Robert Benmosche, CEO of AIG at an insurance industry conference in Washington DC last week:
All of the states where we’re a leader, where we’re the No. 1 insurer, are red states. All of the states where we’re at the bottom are blue states. Part of what we found out is that our model is about culture, and it’s about the attitude in the public. And what we find is where there’s more of a tendency for people to be more liberal, more that the government is responsible for what happens to me.
Culture, hmmm? He must mean something like this:
Just read a large piece on strategic defaults in the Huffington Post. That is to say, walking away from bad mortgages you can’t pay off, especially when the value of the loan is more than the value of the house. Most of them felt horrible for walking away.
The bottom line is this: there is one morality for masters and one for slaves. Your lords and masters, who have made you or are making you into a wage or debt slave, have one morality and you have another. The masters don’t just walk away from bad debts, they force other people to pay the master’s debts off or they change the laws so that the masters debts don’t count.
It is, for them, a cold clear business decision. They do what is best for them, no matter what the cost to anyone else. When dealing with the master class, you should operate in the same cold clear fashion: you do what’s best for you and if it hurts a corporation or a rich person, that’s their look out.
Trust me, that’s the way they do it. The cost of the financial crisis is a millions of destroyed lives, including many many deaths. You don’t see any of the people who caused it having moral crises over the fact that they caused a depression, do you?
No, indeed you do not. Instead, you see AIG "appealing to private investors to replace government capital that accounts for 92 percent of the company’s stock". I guess Bob forgot about the $180+ billion bailout his company received from the US Treasury. Or maybe he thinks that anything that happened before his tenure--he joined the company in 2009--didn't really happen at all. How convenient , not to mention savvy. Surely, he deserves a bigger bonus.
Meanwhile, around the corner, Larry Meyers and Gerard Novello, who work for an Italian securities firm, ducked into a Mexican cantina for a drink. It was Mr. Meyers’s 43rd birthday, and he ordered the tequila.
“On Main Street, ‘bonus’ sounds like a gift,” he said. “But it’s part of the compensation structure of Wall Street. Say I’m a banker and I created $30 million. I should get a part of that.”
Er, no. Clue stick, Larry:
You didn't "create" a fucking thing. People who have real jobs, people who make stuff -- whether it's cars, or steel, or computer code, or pizzas, or or even blogs -- they are the ones who create. You just pushed some pieces of paper around and took a cut. You're just a parasite, and about as creative as a mosquito.*
NOTE * To be fair, mosquitos do create disease by injecting micro-organisms into the bloodstream of their hosts.
NOTE The title is, of course, a take-off on a long running series by Lord Eschaton.
How could I have missed this one? Times:
“Without a doubt, $18 billion is a lot of money, but it’s a drop in the bucket on Wall Street,” said Gustavo Dolfino, president of the WhiteRock Group, a headhunter for the banks. “These bonuses are down, and the salaries are not enough for these people. They can’t live on $150 to $180,000, so they haven’t saved any money. They put it on credit lines and at bonus time, they thought they’d pay it off.”
May I suggest that they learn?
'Cause you can buy an awful lot of ramen noodles for $180,000....
Pravda runs a video series called "On Leadership." Here's a hilarious video from Hank Paulson. On compensation practices:
"[PAULSON] You have a culture which is all about paying individuals a percentage of the profits they make trading. That's a recipe for disaster. ... They take chances and if-- if-- if they lose, they're losing someone else's money."
No shit, Sherlock.
OK, we're not going to pay these guys money to take chances anymore? But we were paying them the big bucks exactly because they were supposed to be able to assess risks. And now that theory's down the tubes.
So, why not turn the banks into regulated public utilities?
Oh, and the "excesses" were due to "imbalances in the global economy." Uh huh.
"This is an issue of 'we' and 'they,'" Mr. Levitt said. "Compensation is a part of it, but a symbolic part of it. We are a centrist nation ... We're now shifting to the left pretty far in terms of business-bashing and it has reached extremes of incivility that are intolerable."
