'Men of the Mind' to go on Strike - Atlas Shrugged

Discussion in 'Wall St. News' started by Tide31, Mar 22, 2009.

  1. That's hilarious. You obviously do not have much experience with investors. Most angel investors HATE Wall Street. And most self-made wealthy individuals avoid dealing with Wall Street, especially if they went through its ranks. In certain emerging industries, they shy away from any Wall Street type.

    The real joke is that you actually called this economy "advanced" & "rich". Is the illusion still that hard to see through? Don't worry, in a few years, you won't have a choice.

    The whole system is hijacked by credit & the "money changers". Maybe, just maybe, that's the reason you see banks being so vital in the process.
     
    #41     Mar 23, 2009
  2. Tide31

    Tide31

    This was more my point of this thread. There are two sides and I don't think both sides are being heard today. People such as Dick Armey on CNBC today are saying they are frightened to death for capitalism with massive government and redistribution of weath. Obama on 60 minutes last night said something about bankers going to Arkasas and seeing what people make there at fast food places. This is frightening.

    All the big derivative traders and their books and all the prop traders on Wall St. are gone. So is 70-80% of Goldman's juice from these revenues. Whether it was right or wrong to promote these traders books is now irrelevant. What you have left are the plain vanilla bankers, salesmen and traders along with commercial bankers. They are being punished for their former colleagues misdeeds. If you have a group of a trader an assistant and two salesman that bring in $25mm in revenue because of their talent and network of relationships, they need to get paid. Supposing it's $2mm, $150k, $1mm and $1mm respectively. Throw in another $3mm in costs for space, computers, back office, research dept, etc... Thats a business with a 70% operating margin. There are no interest charges for this business which used to be 90% of Goldmans annual 'costs' with old business model. If you say that the trader cannot make that much money, then he will leave. His replacements with no experience and no contacts will make a fraction of this as will the bottom line of the bank. Why does ARod make$23mm/yr? Because its a different model which is substantiated by the bottom line.

    Obama, Congress et. al. don't see this. The power in the old line model these banks have all gone back to is being pulled out from under them. The 'product' that these banks offer, their 'franchise', is the talent of it's people, whether it is an investment banker, salesman, or trader.
     
    #42     Mar 23, 2009
  3. Tide31

    Tide31


    Forget the bitch that wrote the book, are we truly free in a society where there is forced equality and control in acquiring material possessions and resources?

    Is innovation a bad thing? Did voters really envision marxist theory being our utopian solution?
     
    #43     Mar 23, 2009
  4. I'm somewhat sympathetic to your viewpoint, but I think the anger is over huge bonuses being paid to people in firms that were bailed out by the taxpayers. No bailout, no company, no bonus. That is pretty straighforward, and ordinary people cna easily see it.

    As for the supposed value added by financial sector employees, I have to agree with Doug Kass that it tends to be wildly overstated. Most of it is the result of using the company's balance sheet, its order flow or its name to attract business. The individual bankers tend to be pretty replaceable. We need only look at the serial blowups by their hedge funds and the fact that most needed bailouts to see the truth of this. The compensation structure at these firms is a disgrace, considering they are publicly held companies. If they want to remain private, fine, send all the profits out the door as compensation and I have no complaints. When you go public, your duty is not to the employees but to the shareholders. It's doubly ironic that firms that specialize in corp finance thumbed their noses at this elementary concept.
     
    #44     Mar 23, 2009
  5. Agreed.
     
    #45     Mar 23, 2009
  6. Tide31

    Tide31

    Actually none of this will matter. One of the reasons for Friday's selloff in the banks was that it is widely expected that they will race to do secondaries to pay down the TARP funds and be done with the goverment. Today's rally is playing right into their hands. Not that the Senate will pass or Obama will sign Barney Frank's bill, but why take the chance.

    GS only needs to raise $4bil to get under the $5bil limit. Expected headline: "GS 40mm Share Spot Secondary". One days volume, and they for one are done with it.
     
    #46     Mar 23, 2009
  7. Tide31

    Tide31

    Sorry, I was wrong a little while ago. Looks like they'll just do this:


    (MarketWatch) -- GS
    Last: 110.90 +13.58 +13.95%
    4:59pm 03/23/2009

    Goldman Sachs is considering selling a part of its 4.9% stake in Industrial & Commercial Bank of China to raise funds, the Wall Street Journal reported in its online edition Monday, citing people familiar with the matter. Goldman is likely to use proceeds from the sale to repay some of the $10 billion in capital it received from the U.S. government last year, the newspaper said.
     
    #47     Mar 23, 2009