Whether it’s Merrill Lynch’s John Thain or Bank of America’s Ken Lewis or Citigroup or Bank of America or J.P. Morgan Chase; clearly, somebody is lying. Thain says that Bank of America knew about Merrill’s 15 billion dollar quarterly loss before B of A signed on the dotted line to acquire Merrill’s “Thundering Heard”. And, that it wasn’t his fault anyway; Thain offers that distinction to his predecessor and former Merrill CEO Stan O’Neal.
Bank of America claims that they were not aware of a round of bonus payments that were accelerated by a month (convenient considering it was the month before the deal went down, and even more convenient that the total amount of the bonus payments more-or-less equaled the amount of the fourth quarter loss) and Thain says not only did Lewis’ bank know about them; they approved them. The same B of A, Citigroup, and J.P. Morgan Chase all say that demand for loans is ebbing and that is why, even after receiving billions in TARP money, their loan percentages went down in the 4th quarter.
How can you tell if they are lying?
Pardon the stolen punchline, but the answer is their lips are moving.
Folks, for years now, I have been warning you that Wall Street is a cesspool. What you are witnessing now are people trying to protect themselves and their million dollar legacies with finger pointing, deception, and downright prevarications. It is ugly and it is going to get uglier. The really sad thing about all of this is that I don’t think that much comes of it.
We have grown immune to scandal and its various remedies. That is why the Governor of Illinois can sell a Senate seat; why a sitting United States senator can troll for sex in a bathroom stall; why a Congressman can flirt with minor pages; why the nominee for Treasury Secretary can have the fact that he did not pay his own taxes for 4 years and still get approved, ignored; and it is why a President of the United States can engage in oral sex with an intern in the oval office and serve out his term.
We are immune to shock.
For years now, I have been asking all of you, “Where is the outrage?” We are a nation of Nero’s fiddling while Rome burns. The question now becomes when will your outrage be ignited? I think the answer to that is when each of us starts to feel personal pain. That might come in the form of losing a business or losing a job. Then, it becomes personal. I am saddened that it has come to this, but I believe that it is necessary. You cannot remove 40 or 50 years of excess from personal financial, spiritual, and spending habits without a certain “shaking” of one’s foundation.
So, there we are. This is not going to be pleasant, but we will be triumphant as long as we keep our eyes on those things that are truly important. Hopefully, through these kinds of episodes, we now know that how much money you make, or what kind of car you drive, or what type of jeans you wear aren’t all that important after all.
At least, I hope so.
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Posted by Danny Fontana on January 26th, 2009
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