Boy are you naive. No taxpayer could take out a loan without a source for that loan. I never hear of a taxpayer holding a gun to these banks. You are clearly showing your Wall Street Youth by your comments.
Companies and the people in them who take money from the government when they would otherwise be going out of business are commie - unpatriotic - un-American! The heads of those companies are like Leonid Brezhnev or Nikita Khrushchev living fat when they should be on their asses on the street. There are soldiers fighting and dying defending America and what America stands for - and it is NOT commie!
So, screw everyone else we come first and everyone else can get paid later. Funny how its this whole industry that does nothing but screw people out of their money. If you ask me all those analysts, engineers, and quant fks aren't worth shit and are just trying to justify their salaries. The management scum bags, even worse. As far as main street is concerned they can all burn in hell because all mainstreet got from wallstreet for the last 10+ years is one ass reaming after another.
Many of the companies that have been the victims of naked shorting should never had access to the capital markets. Just as home apprasals were inflated so were the IPo business model.
The best thing to do is to start over.... Why ? The personal computer has changed everything for what was once upon a time Wall Street.....the legitimate birthplace of capitalism.... One can relate to this by noting the following prospective near term future...... ................................................................ I walk into my trading room to start the session..... Looking at the screens on the wall, I see London is reacting somewhat to the Asian markets.... So I look at the news streams from Bloomberg...... Now I note stocks on the move....and prepare myself to start the session..... When I place my order ....I can elect 1x.2x.3x.4x margin shares at 10 cents per 100 share cost.... After the US session......I exercise, eat, love my family....and check to see what is happening in the Asian markets......interesting movement...so I decide to trade the Asian market today....in the exact same way and cost as the US market.... Then I note London has some interesting action....Then I trade the European market the exact same way that I trade the US market.... All with the same universal account ........I have an account with an LLP in Hong Kong because of better costs and leverage....whose computer banks are also in Hong Kong.... I travel the world....and my computer programs reside with a home base computer company which implements my programs, which I can also use manually....The company is utilized because of its computer power, speed, and low monthly cost.... When I want to know facts/news about a company , I simply type in the symbols on companies like FinViz which exists on an advertising model...which has zero monthly costs..... My charting/monitoring/account programs are housed with my Hong Kong LLC....My Hong Kong account manager informs me that it also is going to provide the computer facilities for my logic programs, at a very low cost....Hong Kong became the market center because the legal and other costs became too high and inefficient in the US because of political inefficiencies....The US does not object because it wants companies to provide jobs in the US.... All is well........ .............................................................................. The new business model would be those companies that would be bringing companies public to the exchange on a boiler plate basis.....The cost of entry would be negligible because there are boiler plate requirements which are easy to follow.....After listing, the company provides the wiki-stock-reporter with the boiler plate financial information..... The stock exchange police inspect the boiler plate entries and make sure that companies properly comply...... Accounting is very simply because the method is boiler plate, and is standardized throughout the world. Also there are no longer margin accounts per se, but 1x.2x.3x.4x shares at the individuals choice.... Also the costs are the same for all participants, 20 cents per 100 shares.....There is no account maximum or minimum......However there is a share maximum per security because of the market size of each security.... All securities trade in the same format.......Stocks, bonds, indices, currency, and commodities ......defined by symbols.....all are the same, and made availble in the language of choice.... ............................................................................... Also....there are also management units that trade on the exchanges which one could buy as shares.....the management units are described in the approved management roster and I can go to Wiki-Stock Managers to review what the management units use as logic, along with the performance history....All managers have been approved by the securities police.....The management units used to be called hedge funds or mutual funds....
