So much for limits on executive comp...

[John Ranalletta]

Not that they should be enacted anyway, but the g-man sets the limits:

So you can imagine our surprise when we came across this employment contract yesterday for Freddie’s (Freddie Mac) newly named CFO, Ross J. Kari. Here’s a few key bullets:

• annual compensation of $3.5 million (this includes $675K in salary, $1.6 million in something called “additional annual salary” and $1.1 million in a target incentive
  
• a $1.95 million signing bonus•immediate buyout of Kari’s house (or perhaps houses)
• reimbursement for travel between Washington D.C. and Kari’s residences in Ohio, Washington and Oregon

You might recall that Freddie Mac is bankrupt.

 

[Matts_12GS]

How's that "hopey-changey" thing work again?

[Eric S]

Wow, he must be really good at telling people to do stuff.

[Mike O]

[*]reimbursement for travel between Washington D.C. and Kari’s residences in Ohio, Washington and Oregon

...

 

And we're surprised.......because? I really hate saying this, but I'm still trying to straighten my 'concern-o-meter' after the bailout. Nothing has fundamentally changed beyond a having a few less bucks in our wallets.

 

Mike O

 

[steve.foote]

And we're surprised.......because? I really hate saying this, but I'm still trying to straighten my 'concern-o-meter' after the bailout. Nothing has fundamentally changed beyond a having a few less bucks in our wallets.

 

Mike O

 

Mike, you hit on the most frustrating thing about this whole mess. Nobody learned a damned thing.

 

The beauty of capitalism is that it is self governing. Free markets WILL balance themselves and clense excesses automatically. Those who do wrong will mostly be the ones who will bear the brunt of a correction, while those who do what is right will mostly be rewarded. It isn't a perfect system, but it does work very well if it is allowed to make corrections on its own. And, it is the best economic model, currently known, which produces the highest standard of living for the most people.

 

We've become a society which embraces the up side of capitalism, but refuses to accept that there is also an occasional downside. Had we not hamfistedly mettled with the market at the onset of this inevitable correction, we would have experienced a recession which would have been sharp and painful, but quick and just, unlike the years-long. anemic, unjust recession we're in right now. And, it would not have added a penny to our national debt.

 

You aren't the only one coping with the aftermath of this fundamental shift away from capitalism. It's had a life-changing effect on how a lot of people view our nation and our future. It has the distinction of turning optimists into cynics and dulling an entire generation of producers while financially enslaving the next. The only thing you can count on today is that the market WILL eventually correct itself, but by then, the perpetrators of this great folly will be long gone along with the riches they were able to plunder while gaming a "bailout" foolishly intended to try and prevent the pain.

 

Steve

[John Ranalletta]

Prepare to stand up and cheer...somebody's finally found his gonads in Washington.

 

 

 

Congressman Grayson asked Federal Reserve Chairman Ben Bernanke the same questions. Here is the exact exchange:

 

Grayson: “So who got the money?”

Bernanke: “Financial institutions in Europe and other countries.”

Grayson: “Which ones?”

Bernanke: “I don’t know.”

Grayson: “Half a trillion dollars and you don’t know who got the money?”

 

[Lawman]

And we're surprised.......because? I really hate saying this, but I'm still trying to straighten my 'concern-o-meter' after the bailout. Nothing has fundamentally changed beyond a having a few less bucks in our wallets.

 

Mike O

 

Mike, you hit on the most frustrating thing about this whole mess. Nobody learned a damned thing.

 

The beauty of capitalism is that it is self governing. Free markets WILL balance themselves and clense excesses automatically. Those who do wrong will mostly be the ones who will bear the brunt of a correction, while those who do what is right will mostly be rewarded. It isn't a perfect system, but it does work very well if it is allowed to make corrections on its own. And, it is the best economic model, currently known, which produces the highest standard of living for the most people.

 

We've become a society which embraces the up side of capitalism, but refuses to accept that there is also an occasional downside. Had we not hamfistedly mettled with the market at the onset of this inevitable correction, we would have experienced a recession which would have been sharp and painful, but quick and just, unlike the years-long. anemic, unjust recession we're in right now. And, it would not have added a penny to our national debt.

 

You aren't the only one coping with the aftermath of this fundamental shift away from capitalism. It's had a life-changing effect on how a lot of people view our nation and our future. It has the distinction of turning optimists into cynics and dulling an entire generation of producers while financially enslaving the next. The only thing you can count on today is that the market WILL eventually correct itself, but by then, the perpetrators of this great folly will be long gone along with the riches they were able to plunder while gaming a "bailout" foolishly intended to try and prevent the pain.

 

Steve

 

Steve,

Well said...

[Lawman]

John,

 

Simply amazing..

[Hermes]

The beauty of capitalism is that it is self governing. Free markets WILL balance themselves and clense excesses automatically. Those who do wrong will mostly be the ones who will bear the brunt of a correction, while those who do what is right will mostly be rewarded. It isn't a perfect system, but it does work very well if it is allowed to make corrections on its own. And, it is the best economic model, currently known, which produces the highest standard of living for the most people

 

Sure, most people can agree with that, and if left to its own devices, Capitalism will correct itself and weed out the weak and the wicket.

