Wednesday, March 18, 2009

Wall Street

I am a big believer in capitalism, but some people (especially on Wall Street) don't seem to get it. Bonuses are for outstanding performance, not for cutting your share price by 90% over a 6 month period. Read what Jack Welch wrote in "Straight from the Gut" about the cultural problems when GE bought a large brokerage house (I think it was Kidder Peabody). They handed out huge bonuses during good times, and were "required" to do the same in bad times to "keep talent motivated". Eventually Welch realized his mistake, cut his losses and sold them off.


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