Redline Doc

Mar 1, 2010 - 3 minute read - I never saw THAT coming

Bonuses for bettors

I’ve been quiet again. Probably feeling a deep recession myself, much more moral than fiscal but none the less, staying away from vocalizing what should be said.

I awoke to a story this morning about Jeffrey Skilling. His lawyers want to revisit the case so poor Jeffrey, who ruined the lives not only of stockholders, but his fellow employees by lying and taking their monies would be set free. But I digress.

I work in Hartford, now ranked the third poorest city of its size in the nation. Once it had a thriving downtown and people worked at department stores, in the pre-mall days, with names like G Fox and Company or Brown-Thompson and more. They probably never made much more than minimum wage but worked hard, many of them for 30 years or more and retired with small social security benefits but with a retirement plan that allowed them some leeway to visit grandchildren, keep an apartment or house and generally live a decent retired lifestyle. No high rollers here, just decent hardworking folks.

I spoke to one the other day, now on the verge of losing her house because she can’t make the tax payments. How? Well Jeffrey Skilling’s friends at Morgan Stanley and Lehman Brothers (and many others) took her monies to the racetrack, bet the monies on derrivatives (a fancy name for casino in the stock world). So long as everyone was making 100% returns (you do see where this is going) everyone was happy. Then the day came when someone looked and (((GASP!!!))) the emperor was naked. The whole house of cards fell and with it the retirements and savings of the folks in the North End of Hartford and elsewhere. Oh well. Not to despair. We’re so good (the Skilling-ites replied) that we need bonuses to make sure that we retain all these fine young minds. And so they did. We the people bonused the bettors. If they’d done this at a OTB window they could not have done a better job.

What of my lady in the North End. She, who worked all her life gets to go on assistance. She spoke with me with tears in her eyes.   She’d never taken anything from anyone and now she was forced to accept this.

I’m not the blood thirsty sort; however, I have visions of letting Jeffrey or his ilk, loose in a field with some of the folks they fleeced. Heads on pikes. It might slow the cascade of betting other peoples monies. It might bring some cold comfort to those without heat or shelter because they lent trust and were returned fiduciary irresponsibility.

I spoke with a 401K counselor recently about all this stealing. He of course in his snow-cones-salesman’s way assured me that this could never happen to mutual funds? Huh?

Somewhere out there I recall that fiduciary meant fiscally responsible. If we bonus these people perhaps they should pay (directly) some of those millions to those they fleeced.  An idea but hardly likely to fly. Nope. Heads on pikes I think.