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You Can't Do Good and Do Well on Wall St.
The Wall Street motto that I knew was: Monday through Friday you did
well, On Sunday you did good. In this case doing ‘well’ was making
money, doing ‘good’ is something you did that benefited someone else or
the community in general. Mixing the two was bad mojo.
If you
look at the amount of charitable donations by the big hitters (and the
not so big) on Wall Street in 2007 you will see that nothing has
changed since I was on the dance floor. They we coining money like mad
Monday through Friday and giving a big chunk back over the weekend.
Think of it like confession. It cleanses the soul.
In his
speech today President Obama asked the big banks to “Do the right
thing”. To be fair with their customers, tell them up front what the
fees are, to open up their vaults and start lending again. He urged the
lenders to change their ways and to cooperate with the new laws that
are coming. Basically he asked them to do Good.
You can be
certain that the banks will give lip service to these lofty ideals and
they will continue to do good things in the communities that they
operate in. But the idea that they are actually going to deliver on
this is just silly. Wall Street does well, not good. 09 is no different
than any other year. The President better have a big stick available
because the carrot he is offering to Wall Street is not going to work.
He’s
a terrible story about what happens when you try to mix doing good with
doing well. This story took place a long time ago in a far off land.
Some
native people had the rights to forest some land. Some big interests
wanted that lumber. The deal needed money and I got involved. It was
sold as a “do good” deal.
The locals wanted work and there
were big transportation problems. The solution was to build a
processing facility on site. That made everyone happy. Part of the deal
required the enterprise to fund a school and a clinic. There was also
profit sharing. These bells and whistles made it look good.
But
there was a snag. In these woods there was an endangered animal. No one
had seen one for years. Environmentalists protested. Since this was a
“good’ deal a compromise was reached. People were allowed into the
forest to search for the animal in question. If they found the animal
the plans to harvest the lumber would be scrubbed.
They stayed in the woods for months looking. They lived in tents. They never saw a thing. So the project went forward.
Several
years later I learned that before the observers were allowed into the
forest the natives killed all of the animals that needed the
protection. It was money, jobs and greed that did them in. Bad mojo.
»
This story sounds apocryphal, and I'd like a reference on it. I sincerely doubt it happened, primarily because no matter how endangered a species is, it is very unlikely a group of people could go into the forest and kill all the remaining animals and NOT GET CAUGHT doing it....let alone do it at all.
Animals go extinct primarily by accident. The dodo was not deliberately hunted to extinction. It was always assumed, by those hunting the dodos, that more existed. The same was true of the Passenger Pigeon. While the massive hunts were getting noticeably smaller, nobody was standing there saying "hey, let's get rid of all of them". It was only after it was too late that people realized they had so very few left - not enough to keep them going.
I agree the story is a good one which indicates that money and greed sometimes have a bad outcome. But more often than not, as Julian Simon once showed, these forces have positive outcomes because they promote positive and optimistic views on progress.
It's unfair to say that extinctions caused by man are evil and wrong when the vast majority of total extinctions were natural events - and man, being a force of nature, is part of that cycle of natural events.
Clearly, that's not justification to say "let's go kill everything we can and pollute the world for money", but in the long run capitalist nations are the cleanest on earth because they reached a point when they realized sustainability is impossible with a zero-sum approach to the management of natural resources. More importantly, it is the profit motive which will drive the "Green" revolution, as alternative sources of energy and resources become cost-efficient.
Obama's point is well taken, but misguided. He fails to recognize the powerful and beneficial forces at work, and rather than coax more out of their beneficial nature, he seeks to scold them and scare them into submitting into a more beneficial outcome. This, history shows, is a coercive means of reaching a desired outcome - which never ends well.
Sorry but I am not impressed by those who do "good" with money obtained via fractional reserve banking in a government-backed monopoly money. This is a case of looting the poor and all money holders Mon-Fri and giving back some of it on Sunday. (Oh, and wrecking the economy with the so-called business cycle to boot)
If it does not impress me, a mortal, should it impress God?