But in this case Capitalism took it to the self-destruct level and then Socialism (as in tax payers, who already lost everything) intervened and provided a comfortable safety net for All who done wrong.

That's balls... and worth repeating.

You do that too often, and Socialism will correct itself... speak uprising of those who foot the bill for the wicket.

[steve.foote]

John, I'm liking what Grayson is saying a lot, but I'm afraid he's working the aft end of the problem. Had the bailouts not occured in the first place, there would be no need to investigate where the money went. It is the investigation of the origins of this debacle which would be the best use of his very capable forensic skills.

[Fugu]

But in this case Capitalism took it to the self-destruct level and then Socialism (as in tax payers, who already lost everything) intervened and provided a comfortable safety net for All who done wrong.

 

Capitalism without bankruptcy is like Christianity without hell.

[Hermes]

But in this case Capitalism took it to the self-destruct level and then Socialism (as in tax payers, who already lost everything) intervened and provided a comfortable safety net for All who done wrong.

 

Capitalism without bankruptcy is like Christianity without hell.

 

I am a lost soul, but from what I have picked up along my way, those destined for hell, are the perps, not the victims.

I also understand that there is no bail-out in hell.

[motoguy128]

And we're surprised.......because? I really hate saying this, but I'm still trying to straighten my 'concern-o-meter' after the bailout. Nothing has fundamentally changed beyond a having a few less bucks in our wallets.

 

Mike O

 

Mike, you hit on the most frustrating thing about this whole mess. Nobody learned a damned thing.

 

The beauty of capitalism is that it is self governing. Free markets WILL balance themselves and clense excesses automatically. Those who do wrong will mostly be the ones who will bear the brunt of a correction, while those who do what is right will mostly be rewarded. It isn't a perfect system, but it does work very well if it is allowed to make corrections on its own. And, it is the best economic model, currently known, which produces the highest standard of living for the most people.

 

We've become a society which embraces the up side of capitalism, but refuses to accept that there is also an occasional downside. Had we not hamfistedly mettled with the market at the onset of this inevitable correction, we would have experienced a recession which would have been sharp and painful, but quick and just, unlike the years-long. anemic, unjust recession we're in right now. And, it would not have added a penny to our national debt.

 

You aren't the only one coping with the aftermath of this fundamental shift away from capitalism. It's had a life-changing effect on how a lot of people view our nation and our future. It has the distinction of turning optimists into cynics and dulling an entire generation of producers while financially enslaving the next. The only thing you can count on today is that the market WILL eventually correct itself, but by then, the perpetrators of this great folly will be long gone along with the riches they were able to plunder while gaming a "bailout" foolishly intended to try and prevent the pain.

 

Steve

 

 

You assume that capitalism is allowed to work freely. If it was, that CEO position wold allow all qualified applicants to bid for the position, or the board, would hire the person that's willing to take the job for the least amount of compensation, while still meeting the minimum requirements.

 

In reality, those that have the most to gain and the most infulence manipulate capitalim to fill their pockets, while fleecing everyone else who follows the rules. I know I got paid XXX amount in my job because if they offered any less, they would have had trouble finding a applicant that met all of their qualifications that was willing to relocate there.

 

But on the bottom-end of the scale, supply and demand is much more noticeable because those without little influence have no ability to manipulate the system. If your average joe pipefitter of electrican turns down $15/hour at a local factory, someone else will gladly take the position.

[smiller]

Had we not hamfistedly mettled with the market at the onset of this inevitable correction, we would have experienced a recession which would have been sharp and painful, but quick and just, unlike the years-long. anemic, unjust recession we're in right now. And, it would not have added a penny to our national debt.

I don't think anyone really knows if the first sentence is correct or not since unfortunately we don't have two identical economies to experiment with, one with which we 'meddle' and the other we let collapse and then see which turns out better in the long run. But with regard to the last sentence I believe that it is certainly incorrect to say that a collapse of the financial system and a resultant depression wouldn't increase the national debt, as clearly it would. In such a case there would have been an enormous hit to tax revenue while spending for social services would show a similar increase, and both effects would last for many years. Whether the net damage to the budget would be more or less than what we have now is another one of those thing we will probably never know (irrespective of the number of people on both sides who believe that they do.)

[Lawman]

I don't think anyone really knows if the first sentence is correct or not since unfortunately we don't have two identical economies to experiment with, one with which we 'meddle' and the other we let collapse and then see which turns out better in the long run.

 

And why do you assume there would have been a collapse? The only thing that would have collapsed would have been a bunch of bank bondholders..I've yet to hear a reasonable explanation as to why bondholders were kept whole at the expense of taxpayers..

Bankruptcies do not equate to collapsed economies..Remember how the world was gonna end if we allowed GMC to go bankrupt? Well after wasting taxpayers dollars it happened anyway and the world is still turning..

[smiller]

And why do you assume there would have been a collapse?

