{"id":801,"date":"2009-03-04T17:26:16","date_gmt":"2009-03-05T01:26:16","guid":{"rendered":"http:\/\/hodakvalue.com\/blog\/?p=801"},"modified":"2009-07-25T18:08:33","modified_gmt":"2009-07-26T02:08:33","slug":"business-porn-2","status":"publish","type":"post","link":"http:\/\/hodakvalue.com\/blog\/business-porn-2\/","title":{"rendered":"Business porn – Pt. 2"},"content":{"rendered":"

The big report today on the cover of the W$J<\/a> and Reuter’s<\/a> feed was that Merrill’s top ten paid executives earned $209 million for 2008.<\/p>\n

The story (Version 1 – Wall Street Journal):\u00a0 2008 was a horrible year for nearly everyone; big banks like Merrill were responsible; they would have failed, but they got bailed out by us (taxpayers); their top executives, far from suffering like the rest of us, made millions, or tens of millions (from us!).\u00a0 But the NY AG is investigating the bonuses, so they may be made to pay for their greed.\u00a0 The moral of the story?\u00a0 Greed is alive and well on Wall Street, and we’re getting taken advantage of, except that our valiant public servants may set things straight.<\/p>\n

The un-story (Version 2, teased from the same set of facts): Merrill was on the edge, with part of the bank plunging into the deep, largely as a result of bad decisions.\u00a0 Other parts of the bank had to pull that much harder to keep the whole firm from going all the way under.\u00a0 Several of those parts, including investment banking, global-rates, fixed-income, currencies and commodities were profitable, largely as a result of good decisions.\u00a0 The good part kept the firm afloat. \u00a0 So, while average pay across the firm took a huge dive (and many people lost their jobs), the pay in the relatively good divisions was only down between 3 and 9 percent.\u00a0 The NY AG, posturing for the press, demands gobs of information about the bonuses, threatening to divulge competitively sensitive information, based on a theory of public harm so tenuous that the press doesn’t even bother to articulate it.\u00a0 The moral of this story?\u00a0 If you save your company, your grateful bosses will take care of you, even when the rest of the world is screaming for blood.<\/p>\n

The second rendition is clearly the inferior story.\u00a0 It doesn’t excite populist passions, or trade on outrage, envy, or resentment.\u00a0 It doesn’t reinforce the lie that we’re all the same, equally worthy of other’s riches, and that the only thing that prevents us from re-entering Eden is are those unrepentant sinners.<\/p>\n

Last year, Larry Ribstein claimed that the new disclosure rules for executive compensation served no real purpose other than mass media titillation–what he referred to as porn for the business pages<\/a>.\u00a0 I am more convinced than ever he was right.<\/p>\n

UPDATE<\/strong>:\u00a0 It looks like Andrew Cuomo read the same article, and issued subpoenas to the seven people named<\/a> in it:<\/p>\n

“We want the executives to testify under oath in our office about their work, the size of the bonus pool, the timing of the payments, their individual bonus and interaction with Mr Thain,” said the person familiar with the probe.<\/p><\/blockquote>\n

Once again, no mention whatsoever–not one word–about what Andy is fishing for in this testimony, as if that doesn’t matter at all.\u00a0 No mention of what Andy will actually get from this bullsh*t distraction, other than free publicity for his run for governor.\u00a0 Charges?\u00a0 There will be none.\u00a0 If there are, there will be no case.\u00a0 If there is, there will be no convictions.\u00a0 This is pure political theater.<\/p>\n","protected":false},"excerpt":{"rendered":"

The big report today on the cover of the W$J and Reuter’s feed was that Merrill’s top ten paid executives earned $209 million for 2008. The story (Version 1 – Wall Street Journal):\u00a0 2008 was a horrible year for nearly everyone; big banks like Merrill were responsible; they would have failed, but they got bailed […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,14],"tags":[],"class_list":["post-801","post","type-post","status-publish","format-standard","hentry","category-executive-compensation","category-scandal"],"_links":{"self":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/comments?post=801"}],"version-history":[{"count":11,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/801\/revisions"}],"predecessor-version":[{"id":1641,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/posts\/801\/revisions\/1641"}],"wp:attachment":[{"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/media?parent=801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/categories?post=801"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/hodakvalue.com\/blog\/wp-json\/wp\/v2\/tags?post=801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}