Tuesday, December 8, 2009

Can't Tell Me Nothing- 12/8/09

My intention of this post is not to criticize the system but to rather to question it.

"I had a dream I could buy my way to heaven, when I awoke I spent it on a necklace...I feel the pressure I'm under more scrutiny and what I do, act more stupidly."

--Kanye West, Graduation

Today, Bankers in England must have their bonuses taxed. Bank of Ameria is exiting the TARP program so they can hire a chief executive who will be well paid. Citigroup desperately wants to exit the Tarp but has been denied thus far. Neil Kashkarian takes a new job at PIMCO to build up the Allianz-owned firm's equity business.

These are all headlines from around the today's media. What is abnormal about the above? In short, nothing. Wall Street has not changed since the near financial Armageddon. Why should it? The systems in place were created by the current generation of bankers, traders, analysts, and fund managers. How can the the general public expect change when the current generation live, breath, and sleep meritocracy. The system has been constructed to "reward those who show talent and competence as demonstrated by past actions or by competition." Why is this wrong? Its not.

However, politicians are scrambling to point the finger at firms that bathed in "excessive risk taking/leverage." What good does this do? I will be the first to admit Wall Street has much to be thankful for as we round out the Holiday season. Yet, If there was no Citigroup, AIG, Goldman Sachs, or Bailout inc. bonuses, the same politicians who persistently criticize the system would not be elected/re-elected/appointed.

Washington and Politicians in general need to move away from their "old ways of doing business" if they truly want things to change. I believe in Capitalism. Though, I also believe in checks and balances. Maybe Finane got out of hand for a time, but that still does not justify the finger pointing blame game. The crisis was a perfect storm of poor regulation/risk taking/monetary policy/oversight/ratings/etc... Wall Street will not change unless Washington changes first.

Patrick M. Ambrus
Managing Partner
Analyze Capital LLC

No comments:

Post a Comment

This Blog has been developed by Analyze Capital LLC, and as an independent organization we provide “AS IS” information without warranty. The ideas and opinions expressed by the contributers of this blog are personal and do not represent the actions or policies of Analyze Capital LLC. The contents of this blog do not intend to assert recommendations or to offer advice of any kind. We are not responsible the consequences, be they gains or losses, that may result from using any of the information from this blog.