‘Bonus rage’ is surely a response to our lack of control over our destiny as well as the fallout from our reduced circumstances. Many, if they get to keep their jobs, expect to be working for the rest of their lives. The others, well…those layoffs look permanent. Who will save us from this mess?
Certainly there is too much greed for our own good. But add to that the hubris about the quality of the talent who expect the bonus and brought about the demise of our financial system and you have pure theater, not to mention injustice on a grand scale.
Not to bonus the talent, according to AIG’s CEO, might mean they leave for another firm which is more generous.
Huh? How can you be more generous than letting them keep their jobs? The injustice is giving them a bonus to try and do better next time.
Traders (derivatives, pork bellies, stocks) are mechanics with good tools. They work for the right organization, have surplus capital resources behind them, quality software systems, and quantitative models (some lucky) at their disposal. And, it might be said, very lax supervision. Add a solid I.Q., hard work, a focused dedication to getting personally rich, and you may produce a few good players.
Here’s the rub about bonuses. What management employs them to engage in is incomprehensible to many who pay them. The bonus issue arises when all the stars are perfectly aligned (as they may be several times each work day) and such activities produce expected profits.
By most outsider accounts these profits would be considered monumental. The morality of it is another dimension.
We know profits are manufactured when credit entries from the use of other people’s money appear on the organization’s books as proof. These trading activities occur many times in comparable offices around the world as money rides the global time zones 24 hours a day.
This good fortune is thus considered worthy of being shared with “the talent” who produced it in the form of a bonus for a job well done.
No profit. No bonus. Now that’s justice. What’s so difficult about that?
Copyright 2009 William M. MacKay
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( 2.9 / 159 )If anything is apparent to the poor and middle class these past few months it is simply these 3 truths;
1.AMERICA IS NOT THE HEARTLAND OF CAPITALISM.
If it were true the financial failure of AIG, General Motors, and others in the same predicament would be resolved by the laws of bankruptcy. They apply to everyone else.
Arguments against doing so (the ‘too big to fail’ excuse) prove that there is a lack of competition in the marketplace, a cornerstone of the “American” way, and a linchpin of capitalism.
2.THE FABULOUSLY WEALTHY PROSPER ON THE BACKS OF THE PUBLIC.
This comes at a time when that same public are being asked to save the ‘system’ the rich promote as the salvation of the poor. (“You, too, can get rich.”)
The bailouts and the non-stop printing of money to reward THE RICH who failed are setting all of us up for another parasite known as inflation.
In this case Saving is for Suckers becomes a reality, not just the title of a book.
3.TAX THE POOR AND MIDDLE CLASS AND GIVE TO THE RICH
The redistribution of income is continuing on a massive scale begun during the Reagan years. The income inequality gap between rich and poor has been widening for years and economic mobility has been declining.
Executives with Wall Street and Fortune 500 experience move seamlessly between senior government positions and their private enterprise management thrones and directorships. They rule with the support of the 42,000 lobbyists registered in Washington.
The corporate/industrial/military complex is in control of the budget. The business of America is Corporate Socialism.
CONCLUSION
The rich should be getting worried. America is the most heavily armed nation on the planet and I’m sensing that the natives are getting restless.
Copyright 2009 William M. MacKay
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( 3 / 151 )Performance bonuses for sub-prime performers have riled all of us. Again!
Thankfully, President Obama is on the side of fairness and equity in condemning the practice fueled, as it is, by tax payers’ money.
The more worrisome issue is the ongoing lack of responsibility that people everywhere exhibit who have been the catalysts for this crisis. It just seems like business (greed) as usual. Line up at the trough and push for more. These folks make pigs look good.
It is essential that we call the entitlement mentality so prevalent among so many exactly what it is; access to the highest quality lifestyle for the fewest obligations. Preferably none!
Whatever happened to citizenship?
No country can long endure when all the people all of the time expect a free ride. There is no express to the promised land. No where. No how. (Assuming you do it legally.)
The privileges we enjoy are not free. The rights we so easily take for granted should cost something for the very reason that they are so precious. And they do. That’s the whole range of what good citizenship means.
Just once I would love to hear someone stand up and say, “I have been a greedy, selfish sonofabitch and want to make things right by giving back my ill-gotten gains. The needs of the country come first.”
But then again, I still believe in the tooth fairy.
Copyright 2009 William M. MacKay
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( 3.1 / 154 )Got a credit card? Are like the average U.S. user?
You owe $5729.00.
That’s only nominally higher than 12 months ago. Not so bad given the hard times.
But it’s still too high given the creep in interest rates issuers are demanding.
Keeping up your payments on credit cards is vitally important to your lifestyle. Try booking a hotel or buying any kind of ticket without one and you learn quickly that cash is not yet king. (And may never be the way the world’s central banks are printing money these days.)
By all means protect your credit rating by paying down debt although doing so at the expense of your mortgage payment or other loans must only be a short term strategy.
Your credit history is important. But don’t keep looking up your score as often as those the pop ups and banner ads keep appearing on your computer screen.
Too many searches make your credit suspect.
Copyright 2009 William M. MacKay
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( 3 / 158 )The U.S. savings rate just hit 5%.
But how long will this last? Is this a sea change in consumerism or simply a classic response to fear?
We have a long way to go to match the Chinese (+35%) and the Japanese (+20%) but should we even come close to their saving rates then we have entered the genre of science fiction.
And like the scary scenarios many of those stories reveal we will be in for some unbelievable outcomes if savings should come anywhere close to those Asian rates. Recession would evolve quickly into something bigger and longer.
But I hardly think it likely that we will step into this paranormal range after decades of debt and leverage to enjoy the lifestyle we want when we want it. No deferred or postponing of gratification seems to fit with our experience.
When I wrote SAVING Is for Suckers; Unless You’re Spending on Purpose I didn’t imagine my worse fears of a global meltdown would actually come true. Now it is a fact of life and we are all responding to the new reality. But the title, I think, still holds true.
In fact, less spending is now responsible for maintaining and improving whatever the lifestyle you manage to enjoy today. It had better be producing a great return in satisfaction and moving you toward your goals and aspirations, albeit more slowly.
If not then saving in the face of foolish spending is still an inadequate strategy for sustaining all that you value.
The new leverage of the day is found in spending on the purposes you truly value most.
Copyright 2009 William M. MacKay
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