Comments on: The Number is Anti-American http://www.consumerismcommentary.com/2006/01/24/the-number-is-anti-american/ A premiere personal finance blog, established 2003. Within, Flexo discusses his own experiences with money, and he and other authors comment on a wide range of personal finance topics. Sat, 21 Nov 2009 16:42:00 -0500 http://wordpress.org/?v=2.8.5 hourly 1 By: retireat30 http://www.consumerismcommentary.com/2006/01/24/the-number-is-anti-american/#comment-1651 retireat30 Thu, 26 Jan 2006 11:35:11 +0000 http://wp.consumerismcommentary.com/?p=808#comment-1651 I agree with the problem of influence brokers. They shouldn't exist because they distort the political process (although if memory serves, Locke thought that money in politics was both inevitable and in the end OK). However, I do take some exception with the other two points. 1) Wall street is not the stock market. They do thousands of tasks in the big investment banks, and only a fraction of them involve the stock market. They also manage bonds, underwrite stocks and bonds, in short perform the transactions that keep all financial markets (not just the S&P 500) working. 2) Sure many executives make millions of dollars a year, and certainly many of them are overcompensated, but not necessarily all of them. CEOs are generally very talented and capable people. If they were to 'go it alone' and leave the helms of their publicly traded companies I imagine they would, on the average, do better as owner-managers than they do as just managers. The downside would be that some of them would get filthy filthy rich and some would get filthy poor - I think it is a much more likely that they are accepting security over average higher pay (like bonds vs. stocks - one is more secure, the other is better on the average). I agree with the problem of influence brokers. They shouldn’t exist because they distort the political process (although if memory serves, Locke thought that money in politics was both inevitable and in the end OK).

However, I do take some exception with the other two points.

1) Wall street is not the stock market. They do thousands of tasks in the big investment banks, and only a fraction of them involve the stock market. They also manage bonds, underwrite stocks and bonds, in short perform the transactions that keep all financial markets (not just the S&P 500) working.

2) Sure many executives make millions of dollars a year, and certainly many of them are overcompensated, but not necessarily all of them. CEOs are generally very talented and capable people. If they were to ‘go it alone’ and leave the helms of their publicly traded companies I imagine they would, on the average, do better as owner-managers than they do as just managers. The downside would be that some of them would get filthy filthy rich and some would get filthy poor – I think it is a much more likely that they are accepting security over average higher pay (like bonds vs. stocks – one is more secure, the other is better on the average).

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