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Time for a pop quiz
What was the last great innovation in the financial industry? Raise your hand. Yes, you in the back corner, Mr. Paul Volcker, former chairman of the Federal Reserve. What's your answer?
He holds up a photo:
That's right, Volcker believes the banking industry reached its peak when it invented the ATM in the 1960's. More from Seeking Alpha:
"It really helps people, it's useful."
This, as opposed to what was broadly considered to be "innovation" by his successor at the central bank in the form of derivative products such as collateralized debt obligations and credit default swaps that "took us right to the brink of disaster."
He also called for the return of Glass-Steagall, a move that would again separate commercial banking from investment banking, and criticized compensation plans that had become too generous...
Volcker was speaking at the Future of Finance Initiative and apparently left the stage to "thunderous applause."
Meanwhile, economist Paul Krugman's in love with Alastair Darling... specifically his proposal to tax banker bonuses in Britain by 50%. Krugman says:
Are we afraid that the best and the brightest will leave high finance and pursue other occupations? That strikes me as a good thing: everything we know suggests that the rapid growth in finance since 1980 has largely been a matter of rent-seeking, rather than true productivity.
This is a sure-fire argument starter. There are those who would say Wall Street's money-churning exercises create value for companies and allow them to conduct and increase their business. Goldman Sachs CEO Lloyd Blankfein calls it "God's work."
But if anyone in this whole situation sounds remotely close to godly, it would be Volcker.
As I've said before, the government and Wall Street need to put him in front of the class and listen.
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it would be Volcker.
As I’ve said before, the government and Wall Street
"
Was Chairman Volcker the hapless victim of Alzheimer's Demise as the taxpayer's dinghy was riding in the wake of Volcker's Titanic? Was The Late President's Alzheimer's Disease the prime mover for pushing Greenly to the front of the regatta as Super-Paul was dumped overboard?
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Surprise! Omnipotent government is manipulated by frail human minds, human minds that should think more but manipulate less, innovate less, skim off less from working Americans, pour less damaging sodium silicate into the engines of our economy, and keep their wandering hands to themselves.
Take your hand out of my pockets, Weirdrdrdos.
The only innovations that ever come out of the financial industry are simply ever more elaborate (and unfortunately effective) ways to make themselves richer at the expense of average Americans. They called many derivitives like credit default swaps innovations when they were first created, and only now do we realize how nasty their innovations can be. When they "innovate" they are really just inventing new atomic bombs that will go of in the American economy in the future. And all the problems we Americans suffer at their hands (like how many are now unable to retire because their pentions got invested with institutions that bought into exotic financial products) are all so some executive at Goldman Sachs can waterski behind a different yacht during each of their semi-annual trips to Barbados. They get bailouts, we get the bill. I am not a socialist, and there is nothing wrong with making money, but when you do it at the expense of the general welfare of millions of people... it is an outright crime against humanity.
I thought the last great innovation in banking was when most of the banks decided to treat customers with deposits of under $500,000 like lepers so they could focus instead on kissing up to the big-business and invetsment-banking crowd. When I was a teller in the mid-'80s we had to smile and personally greet every person who came to our window, whether it was Daddy Warbucks or the pumpkin farmer from Bumpkinville. I got so tired of dealing with crabby/snobbish/hostile tellers at my local banks -- not to mention the scores of mystery fees they assessed on my accounts -- that I transferred my money to a nearby credit union. If you don't have beaucoup bucks sitting in the vault, chances are your bank doesn't want you setting foot in the lobby. They have ATMS for "people like you."
