The Asia Sentinel pointed me to a long, but very insightful and sobering article about the background causes, from some insiders’ viewpoint, of the US financial turmoil. The author of the article entitled “The End” is none other than the famed Michael Lewis, author of bestselling books like Liar’s Poker and The New New Thing, who incidentally is also one of my favorite authors. Before taking up his writing career, he had worked for Salomon Brothers in the 1980s, which job prompted him to write Liar’s Poker, a book that exposed the darker side of Wall Street two decades ago.
From the Sentinel:
I think Lewis hit the nail on the head when he said the problem with Wall Street is with the system of incentives that channeled the greed. I’ve read somewhere that on average each Goldman Sachs staff earned US$600,000 last year. And at AIG Financial Products in London, where the head count was 377, each staff on average used to earn more than US$1 million a year before the bailout. It goes without saying that the most obscene compensation packages went to the CEOs.
Obscene? Criminally so. I’ll never see that much money ever. When I was 24, I was beginning a long slow slide to the financial bottom, that I spent the last decade crawling out of. Even at that, its pretty much guaranteed, short of winning the lottery, I will never, ever, see that much money. Neither will most other normal people. This kind of thing is one reason I can’t side with the people who passionately defend such salaries as being in the country’s best interests.
One big lesson that the last decade taught me, is that its not how much money you make-its how little you spend. I lived a pretty nice life in Asia for relatively little money. Now back in the land of the free and the home of the brave-not so much. Every time I turn around its always something.
It does show though that the money is out there to jump start the world for the rest of us-if it can be pried from their greedy little fingers. I’m not holding my breath waiting for that.