If (Or what the Bear Stearns deal reveals about our nation)
If a middle-class person files for bankruptcy, his credit is wrecked ... no credit cards, living paycheck to paycheck.
If a small company runs out of work, they close their doors. They sell off their equipment at pennies on the dollar.
If a large institutional bank makes risky investments, and the market collapses, that company is sold at pennies on the dollar to the next biggest bank. The economic food chain continues.
The whispers on Wall Street prior to the Bear Stearns collapse ... J.P. Morgan buying their competitor at an extreme discount, including a Manhattan building worth over a billion dollars ... executives for Bear Stearns selling their shares a couple of months before the ultimate collapse, the iceberg clearly in site as the U.S.S. Titanic rode full steam ahead, the hopes and dreams of the American homeowner riding in the hull.
The geniuses on Wall Street have played the system like a fiddle. Their MBA served them well. The ethics training they received at school was nodded and winked at.
The business schools will take the lessons learned and indoctrinate future MBAs with the political wisdom imparted by Henry Paulson and J.P. Morgan ... they will learn that the former head of Goldman Sachs can drive the Treasury to give taxpayer dollars to risk-taking banks in exchange for worthless paper ... they will learn that the link between government and Wall Street will protect them when they make mistakes ... "So, go ahead," the professor will say. "Take a risk. You won't pay if you fail."
Such a corrupt system, where ethics is replaced by a mix of laziness and fortune at all costs, leaves our nation open to outside influence.
If a small company runs out of work, they close their doors. They sell off their equipment at pennies on the dollar.
If a large institutional bank makes risky investments, and the market collapses, that company is sold at pennies on the dollar to the next biggest bank. The economic food chain continues.
The whispers on Wall Street prior to the Bear Stearns collapse ... J.P. Morgan buying their competitor at an extreme discount, including a Manhattan building worth over a billion dollars ... executives for Bear Stearns selling their shares a couple of months before the ultimate collapse, the iceberg clearly in site as the U.S.S. Titanic rode full steam ahead, the hopes and dreams of the American homeowner riding in the hull.
The geniuses on Wall Street have played the system like a fiddle. Their MBA served them well. The ethics training they received at school was nodded and winked at.
The business schools will take the lessons learned and indoctrinate future MBAs with the political wisdom imparted by Henry Paulson and J.P. Morgan ... they will learn that the former head of Goldman Sachs can drive the Treasury to give taxpayer dollars to risk-taking banks in exchange for worthless paper ... they will learn that the link between government and Wall Street will protect them when they make mistakes ... "So, go ahead," the professor will say. "Take a risk. You won't pay if you fail."
Such a corrupt system, where ethics is replaced by a mix of laziness and fortune at all costs, leaves our nation open to outside influence.
Labels: bankruptcy, banks, Bear Stearns, corrupt, ethics, food chain, investments, laziness, MBA, pennies, risky, Titanic
posted by Skew | Monday, March 24, 2008
5 Comments:
...like the future masters of the world: China.
What type of backdoor meetings went on over at Bear Sterns?
Both Chairman Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) cosigned a letter to to executives at JP Morgan, Bear Stearns and the Federal Reserve asking for all the documents, pricing details and other data that led to the Fed's $30 billion loan, which allowed JP Morgan to buy out Bear Stearns at a bargain basement price.
While the Finance Committee heads aren't implying there was any wrongdoing, they are intent on shining some light on the dramatic Fed maneuver, which Baucus called a "taxpayer backed sale."
"Americans are being asked to back a brand-new kind of transaction, to the tune of tens of billions of dollars," Baucus said. "With jurisdiction over federal debt, it’s the Finance Committee’s responsibility to pin down just how the government decided to front $30 billion in taxpayer dollars for the Bear Stearns deal."
The senators have asked for the pricing details, the names of the executives involved in the transaction, and more specifics about exactly what assets the Fed agreed to back with its $30 billion loan. The committee appears to be skeptical of the quick repricing of the Bear Stearns deal, which jumped from $236 million to more than $2 billion in a matter of days.
The committee has set a March 28 deadline for the two banks, plus the Fed, to provide all the documents and financial details behind the transaction, but no hearings have yet been set on the issue.
"Congress has a responsibility to look at whether the taxpayers will lose money here, what kind of precedent this sets for federal involvement when other firms overextend themselves, how this will affect the marketplace," Grassley said.
Grassley said it's also important to know "whether top executives will come out better than the rank-and-file workers who weren’t in the room negotiating the deal.”
If the powers that be were really serious about improving the overall american economy in a fundamental way, why not let the public in on this instead of giving a preffered stock sweetheart deal to another consortium of millionaires ?
since the shares are being sold so cheap, why not let everybody in on it ?
At $2.50 a share, just about everybody can get some.
Instead of federal regulators keeping everyday people out, they should be required to do the opposite.
That way we could all own a little piece.
Let all the poor and homeless people in on this, and let them be the stockholders for a change
this way needy members of the general public might finally get a piece of the pie.
(like that jeffersons song goes)
if it were done this way who knows, the people who need it might actually get a little for a change.
and maybe then the situation would reverse, where the former millionares would have to push a mop for minimum wage somewhere because they blew it and made bad discisions that caused a company to go under, and those who formerly had nothing can be the ones attending the stockholders meetings for a while, and collect some profit.
after all, I dont think the uneducated working class people like myself would do a worse job than these ceo-scoundrels that lose millions of dollars all the time.
why not ?
shouldnt every dog have his day ?
Is this kind of talk really crazy?
Or is it justice?
Orwell in 1984 said there will always be 3 classes of people: the prols (Lower class, relatively uneducated), the Outer Party (Middle Class), and Inner Party (Upper Class ruling elite).
Throughout history, the Middle Class wants to become the Upper Class, while the prols want everyone to be equal. The Upper Class wants to remain in power by any means necessary. When the Middle Class overthrows the Upper Class, they become just as elitist.
In 1984, Winston Smith knew that the proles were the key to revolution, since they outnumber both classes. But it was a displaced hope because the proles have no interest in running a government, or any desire for the responsibility.
As long as you can remember this lesson, you'll know why social justice does not apply when it comes to Bear Stearns.
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