Capping executive pay at companies that are being bailed out is a good step. But Obama and Geithner can't stop there.
As Niall Ferguson writes on HuffPost: "Existing shareholders will have to face that they have lost their money. Too bad; they should have kept a more vigilant eye on the people running their banks... Financial history is, after all, an evolutionary process. When old banks die, new banks swiftly take their place."
That's called capitalism, Mark. I missed the chapter in Adam Smith -- or Ayn Rand for that matter -- where it says that equity holders in insolvent banks need to be paid taxpayer-funded dividends. Did you say "clueless"?
Capitalism comes with great rewards -- and commensurate risks.
Allowing stockholders to reap the benefits during the good times... and to keep reaping them in the very bad times -- at taxpayers' expense -- isn't capitalism. It's lunacy. And only people like Mark Haines, their vision limited by Wall Street blinders, can utter the nonsense he uttered this morning.
Wednesday, February 04, 2009
From today's Huffington Post: