Tuesday, October 07, 2008
Why CEOs Should Be Held Accountable
A friend of mine from Canada sent me the link to the following:
http://abcnews.go.com/Blotter/story?id=5973452&page=1
Less than a week after snagging 85 billion dollars from taxpayers they executives run off and spend a half million dollars on massages and manicures. The truth is AIG's executives and top people have been making unsound financial decisions for years that have led up to this. Tracy used to work for AIG until she and many others without warning lost their jobs. Though in the long run it worked out well for her at the time it couldn't have come at a worse time really. But she, like the majority of Americans, are middle class and are always the ones expected to pay for the mistakes. I told Tracy at the time that something was fishy because the biggest reason companies lay off people is to cover losses. Think about it, every time a company is losing money you read they lay off people. It's the quickest and surest way to cover losses. It took some time but eventually it came out AIG was covering losses. This link is to an article from 2005.
http://blog.kir.com/archives/001857.asp
"AIG, the largest insurance company in the U.S., admitted transactions that "appear to have been structured for the sole or primary purpose of accomplishing a desired accounting result." To make matters worse, state and federal investigators believe that the full extent of AIG's accounting improprieties over the past decade are even larger."
What is most interesting about this article is the author warns that AIG could suffer a financial meltdown and explains why - although he didn't think it would happen. Undoubtably he's thinking now he should have said he thought it WOULD happen. AIG isn't unique and unfortunantly this is probably common practice for the majority of corporations. Instead of being finacially responsible and save the money they prefer to get manicures and lay off people like Tracy when needed.
There are just three types of people. Rich, Middle Class, and Poor. George Carlin once said the poor people were there to scare the middle class into going to work every day. The rich need the middle class to be scared enough to go to work every day because that's where they get their riches from. Of course the self-imposed poor need us to go to work every day for them too. And by self imposed I mean those that choose to stay and benefit to the maximum from free support. Does it really matter anymore who I vote for?
http://abcnews.go.com/Blotter/story?id=5973452&page=1
Less than a week after snagging 85 billion dollars from taxpayers they executives run off and spend a half million dollars on massages and manicures. The truth is AIG's executives and top people have been making unsound financial decisions for years that have led up to this. Tracy used to work for AIG until she and many others without warning lost their jobs. Though in the long run it worked out well for her at the time it couldn't have come at a worse time really. But she, like the majority of Americans, are middle class and are always the ones expected to pay for the mistakes. I told Tracy at the time that something was fishy because the biggest reason companies lay off people is to cover losses. Think about it, every time a company is losing money you read they lay off people. It's the quickest and surest way to cover losses. It took some time but eventually it came out AIG was covering losses. This link is to an article from 2005.
http://blog.kir.com/archives/001857.asp
"AIG, the largest insurance company in the U.S., admitted transactions that "appear to have been structured for the sole or primary purpose of accomplishing a desired accounting result." To make matters worse, state and federal investigators believe that the full extent of AIG's accounting improprieties over the past decade are even larger."
What is most interesting about this article is the author warns that AIG could suffer a financial meltdown and explains why - although he didn't think it would happen. Undoubtably he's thinking now he should have said he thought it WOULD happen. AIG isn't unique and unfortunantly this is probably common practice for the majority of corporations. Instead of being finacially responsible and save the money they prefer to get manicures and lay off people like Tracy when needed.
There are just three types of people. Rich, Middle Class, and Poor. George Carlin once said the poor people were there to scare the middle class into going to work every day. The rich need the middle class to be scared enough to go to work every day because that's where they get their riches from. Of course the self-imposed poor need us to go to work every day for them too. And by self imposed I mean those that choose to stay and benefit to the maximum from free support. Does it really matter anymore who I vote for?
Friday, October 03, 2008
300 Billion Might Not Be Enough
News blurb with the header, "Low expectations for the homeowner-help program." The first paragraph:
"The federal government's new $300 billion Hope for Homeowners program opened for business today with the intent of staving off foreclosure for 400,000 homeowners in trouble. But we just have to wonder how effective it will be."
Have Americans become so used to seeing the billions of dollars people like Bill Gates have that they know longer have a concept of how much a billion dollars is? Even before reaching for the calculator my brain was saying, "that seems like a whole bunch o' money for each person." To save anyone else from reaching for a calculator (or any unnamed reader that hates math) this works out to $750,000 for each of the 400,000 homeowners.
So let's say it takes a quarter of a million dollars in expenses (politicians, all the bank people and CEOs that put us in this mess, and hiring someone to do the paperwork) for each home to process this that still leaves a half million dollars to help each of these homeowners with their mortgage they couldn't afford in the first place. So giving all these people twice as much as the median new home price might not be effective?
Once again Americans will trod in to the polling places like the cattle they are and pull the lever for "their party" but whichever party that is you can bet the only thing they think about you is that you're too stupid to operate a calculator.
"The federal government's new $300 billion Hope for Homeowners program opened for business today with the intent of staving off foreclosure for 400,000 homeowners in trouble. But we just have to wonder how effective it will be."
Have Americans become so used to seeing the billions of dollars people like Bill Gates have that they know longer have a concept of how much a billion dollars is? Even before reaching for the calculator my brain was saying, "that seems like a whole bunch o' money for each person." To save anyone else from reaching for a calculator (or any unnamed reader that hates math) this works out to $750,000 for each of the 400,000 homeowners.
So let's say it takes a quarter of a million dollars in expenses (politicians, all the bank people and CEOs that put us in this mess, and hiring someone to do the paperwork) for each home to process this that still leaves a half million dollars to help each of these homeowners with their mortgage they couldn't afford in the first place. So giving all these people twice as much as the median new home price might not be effective?
Once again Americans will trod in to the polling places like the cattle they are and pull the lever for "their party" but whichever party that is you can bet the only thing they think about you is that you're too stupid to operate a calculator.
Wednesday, October 01, 2008
Ever heard of Newsweek?
Even though Tracy was pushing me to vote for McCain I was leaning toward Nader again this year. After this: http://www.youtube.com/watch?v=xRkWebP2Q0Y I might have to vote for Obama. I realize Better Igloos and Snowbanks or Moose and Spear are her common reading materials and she couldn't use those - but she can't even name a national news magazine or newspaper? Dan Quayle wasn't exactly someone you wanted in the position of possibly being president over a death, but you figure the interns could have probably helped him through whatever time there was before the next election. If this woman gets there it is just going to be a total freaking nightmare. Did McCain or anyone actually ask this woman some questions before making her the VP nominee?
