Will Romney be the last GOP holdout against breaking up the banks?
There’s a lot of thinking on the right these days that the banks need to be brought under control. The very conservative Dallas Fed called for breaking up the big banks this past spring. The Arkansas financier Warren A. Stephens said the same thing on the Wall Street Journal’s very conservative op-ed page around the same time. So did James Pethokoukos of the almost pathologically conservative American Enterprise Institute, also in theWeekly Standard. And so did Arnold Kling of the libertarian Cato Institute in National Review. All these conservatives have turned up, on this issue, in bed with a gaggle of thinkers on the left: Katrina vanden Heuvel, Robert Reich, Sherrod Brown, Bernie Sanders … I could go on.
You heard similar talk about breaking up the big banks during the early primary season from Jon Huntsman, but you aren’t hearing anything remotely like it from most conservative politicians, most especially not from Mitt Romney or Republican leaders in Congress.
Timothy Noah — "Campaign Advice That Mitt Won’t Take"
Why does Wall Street have such a fraught relationship with Chuck Schumer?
"In the ongoing melodrama between Democrats and Wall Street, few characters are more compelling than Chuck Schumer. New York’s senior senator has a well-cultivated reputation as the financial world’s top wing man in Washington, at least among Democrats. But since he also hopes to lead his august chamber one day, he’s charted a more ecumenical path of late. That, of course, hasn’t exactly endeared him to the lords of finance, and so much pathos has ensued.”
- Noam Scheiber, “The Ballad of Chuck Schumer”
The hedge fund world loved Obama in 2008—and now it viscerally despises him. What caused the big split?
TNR Senior Editor Alec MacGillis explains why hedge fund honchos turned against Obama in the cover story of The New Republic’s latest issue, on newsstands now.
"Four years later, that bond is broken. The hedge fund community has overwhelmingly shifted its backing to the Republicans: Mitt Romney has so far outraised Obama by a four-to-one ratio among hedge fund employees, pulling in more than $500,000—not to mention the seven-figure checks his super PAC has received from several top fund managers."
— Alec MacGillis, “The Big Split: Why Hedge Fund Honchos Turned Against Obama”
How did CEO pay spin so far out of control?
"The astronomical sums commanded by CEOs are the culmination of a decades long trend. In 1980, the average ratio between CEO salary and the median salary of a worker was 40 to 1. In 2010, it was 325 to 1. Among the top 50 corporations in the United States, the most extreme pay ratio, according to the compensation data firm Payscale.com, is 1,737 to 1. That salary belongs to Stephen Hemsley, the UnitedHealth Group CEO, who received nearly $102 million last year, compared with the median employee salary of $58,700."
-Nell Minow, “Executive Decisions"
Wall Street fat cats are bracing themselves for smaller 2011 bonuses.
In the industry, a bonus — often up to half of all compensation — is referred to as a worker’s “number.” And the numbers this year are supposed to be about 20 percent to 30 percent lower than they were last year, according to Johnson Associates, a consultancy that helps some of the industry’s biggest players divvy up their payouts.
Morgan Stanley has gone so far as to cap cash bonuses this year at $125,000 per employee
Is the Democratic love affair with Wall Street over?
Today, Jon Corzine, a former Goldman Sachs CEO, Democratic senator, and Democratic governor, testified before the House Agriculture committee about the collapse of MF Global and the disappearance of $1.2 billion in customer funds.
For more, read Timothy Noah’s blog post on what MF Global’s collapse means for the future of Democrats’ already tenuous relationship with Wall Street.
Photo courtesy of CNN Money.
Rajat Gupta, the highest-ranking corporate executive to become embroiled in a push by the government to root out insider trading, pleaded not guilty Wednesday to charges of leaking confidential information while serving as a director at Goldman Sachs Group Inc. and Procter & Gamble Co, the Wall Street Journal reports today.
Gupta follows in the footsteps of Raj Rajaratnam, the former Galleon executive sentenced earlier this year to 11 years in prison for orchestrating one of America’s biggest insider trading scams.
Read Daniel Krauthammer’s piece on how “Margin Call,” a new movie featuring Kevin Spacey as a Wall Street executive, gets the financial industry right.
Also, keep an eye out for TNR’s next issue, featuring an explosive cover story on swindles.
Photo courtesy of IBNLive.