The Fourteenth Banker Blog

April 30, 2010

The End of Innocence

Filed under: Running Commentary — thefourteenthbanker @ 10:45 PM

Financial reform is not free for the same reason it is necessary.  This Zero Hedge post makes it clear that Wall Street is sending warning signals.  The world did not get in its present condition by the collective responsible, conservative, ethical and wise actions of all players in government and the financial markets.  It got in its present condition by too many power brokers being just the opposite for too long.  We’ve had a huge financial market unwind and rewind.  The extent of the rewind is based on rosy assumptions that we can simply return to normal with the passage of a little time.  But I do not know that Shiva is done.  In the best possible scenario there will be shifts in global and financial power.  When you add a reform effort to the mix there will be winners and losers.  We really need the winners and losers of the last decade to change seats.  If the wealthy and the powerful would volunteer to be losers for awhile, and let citizens win, we may eventually get prosperity in this land again.

The author predicts that next week might be like the Titanic sequel, implying there is a sort of Fate to reckon with. Perhaps.  I do not agree with the argument I read elsewhere that somehow we have to prop up the big six banks in order to hold up the world.  How absurd is that?  (unless you mean the other kind of “hold up”)  The big six banks are going to change.    The question is whether they will go kicking, screaming, scratching out for themselves every last dime, or whether they will put the interests of the world and its citizens in front of their own interests?   If the big six act for themselves  only, we are in for a wild ride.  The vultures will pick at their bones.

On the other hand, if these CEOs will rise to the level of statesman, I believe they can find an orderly way to restructure which does not disrupt the entire economy.  Rather than playing the Dick Fuld, they should play Lord Mountbatten and oversee the most orderly transfer of sovereignty possible under the circumstances.    That requires a release of wealth and power and giving it over to the democratic process.   In doing so they may salvage a Commonwealth out of an Empire.

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5 Comments »

  1. Yeah, really! I get sick if hearing from middle level managers at my bank how bad it would be for the economy if this financial reform bill breaks us up. And I feel like screaming, you mean how bad it’ll be for you guys and your sick self serving agendas. No Shiz!

    I saw several small business owners this week and just when they badly need credit they have no place to turn to. If they only need less than half a million dollars no one wants to mess with such a piddly loan! I’m told every day, don’t waste your time on UNBANKABLE prospects, some of these folks have run their companies longer than I have been alive!!!! They are not unbankable, unless you’re a lazy lender who does not want to spend five minutes understanding how they do their business.

    No sir, the ones who’ve captured the power will not give it up voluntarily. Not a single CEO of any of these big six has come out on their own to face the public? Why not? Wasn’t the American tax payer their true saviour when they needed it the most. But most ( including the CEO of my bank) have made statements that they didn’t really need it ( Blankfien was adamant about that in his testimony). That right there should tell you that if repentance or taking the high road is what you’re expecting, this bunch WILL NOT deliver that.

    I can’t wait to see them go down kicking and screaming.

    Comment by Vocalbanker — April 30, 2010 @ 11:20 PM | Reply

  2. The continued cluelessness and hubris from the banking sector is becoming darkly comic. If the cluelessness exhibited last Tuesday is any indication (and I trust that it is) the banksters are in a parallel universe.

    The Senators, for all their blustering, convoluted foibles, still have to stand for elections. This is not a complicated set of factors at work.

    I think you’ve sussed out the dynamics splendidly.
    The baffling absence of statesmanship in High Finance bodes for some very well fed vultures over the longer term.

    Comment by readerOfTeaLeaves — May 1, 2010 @ 11:18 PM | Reply

  3. I share your wishful thinking on the Statesman part. More likely a kicking and screaming 5 yr. old tantrum will ensue. But … throughout this mess I’ve always thought that all you need is ONE CEO to take the high road for the rest to follow. The first would end-up rocketing their stock px by looking like the White Knight of Wall St. Then, of course, the rest would have to sheepishly follow. Can’t find a Joe Kennedy in the house though…

    Comment by Lucy Honeychurch — May 4, 2010 @ 6:09 AM | Reply

  4. I love this blog, thank you for taking the time to write each day. By any chance were you listening to a Don Henley song when you wrote this particular entry?

    Comment by 15th Banker — May 8, 2010 @ 2:30 AM | Reply

    • I was not listening but that is where the name came from. I love your 15th banker moniker by the way.

      Comment by thefourteenthbanker — May 8, 2010 @ 1:11 PM | Reply


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