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<p>I thought “The Smartest Guys in the Room” worked at Enron.</p>
<p>Greed. The belief that housing prices across the country would never go down together.</p>
<p>The belief that a person coulod always refinace his/her loan.</p>
<p>The belief that mathematical models work in the finance field in the same way they do in the science world.</p>
<p>Greed.</p>
<p>It’s the buyers and originators fault if they lie about what they are selling? Or trade a clients account against their wishes to generate commissions? No wonder Wall St is hated - they want to blame everyone but themselves.</p>
<p>The good news, Dstark, is you get to choose anyone you want to manage your money at whatever price is acceptable to you. If the fees are too high and no one comes to the party, they will get adjusted. Yet people keep paying for some reason…</p>
<p>BCEagle, with all due respect, find a good broker. There are lots of jokers out there but that is not a reflection on WS.</p>
<p>“Yet people keep paying for some reason…”</p>
<p>Ignorance. The public is misinformed.</p>
<p>The public doesn’t know that most experts aren’t experts. (This holds for other fields besides ws).</p>
<p>"There are lots of jokers out there but that is not a reflection on WS. "</p>
<p>Your statement is nonsensical.</p>
<p>Brokers are the face of Wall St.</p>
<p>Excuses, excuses, excuses. Someone else is to blame. The customer is at fault. Blah, blah, blah. No wonder Wall St is hated. The representatives of Wall St right here show enough arrogance to engender hatred.</p>
<p>"The belief that housing prices across the country would never go down together.</p>
<p>The belief that a person coulod always refinace his/her loan."</p>
<p>These represent failures of the buy side: the rating agencies and the credit processes of buyers. Whatever the degree to which the intermediaries were also culpable,
to me, it seems like there must have been abject negligence on the part of these parties. To a degree that I never saw when I worked in this field. That part is mind-boggling to me.
This should not happen, within the framework established.</p>
<p>There has always been greed, but there nevertheless used to be credit processes. And these were not controlled by the intermediaries.</p>
<p>“The belief that mathematical models work in the finance field in the same way they do in the science world.”</p>
<p>Maybe this is part of the problem as well. You’d think after Long Term credit there would have been some adjustment there.</p>
<p>BTW, I don’t work on wall street.</p>
<p>"Maybe this is part of the problem as well. You’d think after Long Term credit there would have been some adjustment there. "</p>
<p>All goes back to a selling job. Someone sold a lot of really smart guys running university endowments a lot of crap at the wrong time. Perhaps Wall St did a good job at selling mathematical models. If they didn’t work, well, someone else would clean up the mess.</p>
<p>The notion that all these brilliant financial types will quit and go elsewhere, since there might be imposed paycaps for those firms taking bailout funds? Let’s see where they are in such hot demand.</p>
<p>
[quote]
So the r</p>
<p>“It’s the buyers and originators fault if they lie about what they are selling? Or trade a clients account against their wishes to generate commissions? No wonder Wall St is hated - they want to blame everyone but themselves”</p>
<p>If a guy in the construction business swindles me and doesn’t use the materials promised in building my house, then maybe I ought to sue him, and pursue remedies, including legal. That guy is a bad guy. that doesn’t mean the whole construction industry is corrupt, or everyone in it should go flogging themselves, and accept personal culpability thrown at them by others for the action of this guy.</p>
<p>Allmusic, your post did not completely assuage my concerns.</p>
<p>"Banking executives and recruiters say talented financiers — the driven, hyper-numerate, slightly ruthless ones with a preternatural knack for making money in bull markets and bear — are always in high demand. "</p>
<p>These are precisely the ones who would be impacted by the salary cap, and could go elsewhere.</p>
<p>If not immediately, then eventually.</p>
<p>“Perhaps Wall St did a good job at selling mathematical models. If they didn’t work, well, someone else would clean up the mess”</p>
<p>They were likely using the models for themselves, not selling them.</p>
<p>Wow, just wow. The OP got his answer. Folks in NH think their brokers are “the face of Wall Street” and the nonsense in the NYT is taken as fact by Main Street.</p>
