Category: Capitalism

British Call For Executive Bonus Regulation

On By southwerkIn business ethics, Capitalism, ethics, Government Failure

British Business Secretary Vince Cable calls for stiff bonus regulations.

From the BBC –

Mr Cable said disclosure was vital.

Speaking to BBC Radio 4’s Today programme, he said the potential scale of 2010 bank bonuses remained “of considerable concern to the government”.

He added: “I’ve launched a consultation in my own department on corporate governance that takes in issues of remuneration and disclosure, and it may well be that that’s a better way of tackling it.

“I wouldn’t just cover banks, but highly paid executives in general. But we have to have a system whereby executive pay is available to shareholders so they can make proper decisions from it.”

Isn’t this something we should be talking about? Currently, business bonuses are at all time highs while the middle class barely hang on. Why don’t we talk about austerity for someone who isn’t a homeowner or a worker?

All over the United States, salaries have been stagnant for decades or even reduced. Some fields have diminished in size or virtually ceased to exist. Why should business bonuses be immune for the same kinds of cuts?

From further down in the article –

Mr Cable said he was “not persuaded” that banks realised they needed to limit bonuses, saying excessive remuneration in the sector remained a “major irritant”.

He added that if the banks gave out substantial bonuses at a time when the wider population faces the impact of austerity measures, it would be a “major provocation”, and that the government had the power of raising taxation to deal with the matter.

We’re not even having a discussion about this. Why is it always the middle class that gets hit? Why do they talk about Social Security and Medicare when there is so much money among so few who accomplish so little? How is it that Americans who paid into Social Security their entire working lives can be referred to as the “Greediest” generation as if they were two bit thieves?

James Pilant

Wow! Home Sells For 12% Of Asking Price

On By southwerkIn Capitalism2 Comments

From CBS Money Watch –

Home sales in New York City have been holding up better than almost everywhere else in the country. But that might be changing.

It’s no secret that sale prices in the current housing market are way down, but in one historic New York City Upper West Side building condo prices are crashing.

Originally listed at more than $2 million, a condo in the Apthorp building was sold for $228,900 according to the New York Post.

The one-bedroom penthouse sold for 88 percent below the owner’s asking price of $2,025,765. Maybe it’s the market or maybe people just don’t think a one-bedroom condo is worth a couple million (even in New York).

I am impressed at the scale of the losses on that transaction. Maybe the housing market isn’t recovering as fast as the experts think?

James Pilant

Matt Taibbi Shoots And Hits!!

On By southwerkIn business ethics, Capitalism, ethics, Government Failure, Philosophy of Business, White Collar Crime

Matt Taibbi is as usual dead on target. He does a veritible Indian War Dance on the horrors of the foreclosure crisis. Read the paragraph below and then go spend a delightful (quality of writing) and painful (financial corruption) story.

The moral angle to the foreclosure crisis — and, of course, in capitalism we’re not supposed to be concerned with the moral stuff, but let’s mention it anyway — shows a culture that is slowly giving in to a futuristic nightmare ideology of computerized greed and unchecked financial violence. The monster in the foreclosure crisis has no face and no brain. The mortgages that are being foreclosed upon have no real owners. The lawyers bringing the cases to evict the humans have no real clients. It is complete and absolute legal and economic chaos. No single limb of this vast man-­eating thing knows what the other is doing, which makes it nearly impossible to combat — and scary as hell to watch.

Excellent, exactly. This is not a moral crisis where six million Americans suddenly decided to buy too much house. This is a moral crisis where the biggest financial institutions in the world decided to take the home owners of America on a little trip into world finance. The banks had a hell of a vacation. The home owners never made it back.

James Pilant

The Homeowner As Victim, Not Deadbeat (via Chasing Fat Tails)

On By southwerkIn business ethics, Capitalism, Government Failure, White Collar Crime3 Comments

Amen!!

I’ve blogged on this exact subject.

You can be a mortgage company or a bank and your moral status is unchanged by the destroying the world economy and by using mortgages as play money in the global securities market. But if you are a consumer who falls behind in payments on your house, you’re evading your personal responsibility and should be booted out, children, furniture, pets and all.

James Pilant

One thing that annoys me to no end is the constantly espoused view that purportedly delinquent homeowners "deserve" to get foreclosed on. The idea is that when a homeowner defaults on his payments, he loses moral claims to "justice" when it comes to foreclosure, since he violated an agreement. In the context of the current foreclosure crisis, the view seems to be that ownership of the note is a purely legalistic issue; it doesn't get over the mor … Read More

via Chasing Fat Tails

Lots of Links on the Foreclosure Fraud Crisis (via Rortybomb)

On By southwerkIn business ethics, Capitalism, ethics, Government Failure, Philosophy of Business2 Comments

As usual, our good friend, Rortybomb does not let a day go by (even a holiday) without staying on top of the mortgage foreclosure crisis.

