling a democratic society which provides the necessary social mobility and egalitarian opportunity for it to sustain itself, but history shows us that those conditions, particularly with the financial-ization of an economy which ours has become, is a thoroughly fatal condition for the future sustenance of that society. We are no longer a democratic society which uses capitalist economics as a tool for enhancing wealth and opportunity, but have rather devolved into a market society, where all interactions are commodified and everything is for sale, including the rules. This is corporate crony capitialism writ large.
When the dichotomy between those who have wealth and those who don’t becomes as extreme as ours has in the U.S. (the greatest disparity in our history), that bodes very ill for the future prognosis for the continued stability of that society. The point being made by Black and others, which Rhonda’s note is not addressing, is that this condition is not occurring because of the pluck and entrepreneurial initiative of a few businessmen, but rather from the systematic manipulation of the rules of the market by the few at the expense of the many. The plundering of public resources for private profit. The process of socializing the costs and privatizing the gains. It is a condition for which the original American Revolutionaries fought against, the idea that government was a tool to confer privilege upon insiders.
As for the Banksters, here is a website that came my way recently, which may be of some interest…
http://www.stopbankgreed.org/get-the-facts/