Wall Street firms are leading by example, and the example is to abandon responsibility. Just like factories in China that have produced toxic products in toys and food, Wall Street has produced assets that are labeled "toxic". Perhaps some of those companies in China will survive with government assistance. Do they deserve to survive? One could argue that, since they created the toxic products, they would know best how to deal with them and should be helped to continue. Or you could argue that they deserve to be put out of business. Better, smarter, more honest companies may rise in their place, making for a better business environment and sustainable growth. But for the "state-enhanced" companies, they can leave the same well-connected "leadership" in place - and their guidance for those companies as a whole will have no incentive to change, being protected from their own mistakes. Then Wall Street becomes Socialism Street - and no amount of crying about some mortgage holder walking away from his obligations will hold any weight.
And many should have, deserved to be public, but were raped. So, what's your point? It seems to me, if you have a point, it is that licensed underwriters scammed the investing public for their funds, and then drove weak companies, financed by the public, out of business.
What exactly are you trying to say? That companies that were victims of naked short-selling did not deserve access to the capital markets this is equal to saying that a victim you was murdered should have never had life in the first place. As far as the inflated prices of IPO's are concerned, most of it is based on the current market expectations, when you as business/stock owners go and buy a business/stock it is your responsibility to do your own due diligence, reduce your expectations and weigh all pros-and-cons before you invest cause if anything happens to go wrong (which is and should be an expected event in any business at any point of time) you run screaming scam. The actual point is you are perhaps more to blame then some of the fund managers with bad money management cause most of you crying people definitely have far worse risk and money management skills, and do not even believe in accepting your own mistakes. A classic case of displacement. As far as being in-sync with this topic of this thread is concerned. Two of the three firms that are being scrutinized have not made any significant losses, and the profits were more than losses hence are net profitable in this period. Furthermore, at least one of these did not even want any part of the bailout and were quite literally forced to be a part of it. As far as picking up the bad assets of most of these institutions is concerned most losses apart from the initial blowup of the couple of hedge funds was is in the form of mark-to-market accounting rules. All accountants would most probably agree that in accounting assets are always priced at the value of purchase and not at market value as(if) you do not sell an asset there is absolutely no point in counting a loss/profit. On the mark-to-market theory these bad assets are eventually going to reap profits, perhaps at the peak of which the whole mark-to-market business will be removed. Thus making this so called spending of your tax dollars one of the wisest investments ever made on behalf on most of you. Add the interest that will be generated on the money given by or against the choice of institutions to them, and it becomes even sweeter. Btw did I leave out the preferred shares? A far as bonuses are concerned most people here perhaps do not even know the terms on which bonuses are paid out in the industry. As far as I am aware most of it is a legal obligation. Btw. does anybody have any idea as to the amount of profits GS may have accumulated on their proprietary positions this year, actually lets make it simpler, on their short positions on crude alone. What ever it maybe they will definitely give a large bonus on that one, and I for one am all for it Cheers!!
That companies that were victims of naked short-selling did not deserve access to the capital markets ------------------------ At least with a public company, naked shorting is a vehicle to put a company out of business or hinder it, not true with a private company. Probably any one reading has dealt with or heard of a company that operates on the fringe of the law and shouldn't be in business but continues on with complaints and lawsuits. Why don't companies with naked short issues go private? Why do they continue to use market tatics (dividends, etc) to circumvent their failed management, product, etc? There's private money for good business with no distractions of manipulation.
The reason is because "bonuses" aren't always just performance bonuses. They are guaranteed as part of the package at the end of the year. So, for a low level employee, he may make 80k and then have a 20k guaranteed bonus. Not everyone is a hot shot executive. They break it down this way to minimize turn-over. So the total "bonus" payout isn't really performance related payout. Second, the bonus is compenstation given to workers for the fact that they can't trade their own portfolios individually without severe restrictions. For example, some employees are forced by their employer to hold positions for 30 days at a minimum to avoid issues with insider trading, etc. This alone cuts employee's earnings potential because they cannot aggressively make the sort of side income regular Americans can by managing a portfolio actively. ... As for why the big guys at the top get bonuses? Good question. I've never been a big enough guy to know all the details.