Got your 401(k), Arthur? How's your house? Got a job? Health care when you need it? Good. I'm happy for you.
Now, you and your golfing buddies lost millions of Americans all of those things when you looted our economy.
Come back and talk to me about being civil when you've joined them.
UPDATE And, Art -- if I may call you Art -- you might want to reflect on these words from Paul Volcker:
Paul Volcker, former Federal Reserve chairman, spoke for many of the attendees when he acknowledged that "we're in a government-dependent financial system; I never thought I'd see the day."
That means that I own you, not the other way round. Try to make nice, wouldja?
Lots of candidates here, but I think this is the best:
Richard Davis, CEO of U.S. Bancorp (USB), said a proposal to tax bonuses paid to employees of companies that accept government aid wasn't discussed at the meeting, despite widespread public outrage - and administration rhetoric - over the bonuses doled out to executives at American International Group Inc. (AIG).
"We understand there have been some optics that have been very negative. We apologize for that because it's not something that this industry supports or wants," Davis said.
He's apologizing for "bad optics"?!?!??!?!??! To whom?
[Reach me that pitchfork, wouldja hon?]
And if "bad optics" isn't a Versaillogism, I don't know what is...
[Larry] Summers, the former Treasury secretary and Harvard president who is now the chief economic adviser to President Obama, earned nearly $5.2 million in just the last of his two years at one of the world’s largest funds, according to financial records released Friday by the White House.
Impressive as that might sound, it is all the more considering that Mr. Summers worked there just one day a week.
I guess this proves that men really are better at math?
Citigroup Inc.'s new board chairman, Richard Parsons, said financial institutions are being targeted for creating the nation's financial crisis, but they aren't the only ones responsible.
"Everybody participated in pumping up this balloon. Now the balloon has deflated," he said Monday. "Everybody, in reality, has some part of the blame. But it's much more in the culture to find a villain and vilify the villain."
OK, everybody did it. So why are you guys still paid the big bucks, and we lose our jobs, our houses, our 401(k)s, and our health care?
Reminds me very much of the famous quote from Anatole France:
La majestueuse égalité des lois, qui interdit au riche comme au pauvre de coucher sous les ponts, de mendier dans les rues et de voler du pain.
The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread.
And, oh yeah. What did you do with our trillions?
Parsons, who served as an economic adviser on Obama's transition team
The turning point for Stephan Jung came in February, around the time bonus checks were slashed. [Quelle surprise!] A veteran of UBS, one of many banks tarnished by the financial crisis, Mr. Jung realized that the old Wall Street would not be bouncing back any time soon. It was time to head for the new.
“After 10 years, I did not see a future for myself,” said Mr. Jung, 42, who quit to parlay his sales expertise into a career at Aladdin Capital, a small but rising investment firm run by others who had also left some of the most venerable names in finance.
I can identify. One question, Stephan:
Have you considered fucking yourself?
So very many to choose from in this terrific New York article, but this anonymous bankster is my very favorite:
“You can’t live in New York and have kids and send them to school on $75,000,” he continues. “And you have the Obama administration suggesting that. That was a very populist thing that Obama said. He’s being disingenuous. He knows that you can’t live in New York on $75,000.”
NOTE Via TalkLeft.
A leading Senate Republican warned the Obama administration against removing chief executive officers at banks that received U.S. assistance, saying “the great fear” would be government management of companies.
“If you think that Washington can run car companies and banks and so on, well, then you’ve not been paying attention to how we’ve been doing back here,” Senator Jon Kyl said of the Treasury’s threat of management changes at banks getting “exceptional” aid.
Like Big Money and Big Auto have done such a good job!
What's wrong with these people?
NOTE It's not as if the Finance Wing of the FKD isn't acting the same way. But they're so much more subtle in the way that they say it!
Today, all the banksters are Banksters for a Day! Bloomberg:
The CEOs of the top 20 financial companies in the ranking all chalked up pay packages in excess of $10 million, in a year when the performance of their commercial and investment banks and insurance companies was uniformly poor.
