Geithner Calls for ‘Very Substantial’ Change in Wall Street Pay

-- Treasury Secretary Timothy Geithner called for an overhaul of compensation practices at [private] financial companies and said the Obama administration’s plan to help realign pay with performance will be rolled out by mid-June.

“I don’t think we can go back to the way it was ... We’re going to need to see very, very substantial change.”

He said that Wall Street’s pay practices encouraged taking on short-term risk, and helped precipitate the financial crisis. What’s needed is a set of broad standards that federal regulators can use to make sure that doesn’t happen again...

[Chilling: they're talking about government regulating the pay practices of private business - and later in the piece, rules that will have the government "police risk".

Credit markets are in the business, globally competitive business, of managing risk. Does anyone really think the government will do a better job than private sector professional actuaries?

The only way to get an answer other than 'of course not', is to buy into the first misdirection on which their canard is based that it was the current pay practices that 'helped precipitate' the crisis.

They likely had a minor role, but one which pales in comparison to the government's interference in mortgage lending that was the primary progenitor and what truly caused the first and largest domino to fall.

And once the government successfully sets its 'pay for performance' standards in the financial sector, can any (every) other sector be far behind? {think: health care}.

This is dread, it should be refused.]


READ MORE