2/03/2009
Singapore's answer to save the world
Singapore went to Davos with a solution to save the world from another financial meltdown. It has diagnosed the cause of the current crisis to the low pay of regulators and administrators in charge of Wall Street and the financial institutions. The solution is simple, pay the administrators and regulators at least as much as the bankers and fund managers and the problem will not have happened.
The underlying assumption, according to my understanding, is that you pay for good talents. By paying the administrators and regulators as much as the bankers and fund managers, the supertalents will become administrators and regulators. And if they are paid even more, then they will be better than the bankers and fund managers.
Now, how much will be enough to pay these supertalents? The bankers and fund managers are being paid hundreds of millions with the top three getting billions at the peak of the market.
But there is one problem that I noticed. These supertalents of bankers and fund managers were being paid so much and they could not stop asking for more and actually resorted to frauds to continue to demand more and more pay. Would they behave differently if they become administrators and regulators? Won't they be the same greedy and unscrupulous thieves again?
One thing for sure. If this is our solution, we must put it into practice first to show the world it works. The minibond crisis and the rubbish dump stock market are indicators that our administrators and regulators are not being paid enough. Let's pay them as much as the bankers and fund managers first. And when our stock market shoots pass 4000 points and no more similar minibond crisis, then we can tell the world that we have done it.
We can solve all kinds of problems by throwing money at the problems.
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8 comments:
Greed knows no bounds.
Lost Citizen
Bankers and politicians are all overpaid la.
A bit off topic but I say we should pay more money to supertalents to become scientists and engineers. We only need some of them to have breakthroughs. Solve the Aids problem; harness solar energy effectively; cure the earth from global warming etc.
Jobs in R&D are paid too little to entice all the supertalents. If the top scientists are all as rich as Ironman and just as glam, there will be hope for humanity.
Well,below is the most recent case when an ex-regulator who turened more greedy after being paid billions by the bank,PAP does not believe in learning lesson?
Sinner-Spore
Bank of America fires Merrill Lynch head John Thain after more losses uncovered
By Jonathan Stempel and Elinor Comlay
Reuters
January 23, 2009 10:20am
'Dismay' ... Toxic debt, million-dollar decorating bills and 'secret' rushed bonuses at Merrill Lynch.
* John Thain out after new losses found
* Bank of America 'dismay' over toxic debt
* Spent $1.9 million decorating his office
JOHN Thain, former chief executive of Merrill Lynch, has been ousted from Bank of America after the bank discovered surprise losses at the brokerage it bought three weeks ago.
Bank of America Chief Executive Kenneth Lewis expressed dismay last week about the scope of losses from mortgages and toxic debt on Merrill's books.
Investors and analysts had said the losses made Mr Thain's position as head of global banking, securities and wealth management tenuous.
"Ken Lewis flew to New York today, met with John Thain, and it was mutually agreed that his situation was not working out, and he would resign," Bank of America spokesman Robert Stickler said.
Mr Thain's exit was announced a day after he acquired 84,600 Bank of America shares worth about $US483,320 ($737,691), boosting his direct stake to 549,671 shares.
Brian Moynihan, 49, the bank's general counsel and a former investment banking chief, will replace Thain.
Related Coverage
* GE sell-off keeps Wall St's Dow in redThe Australian, 24 Jan 2009
* Merrill chief forced to resignThe Australian, 24 Jan 2009
* No stopping Barclays routThe Australian, 24 Jan 2009
* Banks, miners drag shares down 2.6pcThe Australian, 23 Jan 2009
* Local shares may fall on Wall St slideThe Australian, 23 Jan 2009
Mr Thain and Mr Lewis cobbled together the merger after less than 48 hours of negotiations in mid-September, the same weekend Lehman Brothers slid into bankruptcy.
But Mr Lewis threatened to back out of the deal following shareholder votes at both companies last month after it became evident Merrill's finances were much worse than expected.
US regulators pressed him to complete the deal, said Mr Lewis. Last week, the government agreed to inject $US20 billion in capital, and to share in losses on $US118 billion of debt.
"This is a huge crisis of credibility," said David Dietze, chief investment officer at Point View Financial Services in Summit, New Jersey. "Someone has to fall on a sword."
Complicating the matter was that Merrill announced bonuses in late December, earlier than usual and just before the $US19.4 billion merger closed on January 1.
New York Attorney General Andrew Cuomo is investigating the possibility that Merrill awarded "large, secret, last minute" bonuses, a person familiar with the matter said Thursday. Cuomo's office declined to comment.
Also, CNBC reported that Mr Thain hired well-known Los Angeles interior designer Michael Smith to redecorate his Merrill office a year ago and ran up a $US1.22 million ($1.9 million), including for a $US35,115 "commode on legs" and a $US1405 parchment rubbish bin.
Going by PAP's logic,President Obama should get
$260 million a year(based on GDP) or
$230 million a year(based on population)
I sincerely believe that PAP is trying real hard to repair their snub to black Obamh during the election.
Since the central bankers, regulators and lawyers are all side-kicks of the biggest criminal gang of all -- the government -- it would be wise for the government to 'look after' their thugs properly by cutting them into the action.
Come on, we all know people get jealous and angry when they're not getting theirs and they see others making money by the truckload.
Hired thugs are only in it for the money. Even the power they wield eventually converts to the question "how much money can I make from all of this?"
S'pore's solution to pay (off?) the buggers huge amounts is brilliant!
How much do we pay our ministers, civil servants, regulators, those at GIC/Temasek (a.k.a. those responsible for the huge financial cock up) again?
I would say pay them whatever they want.
what wall street has proven is that a thief is always a thief no matter how much you pay him. an honest man is an honest man even if he is paid not much.
the theory that we can pay to make a dishonest man honest is only good exactly for this. the borderline dishonest man will be honest if he is paid enough.
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