Wall Street Crisis September 17, 2008
Posted by Da in Finance.Tags: Finance, Misc
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Two big investment banks, Lehman Brothers and Merrill Lynch, disappear over a single weekend. Together with Bear Sterns, these two once prestigous companies are history now. (There may be more to come…)
These companies, arguably, attract the brightest people in the world, mainly by their extraordinary pay. Still, they collapse in the end and their stock become pieces of crap… Why? I think Prof. Ho has a concise but insightful comment here:
As he points out, basically, it is all about greed. And as some others point out, people there may not care about whether their company fails in the end or not—getting stellar bonuses in the good years is more important… This is a very interesting mechanism. If it does not gets corrected, and risk management is not totally separated from trading, these kinds of collapses will repeat again and again…
it is about greed.. also, when the time comes, when faith is lost.. it’s hard to restore.. and there is more to come…
The fundamental crisis of capitalism: greed & selfishness vs initiative & efficiency
i guess a lot of stuff in Marxism is right. except for the realization of communism…