cognitorex

Circa 1986 I sat high up over the New York City financial area with a prominent bank's Executive VP and Director.
He said, "Where do you think we should be looking for future profits, we'd like to have of our equity 'at play.'
I was flattered that he should court my opinion. I also remember thinking, "Half your equity at play, what are you, nuts?"
The bank is no more in existence.
The thinking that taking increasing risk in order to increase bonuses brought the system down. Paying people to book trades and make risky loans without waiting for repayment or profits to be realized created a bonus atmosphere versus a profit atmosphere.
Greenspan absolutely had to fully know of these issues.
For personal or political reasons he let the GOP/big bank's horsepucky 'no regulation' mantra rule global financial markets to the gross neglect of the world's individual depositors and pension holders, both average folks and the very wealthy.
His legacy from his time at the helm is cowardice and abject failure. I hope he can feel shame; lots of it, unregulated.

Labels: Bernanke, bonus excess, ceo excess, Greenspan, Wall Street

• Like the mob, reputable and not so reputable financial enterprises 'whet their beaks' on all commercial flows of capital.

  (Wall Street firms are expected to pay out a record $23.9 billion in bonuses this year. 12/20/06 USA Today)

  (Meanwhile the financial types have stripped a tenth of a point here and a half a point there from these capital flows, enriching themselves until the speculative 'excessive risk' schemes meet their inevitable and repetitive denouement. (from: Cognitorex , "John Doe Pays" ))

  One manifestly equitable countervailing economic policy would be to place a one one hundreth of one percent Value Added Tax on all capital flows.

  The financial mafia ('Them') enrich themselves by taking a bite out of America's capital flows at every instance while 'Us', the creator's of this wealth, need Moms and Dads working multiple jobs to eat and provide the capital for this system.

  In a bad year, when capital and equity shrink due to the excesses of the financial mob's schemes, the little guy has to pony up to replace the capital. In this manner, John and Jane Doe repeatedly have to pay an effective greed tax and pay more for their car loans, their mortgages and their credit cards until the cosa nostra bankers replace their depleted capital.

  As our capital washes around the globe for economic enterprises, both good and bad, and for hedging and for asset speculation, there is no reason that the 99.9% of the population that suffers the cost of the downturns couldn't charge a way tiny `rent' for this resource.

  Direct these tax flows to Social Security and Medicaid and they would thus be amply funded and capitalism would manifestly not miss a heart beat.

Labels: Soprano Tax Plan, subprime, VAT Tax on Capital flows, Wall Street