Flutterby™! : The End of the Financial World as We Know It

Way worth reading: Michael Lewis: The End of the Financial World as We Know It.

Richard Fuld, the former chief executive of Lehman Brothers, E. Stanley O’Neal, the former chief executive of Merrill Lynch, and Charles O. Prince III, Citigroup’s chief executive, may have paid themselves humongous sums of money at the end of each year, as a result of the bond market bonanza. But if any one of them had set himself up as a whistleblower — had stood up and said “this business is irresponsible and we are not going to participate in it” — he would probably have been fired. ...

Part 2 continues into exploring the fuck-up that is the Paulson management of the TARP payoff bailout, and also details several ways in which the SEC is the problem, not the solution. Both are well worth reading.

Semi-relatedly, there's some concern that the U.S. savings rate will skyrocket, and though raising the savings rate is good, if it skyrockets the economy will slump dramatically. Seems to me that the smarter thing to do with that $750 billion, if you believe in government intervention in the economy, would have been to put it solidly behind Social Security, so that we didn't have the "oh holy crap my retirement's disappeared" reaction, and then work to phase out 401k and IRA plans, or find a way to shift them so that they're not just a way for the Wall Street slimeballs and shysters to get their fingers further into the pockets of the rest of the country. I'm not sure how that happens, beyond abolishing the things entirely (which has a negative impact on the savings rate too), but encouraging local smaller investment would both help to cut out the broker culture, and build more vibrant communities.