The American economy remains in dire straits, with one worker in six unemployed or underemployed. Yet Goldman Sachs just reported record quarterly profits — and it’s preparing to hand out huge bonuses, comparable to what it was paying before the crisis. What does this contrast tell us?
First, it tells us that Goldman is very good at what it does. Unfortunately, what it does is bad for America.
Second, it shows that Wall Street’s bad habits — above all, the system of compensation that helped cause the financial crisis — have not gone away.
Third, it shows that by rescuing the financial system without reforming it, Washington has done nothing to protect us from a new crisis, and, in fact, has made another crisis more likely.
Cassandra Needs To Shut the Hell Up
Obama's failure to even address the underlying causes of the recent shock to the global economy, and his giving ear to the parasites who benefitted, is already looking like the biggest failure of his first term.
The window of opportunity for real reform on Wall Street is slamming shut.