Morgenson -- A Reflection

(c) 2009 F. Bruce Abel

How do you regulate "too big to fail?"
How do you regulate a man's hand as it signs a "bespoke" contract committing billions to another?
Or that same hand cliking "ok" on a similar transaction, electronically?

Simon Johnson and many others say "Don't pay the man a commission for going to the casino and winning, for God's sake, without taking the commission away when he loses." Why pay him a commission or salary at all? Don't go to the casino!

But the former is not enough because questionable gate-keepers are telling us what "winning" is.

For example how many years did AIG have deferred "concepts" listed as assets on the balance sheet supposedly supporting its bets? (Post-retirement health benefits tax credits usable only if the company still existed. Timing differences on deferred accounting for accelerated depreciation.")