Sunday, May 24, 2009

Giving back capital

Constantly in the news here is the push from the banks to return government investments - the TARP funds - to escape from the strings that were attached to that money - specifically, the limits on executive compensation.

This is being discussed as if it were the most natural thing in the world - of course bankers want to be paid more! The question of how returning cheap capital benefits the shareholders (obviously, it does not) - ostensibly, the owners of these enterpirses - is never even mentioned.

It's a really weird concept of capitalism that we have here!

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