Solution: Free banking and money creation.
Just another way of saying, rob peter of trillions with one hand, pay paul with a couple measly million on the other.
This notion allows for a broad definition of "doing well," which of late is akin to the junkie's definition of getting slaked by the next fix, no matter what the long term cost is to self, company or the nation. Yes, attempting to compartmentalize ethical behavior sure has worked out well for the street, huh.
Agreed that a big stick is needed -- Wall Street will always fall back into its self-destructive path of "doing well" to the point that it takes us all down the "well" well with it unless some good laws are there to stop it.
We just have to get robbed enough and angry enough to take up our big stick and start swinging.
Sure the banks will do good...to their own pockets.
Now that they got the taxpayer to protect them from margin calls, it's a licence to pig out!
Obama couldn't have made worse.
How much did Goldman bet against the Yen ?
Why is Oneill complaining about Yen strength ?
Why does he call yen strength September silliness ?
Will the yen trade ruin their "perfect" trading days record?
Is America so stupid ? I am beginning to believe so......
I couple my face in my hands. Half in disgrace and
half with a vexing for forgiveness. Will I be
forgiven? You know it's no and I do too. I am not
a criminal but my bosses are. Look there, as they
are shuffled into the dark class windowed cars.
Like it matters, the public only sees me - and
they will stone me to death.
good poetry man!
"In his speech today President Obama asked the big banks to “Do the right thing”."
Unfortunately, in this case, "do the right thing" means re-inflating the credit bubble while the President hopes that it doesn't pop before he leaves office, not putting all the trash debt on the bank ledgers out in the open and actually being honest about the value of their assets.
Vampire squids steal Monday thru Friday, and on Sunday tithe to charities which promise to help their kids become successful vampire squids.
Timber Industry & the Spotted Owl
http://www.scu.edu/ethics/publications/iie/v4n1/homepage.html
Did Goldman (Oneill on Bloomberg) lose its footing on a Yen bet ? He calls yen strength September silliness. I smell a can of worms.
I think Obama realizes the 'Obium" doses are going too far already and the Wall St. recklessness will do him in way before the Presidency is over. Obama's time will come way before his 4 years are over !!
Capitalism = gettin fucked
He said a far off land, usually that means over the seas. Appalachia is still a half day drive away from Washington DC and the surrounding counties, the richest in the land.
The set-up sounds like Howard Zinn's treatment of the progressive era a hundred years ago. The progressive leader is trying to catch up with the natives before the natives take regulation into their own hands.
And, yes, so far Obama seems to be working on a DVD box set of the greatest speeches on feeling good by thinking well. Where's the governance? Otherwise an in-demand speaker gets a lot more than a president's salary. How much does Poppy Bush get for a standard stand-up?
Pretty typical liberal thought pattern, what would you expect from the Empty-Suit-in-Chief. It's Pollyanna, Yellow Brick Road, Kumbaya, insert whatever cliche you prefer. And I continue to love the bits about asking banks to lend to consumers and businesses who are already tapped-out. Perhaps they can borrow to pay their higher tax bills under President Kumbaya.
Oh well, it's what America voted for (albeit a narrow majority). I'll continue to "Hope" that there is some "Change" left in my pockets when the liberals are done with their remodelling projects, but I'm not "banking" on it.
BTW for some parallels/preview to America's implosion in the 21st century, I highly recommend Niall Ferguson's "Empire" about the history of the British Empire. I'm reading it now, simply fascinating stuff.
He branded his Vampire Squid black card...
While most unfortunate, sounds like a story from rural USA economics 101. When you got nothing else but forestry or farms out in the boondocks...
Would that story 'theoritically' be based in the western Appalachians of North Carolina? There are regions that progress forgot about 15-20 years ago.
i've heard scary stories about that region, hard to believe it still exists in America.
Don't know nothing about scary, but it's beautiful countryside.
I am supposing that a region which has nothing on the ball, and politicians generally choose to forget, may well take their own stance on economic improvement.