<p>“That guy is a bad guy. that doesn’t mean the whole construction industry is corrupt, or everyone in it should go flogging themselves, and accept personal culpability thrown at them by others for the action of this guy.”</p>
<p>If it happens in the construction business or in engineering, then people worry about going to jail or getting fined and paying large amounts of money. All of the engineering programs that I’ve looked at have required ethics courses. Is the same true for Wall St workers?</p>
<p>Part of the problem with Wall St’s image is that there are bad apples and they get away with what they do and they throw it in your face.</p>
<p>There was a scandal in NY recently about inspectors overseeing construction projects. I recall a number of crane accidents where people died. So you throw the guilty people in jail. They didn’t get huge bonuses by their employers. Does it taint their profession? Sure. That’s why you punish the perps - so that others don’t do the same thing and so that it’s understood that such behavior won’t be tolerated.</p>
<p>“Wow, just wow. The OP got his answer. Folks in NH think their brokers are “the face of Wall Street” and the nonsense in the NYT is taken as fact by Main Street.”</p>
<p>Which representative of Wall St does the average person have the most contact with?</p>
<p>Who is the face of the White House?</p>
<p>Who is the face of the Senate?</p>
<p>Please use common sense.</p>
<p>The OP’s question was about salaries and bonuses, the thing Main Street is outraged about at present. This does not involve brokers. Apples and oranges. Brokers are not investment bankers.</p>
<p>But I will say that how you look at this is exactly the point, people in general have no idea how WS works which is at the root of the anger, so it’s understandable.</p>
<p>“If it happens in the construction business or in engineering, then people worry about going to jail or getting fined and paying large amounts of money. All of the engineering programs that I’ve looked at have required ethics courses. Is the same true for Wall St workers?”</p>
<p>Yes Wall street workers ought to reasonably be concerned about being punished for misconduct. Just offhand I recall several prominent insider trading cases where workers were prosecuted. I even recall a case where one of them committed suicide rather than do jail time. I actually saw that guy during his trial, I was serving jury duty.</p>
<p>Securities industry workers have to take a big test to get licensed, and I believe there are sections on it related to ethics.</p>
<p>I actually do not recall any required ethics courses as part of my engineering education.</p>
<p>“The OP’s question was about salaries and bonuses”</p>
<p>The OP’s question was specifically not about salaries and bonuses.</p>
<p>“Main Street is outraged about at present”</p>
<p>Main St is outraged at a lot of things right now.</p>
<p>“This does not involve brokers. Apples and oranges. Brokers are not investment bankers.”</p>
<p>Please show me where the OP is not about brokers. Here’s the question again:</p>
<p>“What do you see as the biggest wedge dividing Mainstreet and Wall Street? The exorbitant salaries and bonuses aside, what is it about Wall Street that has made it this country’s biggest scapegoat?”</p>
<p>Businesses used to be conducted for the purpose of making money by providing goods and services for people and other entities (other businesses and governments) and getting paid for said goods and services.</p>
<p>Wall Street would bid up the price of the stock of successful businesses and shareholders could sell at a profit. That was good. Lots of companies paid dividends and that was good. Good dividend performance would drive stock prices higher.</p>
<p>Then certain business management types discovered they could perform actions which were not in the best interests of the long term viability of the business but would generate a short term jump in stock price.They stole bonuses by artificially “juicing” the stock price. Other managers, seeing their “success”, jumped on the bandwagon. Soon most business was conducted, not to provide goods and services, but to artifically inflate stock prices by impressing or even deceiving Wall Street. Wall Street “went along with the scam” to get their own unearned bonuses.</p>
<p>Outsourcing, one of the key stock juicing strategies, moves production to lower wage areas where the workers are inferior consumers. They make less so they buy less. The net amount of economic activity in the world decreases.</p>
<p>We are living through the failure of the modern American business model.</p>
<p>A society which cannot provide good jobs for its citizens needs to be changed or replaced.</p>