Rot at the core of the system

Summed up in a few simple statistics..

From Michael Pomerleano (The World Bank)

  • In 2008, salaries of the top 10 banks reached $75 billion (up from $31 billion in 1999), while cash dividends to shareholders were only $17.5 billion. Management took 4.3 times more than shareholders at a time when shareholders were injecting capital and government was guaranteeing deposits. He pointed to the critical principal-agent fiduciary problem. Essentially, financial sector losses will be paid for by future taxation (large fiscal debt) or inflation. To this I add that the US Treasury “stress tests” led to an injection of roughly $67 billion in 2009. This year alone, the committed bonuses are more than $75 billion.

And distressingly little is done to address this. How did we get here? We’ve featured the Simon Johnson The Quiet Coup before, but it still remains in a class of it’s own. If you wonder, Simon Johnson is not just any kind of conspiracy theorist. He used to be chief economist of the IMF..

3 thoughts on “Rot at the core of the system”

  1. Admin: Can we get a forum going on the next chapeter for InterOil. We have heard it stated that once we know the full magnitude of Antelope #2 than we can reach a FULL deal, not prelim. So whats next? what should we be waiting to hear to take IOC to the next chapter, again thanks for all your hard work in the past, I look forward to seeing other viewers thoughts.

    God Bless

  2. Thanks Oilman, we’ll post something soon, probably with the next DST results.

  3. HAHA, nice timing on that response…looks like we are drilling horizontal leg #2 on the well, a couple more months now on this operation. great news. Im sure the market will interpret things differently….. we will see

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