"it's beautiful countryside"
Except for all the mountains that they've literally shaved in half. And the myriad color of chemicals leaching out of those gashes and down into the hollers.
Humankind is f**ked. Whether it's next year or a thougsand years from now, this experiment has an expiration date on it. And however it happens, we'll do ourselves in.
Having visited North Carolina's mountains, I believe you are geographically confused. Rode the Blue Ridge parkway ~ 2 years ago (nearest to Boone & southwards), and have rafted a few rivers in that region (Banner Elk, Grandfather Mountain, etc). I don't live there so can not speak to ongoing practices, though I've generally been in the vicinity every other year for oh, most of my 30+ years.
Further up the range into West Virginia, where that brand of coal mining is being done you are correct from what I've read or seen.
This is a lesson in unintended consequences if nothing else...
Do well- Foreclose the mortgage and liquidate it as quickly as possible to minimize the loss .
Do good-- Modified the mortgage, extend and pretend and suffer the agony loss in the end. (Man, did you see the MBS-sub prime 2007, AA class is priced at 4 cents, while AAA class is priced at 28c. It could go even lower once alt-a, option arm implode in the near future)
Gee, maybe the organizer-in-chief was trained in the do good business while do well from OPM.
The federal government should heel the advice of Wall street: Do well and let the chip fall, TBTF or not, and then do good and put the safety net under the dislocated workers.
Obviously, politicians don't know the difference between well and good. All is good, but not well.
Doing good (DEM): Ted Kennedy politicizing the debate for healthcare and education.
Doing well (DEM): papa Joe raking in big ones by selling short 75-80 years ago, and oh yeah running liquor / booze. Or so I supposedly read it somewhere.
Doing good (REP): George HW Bush being a fighter pilot in WWII
Doing well (REP): join the Carlyle group post-presidency, make friends with Arabian oil do-gooders
Your story makes me sick and is a nice allegory for what Wallstreet is doing to us all.
This speech by Obama, which I have not yet heard in toto, but merely the "best of. . .", sounds to be one of the most superfluous, trite, meaningless, vapid, senseless and otherwise useless utterances in human history.
The guy is phoning it in.
Whoever flagged Ned for junk may as well flag me as well.
I give Ned the old two thumbs up.
Seriously, what reform is going to make it through this congress that could possibly have any relevancy?
My thumbs agree, go Ned!!
The guy himself is a meaningless POS.
I hope I'm not going to be an endangered specie someday to suffer the same fate... Killed by money, jobs & greed. My lionhead will end up on a Wall street mantle....
“Why is it that we’re going to cap executive compensation for Wall Street bankers but not Silicon Valley entrepreneurs or NFL football players?” he said.
DEAR ALL, I AM ASHAMED OF THIS GUY. IF HE DID SAY THIS SENTENCE THEN ,WITHOUT ANY DOUBT,THIS MAN IS THE MOST EMPTY HEADED PRESIDENT THAT us OF A HAS HAD.
HE COMPARES WALL -STREET MUMBO-JUMBO TO TECH SECTOR INNOVATION!!! THIS IS UNTHINKABLE FROM AN EDUCATED MAN. WALL-STREET IS BASED ON A ZERO-SUM PRINCIPLE. MONEY MADE BY THE BANKS IS LOST BY THE PUBLIC. IT IS NOT THE CASE IN TECHNOLOGICAL INNOVATIONS. OMG, THIS GUY IS BLANK. HOW COME IT HAPPENED SO ? HE CANME OUT SO INTELLIGENT MONTHS BACK!!
You speak with a slanted view. The only reason a tech company is able to inovate and create substance is because people like me put together the deals that fund the company for 3 years without returns (startup); speculating that the inovation will revolutionize an industry and creating jobs in the process. Hopefully the wizards do well and I can sell my stake at a profit and if they fail well.... you lose your time.... I lose millions. Without wall street and banks, you do not get off the ground.
But to be perfectly honest, your only comparative advantage is that you have a shit load of money.