Disconnect

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Submitted by threadkiller on November 9, 2009 - 8:26am

Gold is going up along with the stock market, how long can this go on? Heard on Bloomberg the average bank bonus this year is $250,000 that's 5 times the national income average, what's up with that? I realize a lot of financial workers lost their jobs, but does this justify rewarding the remaining workers,probably CEO types?

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The disconnect is not what
Submitted by sdduuuude on November 9, 2009 - 12:04pm.

The disconnect is not what banks are "allowed" to pay their people. They should be allowed to pay them whatever they want to maintain profitability.

The disconnect is that they are not allowed to fail when they pay their people too much to do things that would (without bailout money) run the company into the ground.

Take away their safety net and watch the salaries dry up.

Exactly-- this is what
Submitted by PeteDude on November 10, 2009 - 11:08am.

Exactly-- this is what Buffett's trying to tell people: carrots and sticks. You need to have disincentives as well as incentives if you want to change business behavior.