There isn't much doubt that credit markets would have frozen up and as a result a multitude of very, very bad things would happen, and there aren't many (non-partisan) economists who would dispute this. As above I don't think anyone can say how far the spiral might or might not have gone, the question at hand was simply whether to roll the dice.

 

But then again even if nothing was done it may not have been too bad for elected civil servants in Texas with high job security and a future government pension.

[Quinn]

The problem I have is that, when you're already paying someone 5.1 million, how do they work hard enough to earn another 1.1 mil? If I'm earning 60k a year, can I work hard enough to earn a 1.1 mil bonus? Every year? No matter how the company is doing?

 

 

[Lawman]

There isn't much doubt that credit markets would have frozen up

 

Banks got taxpayer money and still didn't lend it..Do you really think they've earned all they have already paid back to the government? If the banks were loaning out all this money why does the government own GMC and AIG?

 

There was more than enough bondholder debt that could have been wiped off the books if necessary to free up capital. My AIG bonds haven't missed a beat...That's just wrong..

 

BTW..The delinquent mortgage crisis still hasn't gone away...If something isn't done to restructure those mortgages another credit crisis looms in the very near future..

[steve.foote]

Seth, where do you get this illogical notion that millions of business owners would simply close up shop and walk away if the financial sector fell apart? These guys are survivors and are very good at solving difficult problems. Most of these entrepreneurs would have simply tightened their belts and adjusted their processes and products until the tough times passed - like they did during the great depression, and like they are doing right now. The way I see it, banks are a nothing more than a convenience for business. If they all died tomorrow, we'd just go back to bartering with each other like we used to.

[smiller]

Yes, in the event of a collapse we would undoubtedly have done as we did during the Great Depression and 'simply' do whatever what we had to in order to survive, and over the following decade we would no doubt recover. I just don't think that result was the preferable choice.

[steve.foote]

Yes, in the event of a collapse we would undoubtedly have done as we did during the Great Depression and 'simply' do whatever what we had to in order to survive, and over the following decade we would no doubt recover. I just don't think that result was the preferable choice.

 

Well, then what was the perferrable choice? Dumping trillions and trillions of dollars of additional debt on our kids? Come on, Seth, surely you don't believe the choice we embarked upon last year was consequence-free? Instead of our generation dealing with our problems head on, we cowardly decided to "kick the pain" down the road.

 

It doesn't matter how intellectually you try to argue it, we (the current generation) took a pass on this. We opted to not be responsible and deal with our own problems. Our irrational fear of failure is so great that we made a lot of very foolish mistakes and now those mistakes are becomming our legacy.

 

It looks like it will probably work out all right for us in the short term, but remember this, the kids get to pick out your retirement home.

[smiller]

Come on, Seth, surely you don't believe the choice we embarked upon last year was consequence-free?

Of course not, and surely you don't believe that the choice to do nothing would have been consequence-free? You seem to keep assuming that the option was between no expense and a large expense but I'm not sure why you would believe this, clearly a second Great Depression would have been enormously costly as well (and probably result in a legacy of new social programs of which I'm guessing you wouldn't be a big fan.) It's not clear which choice would have ultimately resulted in the greatest cost to the nation and the highest bill to the next generation. Maybe my retirement home will be nicer than yours.

[Lawman]

Maybe my retirement home will be nicer than yours.

 

Seth,

You'll probably be one of the fortunate few to get a waterfront view..

 

http://www.travelblog.org/Photos/267565.html

[yabadabapal]

Maybe my retirement home will be nicer than yours.

 

Seth,

You'll probably be one of the fortunate few to get a waterfront view..

 

http://www.travelblog.org/Photos/267565.html

 

Now thats what Im talking about. We can always dream.

[vizhip]

Maybe my retirement home will be nicer than yours.

 

Seth,

You'll probably be one of the fortunate few to get a waterfront view..

 

http://www.travelblog.org/Photos/267565.html

 

Now thats what Im talking about. We can always dream.

 

Knowing my luck... mine would leak...

 

Or based upon the rain we had in Georgia, flood...

 

As for consequences... there were going to be consequences no matter what was done, but using the government to bail out the private sector always costs more than if we let the private sector come up with a plan to resolve the issue...

 

The problem comes when you have those that want all they can get and are dishonest enough to try and hide until things are so bad it will take a lot to fix... and when the oversight committee gets lazy and doesn't do their job to catch issues... (most oversight committees are the board of directors and many of them will ignore what is going on if they see a lot of money coming their way)...

 

Don't ask me what the real solution should have been, but I think we took a shortcut that is going to come back and bite us rather than really come up with a resolution...

 

Regards -

-Bob

[Lawman]

Another 2.3 billion taxpayer dollars down the drain which only served to postpone what should have happended to begin with..Not to mention the benfits that would have been gained by keeping system integrity..

 

" Any deal with bondholders would likely wipe out most of the government's $2.3 billion bailout loan, according to the Journal."

 

 

http://finance.yahoo.com/news/Report-CIT-Group-again-on-apf-3494599188.html?x=0&sec=topStories&pos=3&asset=&ccode=