Wall Street's Simple Formula for Staying Rich
In a 1964 concurring opinion deciding Jacobellis v.
Using Potter’s indisputable logic, it’s hard not to see something obscene in how Wall Street reaped massive profits and bonuses in 2009 — and continues to do so, as is clear from Monday’s announcement by
How did this happen at the same time Main Street continues to suffer from an unemployment rate of almost 10 percent and from the worst
The benefits for Wall Street started with the extensive de-leveraging that continues the world over in the wake of the
The easiest and most profitable risk-adjusted trade available for the
And now for the truly obscene part. By keeping interest rates so stubbornly low — and by remaining committed to doing so — the Fed is crushing the rest of us, especially senior citizens on fixed incomes and those who have rediscovered saving in order to have some peace of mind.
For instance, despite my bank calling it a “premier platinum savings” account, I am getting a measly 0.15 percent interest rate. On my “premier platinum checking” account, the interest rate is 0.01 percent. In an essay in The
Our savings is another source of virtually free capital for banks to use to lend out at much higher rates. These anemic yields are a “potential disaster striking at core American principles of self-reliance, individual responsibility and fairness,” Mr. Schwab observed correctly.
Sure seems to be working for Wall Street, though. At $140 billion in compensation and benefits, the 2009 paychecks on Wall Street were the best ever. While several top executives named in public filings may have tried to minimize their 2009 compensation after so much populist rage, they could only take this charade so far.
Hedge fund managers did even better. The top 25 earned a total of $25.3 billion in 2009 — an average of $1 billion each — with the lowest paid hedge-fund manager receiving $350 million. Topping the list was David Tepper, of Appaloosa Management. He made $4 billion last year. “We bet on the country’s revival,” Mr. Tepper said in an interview with The Times.
Let’s be clear about one thing: The American people made a bigger bet on the country’s revival than did Mr. Tepper. But we are still waiting for our payoff. Surely Justice Stewart could see that the