“The disparity between pay and company performance is as large as I’ve seen in my 33 years in this business,” says Frank Glassner, managing partner of Veritas Executive Compensation Consultants LLC.
The highest-paid U.S.-based CEO was Bruce Wasserstein, head of investment firm Lazard Ltd., with headquarters in Bermuda and principal offices in New York, Paris and London. He was awarded a total of $133 million in salary and stock awards in 2008 as part of a new contract, $96 million of which was a special retention award not scheduled to vest for five years.
Lazard shares returned negative 28 percent in the 12 months ended on May 27.
See, when the banksters loot the economy so badly it keels over, you get fired. They get paid millions more. Yay!
This is, indeed, class warfare. And the banksters are winning -- by the only measure they care about.
If atonement is difficult, retribution may prove “brutally difficult,” Starwood Capital Group CEO Barry Sternlicht said in an interview in Davos. As Sternlicht sees it, “everyone wants a head, and that’s not reasonable. To do that, you’d need to take out the top 20 executives at the 300 biggest financial firms.”
Not reasonable? Why not?
20 is not a very great number, after all. It's certainly smaller than two (now four?) trillion.
So, why not turn the banks into regulated public utilities? That would take out the top 20 executives, and a lot more of 'em, too.
NOTE Obama and the Dems bleating now about executive compensation is such pissant stuff; it's a transparent sop to public outrage. Where are the clawbacks? Where are the RICO prosecutions? And where were our tribunes of the people when Tim Geithner's golfing buddies looted $70 billion for salaries and bonuses from TARP money the back in October, immediately after Red + Pelosi + Obama + Bush + Paulson got TARP passed?
Nowhere, that's where they were. The Village is so out of touch that they didn't even think people would notice. Now, the Village knows that we've noticed; they just think we're kabuki-lovin' fools.
UPDATE Sternlicht's bio.
OK, OK, one more, then RL. Helicopter Ben:
“I don’t see any reason to destroy the franchise value or to create the huge legal uncertainties of trying to formally nationalize a bank when it just isn’t necessary,” Bernanke said at the Senate Banking Committee hearing.
The biggest banks, run by the richest people, are now insolvent, and this after sucking up at least two trillion dollars with nothing to show for it.
Where's the "franchise value" in that?
Imagine Bernanke had said that Enron had franchise value; the hearing room would be filled with hysterical laughter.
So how is Big Money different from Enron?
NOTE Unless the ability to suck up trillions, while paying out billions in compensation, is the franchise value. I suppose, to some, that would appeal.
Question: What do you think about nationalizing the banks?
Answer: I think Roubini, Dodd and Greenspan haven’t thought this one through. The U.S. isn’t Sweden, and not just because our blondes aren’t au naturel.[sic**] Their successful approach revolved around a handful of banks but we have 7,500, as well as many S&Ls and credit unions, which would have to be flushed into government hands.
Bzzzt! As Krugman points out:
Here’s Martin Wolf, today:
The four biggest US commercial banks – JPMorgan Chase, Citigroup, Bank of America and Wells Fargo – possess 64 per cent of the assets of US commercial banks (see chart) [chart not available online]. If creditors of these businesses cannot suffer significant losses, this is not much of a market economy.
So as far as this discussion is concerned, we’ve got, like, four banks. The “thousands of banks” line is just a diversion.
Is Gross lying, or ignorant? Inquiring minds want to know. Which leads to another question:
Is Obama lying, or ignorant? Because, as Krugman points out, Obama repeats the same line:
Sweden had like five banks. [LAUGHS] We’ve got thousands of banks.
"[LAUGHS]" Indeed, it's all about the LOLZ!
NOTE Oh, and including the credit unions in the 7,500 figure is bogus, because they didn't get involved in the derivatives mess, the way the looters in Big Money did. They stuck with sound banking practices.