My compliments!

James Pilant

If you are not reading Rortybomb, let me ask you, “Why not and how soon can you start?”

Like you were going to get any work done today. Chris Hayes has really been on the foreclosure crisis over at MSNBC. Here he is, substituting for Lawrence O'Donnell, interviews noted foreclosure defense attorney Bubba Grimsley about servicer abuse. I can't embed the video, but the link is here (also here). Here he is on Rachel Maddow also interviewing Matt Taibbi on the recent foreclosure fraud … Read More

via Rortybomb

I Was Wrong – The TSA (Transportation Security Administration) Should Be Abolished

On By southwerkIn business ethics, Capitalism, ethics, Government Failure

When the humiliating scanners and grope searches were put in place, I believed that the government could be convinced to make changes that would respect human dignity and American rights.

It has become evident that the government from the President on down, have no interest in having a discussion on the issue. They have made it clear that they will not change course.

Their response to the legitimate claims of American citizens have been a rush of public officials and “so called” security experts to explain that this is absolutely necessary and that those who oppose these measures do not understand the dangers. At every point in this series of events, those criticizing the policies have been insulted, marginalized and ridiculed.

I have predicted and I firmly believe that the government’s next step will be to blame people with views like mine of empowering the terrorists.

Based on my observations of what has happened so far, it is now evident that private screening companies are far more amenable to public opinion and criticism than the government of the United States.

The government has taken the position that criticism on this issue is the result of internet activists and paranoid zealots.

I have long been a critic of private industry and the common abuse of citizens by exorbitant fees and other wrong doing.

But the government has indicated through its actions that criticism is not acceptable.

It is as if the government itself were a private corporation acting as if its actions were merely its own concern.

This is wrong.

Destroying this regulatory agency will be an important signal to the government to heed the people of the United States and their legitimate concerns.

I do not believe that this administration has any interest in middle class Americans, their struggles or their concerns.

James Pilant

Listen To Nouriel Roubini!

On By southwerkIn Capitalism

Larry Swedroe writing for CBS Money Watch –

Nouriel Roubini gained fame for accurately predicting the financial crisis that began in the fourth quarter of 2007. As his descriptions of the crisis proved to be accurate, he became a major figure in the U.S. and international debate about the economy, regularly appearing on CNBC. People pay attention to what Roubini has to say.

According to Wikipedia, Roubini spends much of his time shuttling between meetings with central bank governors and finance ministers in Europe and Asia. In 2009, Prospect Magazine voted him No. 2 on its “list of the world’s 100 greatest living public intellectuals,” Foreign Policy magazine ranked him No. 4 on its list of the “top 100 global thinkers,” and Time magazine him one of the 100 most influential people in the world. He has appeared before Congress, the Council on Foreign Relations and the World Economic Forum at Davos.

Mr. Swedroe goes on in the article to criticize Roubini and talk down economic predictors of all sorts.

I don’t agree. Roubini is very good at what he does. No one paid any attention when he predicted our current morass.

Are we going to make the same mistake twice?

James Pilant

Markets And Morality – Michael Sandel

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business

This is fascinating. I was deeply impressed. You should give this a listen if you have any concern for the free market’s effect on morality.

James Pilant

Paid Pregnancy – India’s Newest Industry?

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business3 Comments

I’ll just let this speak for itself, although the temptation to speculate of what happens to a child that hears sitar music in the womb is difficult to overcome.

James Pilant

Debt Collectors Are Using Facebook!

On By southwerkIn business ethics, Capitalism, ethics, Government Failure, Philosophy of Business

From the Associated Press –

A Florida woman claims a debt collector went far beyond the usual phone calls in an attempt to recoup $362 for an unpaid car loan by sending her messages on Facebook — and by telling family on the social networking site to have her call the agency.

Melanie Beacham, who is suing the debt collection agency Mark One LLC in a Florida court, said she never expected to hear from a collection agency on Facebook, which she used to talk to loved ones and post the occasional photo or funny status update.

“I was shocked when I found out these collectors used Facebook to contact my family because they knew exactly where I was,” Beacham, 34, told The Associated Press in an e-mail on Thursday. “I’m angry they caused me so much embarrassment with my family.”

When will it stop? It probably will not. Now, that they have established that they can humiliate people, they’ve struck gold.

The federal government is the only power who can defend us from this kind of abuse. Without 50 state authority, any legislation at the state level is hit or miss.

But the federal government is a protector of large companies in almost all cases. It is little inclined to act in the public’s behalf and barely representative of the people.

You can see from the current controversy over airport scanners how little concerned they get over a public problem. An industry problem causes them to jump to attention and perform. A financial industry problem has them barking like a trained seal.

Where do we go for help?

James Pilant