Ward on Words

Front page of the Wall Street Journal today had two stories that offer a vivid picture of where we are today as a nation. The first story , above the fold, tells the story of the fee bonanza Wall Street firms are experiencing, thanks to the work involved on the AIG breakup. The lawyers and bankers on the job "could collect nearly $1 billion for IPOs and advice..." The second story , below the fold, talks about how the "tide" has turned for Proctor & Gamble, with the company reporting an 18 percent loss in 4th quarter profits. The loss is attributed to the fact that "sales of their premium-priced brands shrank amid tightened consumer budgets." So in some stores, P&G has launched "Tide Basic" - a cheaper version of their popular laundry detergent "that the company freely admits isn't 'new and improved'" and lacks some of the capabilities of the full-strength product. According to the WSJ: "It's ver...

Execs at "too-big-too-fail" AIG got fat bonuses this week, despite the fact that their company has in reality failed and would be out of business were it not for a massive infusion of federal (tax) money. And people on Wall Street and in Washington seem caught off-guard by the populist outrage spawned by these bonuses. The legal obligation claimed by Tim Geithner to use tax dollars to pay large sums of money to failed execs has apparently enraged large numbers of people who live outside of NY and the Beltway. They simply do not understand why, at a time when the economy is in the toilet and millions of people have lost their jobs, the people who played a role in the collapse of the economy are being rewarded with millions of dollars in bonuses. And it is puzzling. We keep hearing that bonuses for performance are an integral part of how Wall Street does business. These struggling firms need to pay large sums of money to "the best and brightest" in order to re...

He was dead. He was worse than dead. He was ruined. Ruined by greed, by ego, by lust. I'm referring to former Governor Eliot Spitzer, who resigned in disgrace after it was revealed he invested thousands of dollars on an industry - prostitution - that he had sought to shut down. And now he's back - bringing us a message from the dead about the scandal known as AIG. In an op-ed piece appearing in Slate, Spitzer warns that the $165 million in bonuses paid to AIG execs is not what we should be protesting right now. His issue is with the fact that the recipients of TARP funded AIG payouts are the same banks who've capitalized nicely from TARP investments - the investments made by the government to protect those firms from the fact that AIG would not be able to make such payments. It is a circular flow of money that is at first confusing. But if true, we've sent out nearly a trillion dollars so that firms like Goldman Sachs could get twice the money out of thei...