FCIC releases its financial crisis report
The Financial Crisis Inquiry Commission Report.
TEXT OF STORY
STEVE CHIOTAKIS: It's 545 pages. The report from the Financial Crisis Inquiry Commission hits the Internet and bookstores today.
Marketplace's Alisa Roth is with us live from New York to talk about what's in it. Good morning, Alisa.
ALISA ROTH: Good morning.
CHIOTAKIS: We've all talked a lot about the crisis obviously. What's new in this report?
ROTH: Well, the book talks a lot about how much people get paid. On the one hand, there's the fact that the regulators had trouble recruiting finance people to work for them. Because -- news flash here -- Wall Street pays so much better than the government. The other issue, though is the idea that the way pay was structured actually encouraged people on Wall Street to take really big risks.
I talked to Andrew Oringer this morning. He works on compensation issues at the law firm Ropes and Gray:
ANDREW ORINGER: There is a concern that the incentives in the compensation system did not align the interests of institutions with the interests of the individuals.
In other words, the person making the deal would still get paid, even if he or she were putting the bank at risk.
CHIOTAKIS: So will this report actually have any effect?
ROTH: In terms of legislation, a lot of that was already passed with the financial reform bill. But a lot of how it will actually work in real life still needs to be figured out.
I talked to Matt Slaughter this morning. He's associate dean of the Tuck School of Business at Dartmouth. He says it's things like:
MATT SLAUGHTER: What data are going to be monitored by the financial companies, how particular aspects of the law will actually be implemented and what that will mean for the practice of the individual firms and the overall financial system.
And for all those issues, it'll be really useful to understand what caused the crisis.
CHIOTAKIS: Marketplace's Alisa Roth, reporting from snowy New York this morning. Thanks.
ROTH: You're welcome.