the subprime debacle is a mess. we all know that now. what ideally was a great investment vehicle, turned sour really hard and fast, with many lives financially ruined as a result. if you don’t know what subprime is by now, the long and short of it is simply about houses being bought by people who can’t afford them, mortgaged by firms that never bothered to do proper credit and liquidity checks on the home owners. these firms then sold off these securities to investors packaged as consolidated debt obligations (fancy for saying lots of different types of debts rolled into one) to improve their cash flow. these investors in turn receive a consistent flow of money. everyone makes money, everyone wins, so long as housing prices keep going up. well the housing market burst, and the initial home owner couldn’t afford their monthly payments and everything goes down hill from there. basically, it’s like investing in a box. someone offers you this box, has no idea what's in it, but assures you that it will make you money. so you buy it, but little do you know, there’s a ticking time bomb in that box.
now where is the accountability? people are hurt, people are angry, and people have lost their life savings. some are now looking towards people like james cayne, who is the chairman and former chief exectuve of bear stearns. bear stearns was, up until a week ago, one of the largest global investment banks and securities trading and brokerage firms in the world. cayne’s stake in bear stearns was 1 billion. seemingly overnight, it collapsed to 14 million at the price jp morgan chase offered as a buyout to the insolvent bank last sunday as a result of their involvement in the subprime crisis.
now, please stop the tears. don’t cry for cayne, because between 2004 and 2006, he was paid about $40 million in cash, as well as stocks and options. bear stearns was neck deep in these highly lucrative, but risky subprime securites, which helped drive profits and share prices. this investment practice has caused the collapse of this 80 year old firm, one of the biggest financial collapses in recent years.
should cayne be held accountable? he did, after all, stear the ship straight into the iceberg. but will he be held accountable? no. because the bailout is already under way, and the government cannot have this collapse echo into the rest of the market, even though it already seems to have done its damage. so while you have people now homeless and others without their life savings, you have men like cayne walking away with millions. literally millions. these men take enormous risks all for the bottom line, and when things go wrong, they retire somewhere on some island with hooker maids and midget butlers (i'm not too positive about that last bit of info, but i've heard stories...) seriously, if i did my job even half as poorly as cayne did, i would never be licensed again by anyone. ever.
cayne is but one example of many who have walked away from their shitty job performances with millions. now is this fair? no. but it’s the way things are. until there is real accountability for these actions, nothing is going to change. honestly, i don't think "risk" has any meaning to these people. i think the saying is, “the rich get richer by ass raping everyone.” i think confucius said that. go to wikipedia. i’m sure it’s in there somewhere.
now where is the accountability? people are hurt, people are angry, and people have lost their life savings. some are now looking towards people like james cayne, who is the chairman and former chief exectuve of bear stearns. bear stearns was, up until a week ago, one of the largest global investment banks and securities trading and brokerage firms in the world. cayne’s stake in bear stearns was 1 billion. seemingly overnight, it collapsed to 14 million at the price jp morgan chase offered as a buyout to the insolvent bank last sunday as a result of their involvement in the subprime crisis.
now, please stop the tears. don’t cry for cayne, because between 2004 and 2006, he was paid about $40 million in cash, as well as stocks and options. bear stearns was neck deep in these highly lucrative, but risky subprime securites, which helped drive profits and share prices. this investment practice has caused the collapse of this 80 year old firm, one of the biggest financial collapses in recent years.
should cayne be held accountable? he did, after all, stear the ship straight into the iceberg. but will he be held accountable? no. because the bailout is already under way, and the government cannot have this collapse echo into the rest of the market, even though it already seems to have done its damage. so while you have people now homeless and others without their life savings, you have men like cayne walking away with millions. literally millions. these men take enormous risks all for the bottom line, and when things go wrong, they retire somewhere on some island with hooker maids and midget butlers (i'm not too positive about that last bit of info, but i've heard stories...) seriously, if i did my job even half as poorly as cayne did, i would never be licensed again by anyone. ever.
cayne is but one example of many who have walked away from their shitty job performances with millions. now is this fair? no. but it’s the way things are. until there is real accountability for these actions, nothing is going to change. honestly, i don't think "risk" has any meaning to these people. i think the saying is, “the rich get richer by ass raping everyone.” i think confucius said that. go to wikipedia. i’m sure it’s in there somewhere.
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