NOTE * Gross is no patzer. PIMCO has about $750 billion in assets under management and runs the Fed's commercial paper markets. He's a made man in the Big Money elite.
NOTE ** It is perhaps needless to say that "natural" is not the same as au naturelle. How true Galbraith's dictum is, that "Wealth, in even the most improbable cases, manages to convey the aspect of intelligence. "
“[BEN BERNANKE] I learned how very hard people in small towns like Dillon, and in communities large and small all across the United States, have to work to support themselves and their families and to offer opportunities to their children,” the Fed chairman said.
Now you learn, you putz?
Where's my trillion, Ben? Why won't you say which banksters got it, and what they did with it?
Now I know why us small town folks cling to our guns....
If only the DFHs would STFU we could get back to business as usual!
[DIMON] “If we act like a dysfunctional family and we don’t finish these things and we’re [what do you mean, "we"?] forever debating them, I think this will go on for several years,” Dimon, 52, said at a conference hosted by the U.S. Chamber of Commerce in Washington. “It’s completely up to us at this point.”
[DIMON] “When I hear the constant vilification of corporate America, I personally don’t understand it,”[No, I wouldn't think so] Dimon said in his speech. “I would ask a lot of our folks in government to stop doing it because I think it’s hurting our [what do you mean, "our"?] country.”
Vilification... You mean, like "What did you do with my trillions, you swelling pustule? Like that?
Dimon called for the U.S. to create a “systemic risk regulator” and put procedures in place to deal with potential failures of large financial institutions.
Stop me before I loot again!
Some smart person at JP Morgan really ought to muzzle Dimon, don't you think? But then, how could they? He's so... so.... so perfect.
UPDATE Oh, and Bloomberg's headline is classic:
Dimon Says Banking System Can Be Saved If Corporate `Vilification' Stops
Down, wantons, down!
From TARP weasel Neel Kash-n-Carry from Golden Sacks in Fred Hiatt's Pravda, first we get:
Our [whose?] belief in free [so-called, see Yves] markets is founded on the idea that each individual acting in his or her self-interest will lead to a superior outcome for the whole. The financial crisis has reminded us that free markets are not perfect -- but they do allocate capital better [if we had a free market, instead of a rigged casino, they might] than any other system we know [better than the regulated market from FDR until the Washington Consensus wrecked it and started looting? I don't think so. A "me first" mentality usually [note weasel word] makes markets more efficient.
Well, that's the ideology. And now we get the double-think. Skip a mere two paragraphs down:
Cutting entitlement spending requires us [who?] to think beyond what is in our [whose?] own immediate self-interest. But it also runs against our [whose?] sense of fairness: We [who?] have, after all, paid for entitlements for earlier generations. Is it now fair to cut my benefits? No, it isn't. But if we [who?] don't focus on our [whose?] collective good, all of us [who?] will suffer.
Second, Kashkari's sense of, er, entitlement is breathtaking, or would be, if it weren't utterly normal. Kash-n-Carry and his bankster golfing buddies get to cash in their huge bonuses for crashing the world economy because they are the Mes who always go first, while the rest of us get to eat cat food because we are the Wes who are always put last.
I'm shocked. Check the comments. Interestingly, the usual wingers and Austrian loons who tend to infest such threads are silent.
NOTE Via HuffPo.
By law, Social Security benefits cannot go down. Nevertheless, monthly payments would drop for millions of people in the Medicare prescription drug program because the premiums, which often are deducted from Social Security payments, are scheduled to go up slightly.
"Seniors may perceive that they are being hurt because there is no COLA, but they are in fact not getting hurt," said Andrew G. Biggs, a resident scholar [sic] at the American Enterprise Institute, a Washington think tank. "Congress has to be able to tell people they are not getting everything they want."
The banksters got $22 trillion dollars NOW NOW NOW in the bailouts, so Congress didn't exactly say No to them, did they? Nor did AEI.
So, banksters aren't "people"?
What are they? Lizards? Weasels? Giant vampire squids? DING DING DING DING!