Goldman Sachs Banker bonus cartoon

Goldman Sachs Banker bonus cartoon

Big Bad Banker’s Bonus Bonanza

A fundamental part of capitalism is how risk, effort and reward work together. At its best it encourages innovation, keeps the market on its toes through competition and delivers enormous value for those who put in the effort. At its worst, it promotes greed and inappropriate risk-taking with other people’s money.

Financial institutions are the primary cause of the current global economic meltdown. By intervening to save banks on the brink of collapse, governments have removed one of the strongest feedback mechanisms that keeps capitalism in check – failure. Sure, governments could not just stand by and watch bank after bank collapse – particularly retail banks. That would have had far reaching consequences. The public would have likely lost faith in the banking system and very fundamentals of global economics risked being shaken. Bailing out the banks without a very hefty penalty though is a serious mistake. Governments have effectively signalled that it is ok for banks to take risks in the interests of profit without real consequences. Clearly, the controversial topic of fatcat banker bonuses just a year after government rescue is evidence of this.

What governments should have done is formally nationalised some the failing banks, re-branded them as state entities, fixed them up as best possible and then sold them off later. The failed banks and their bankers would have got what they deserved and the integrity of capitalism left intact.

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Comments

  1. I hate them, not because they are banks as such, but because they all pretend that they are helping us, but in reality are taking us for a ride because they know we can’t function without them. I truly believe that when the sun is shining they give you an unbrella, but as soon as it starts raining they take it back. When they had a chance the governments should have given them a good snotklap!

  2. This situation is really ridiculous – bankers should be punished! The profits they are now earning are on the back of government subsidies in terms of cheap funding – they should not be entitled to reward themselves until taxpayer burden is eased off!

  3. Government, banks, Eskom – they are all a rotten lot. Keep your money under your matress, pay cash and demand a discount and barter where you can.

  4. This is how it works ….. In this day and age of “DIY” banking we the public do most of the work when it comes to banking and then get charged heftily for the ‘privilege’. The Government fat cats collect the huge amount of taxes generated by our efforts – from the banks. Aside from everything else – it is not prudent for the government to neglect banks in trouble. Where would all that extra cash come from to line their pockets. But thats not even Capitalism – it’s highway robbery – big companies robbing us the little people so as to stay in favour with the power of the day. Nothings changed – and we are becoming more and more like our corrupt american and english friends.

  5. Imagine if a system could be desvised where taxpayers decide where their money goes

  6. The fat cats will get fatter and people will drive faster. See the correletion??? You do what you can whether in the board room or cabinet.

  7. Yha theypretend, but gues what they are willing to kill u,with a hug heart attack, look nwthe reporate was a bit up from compared to last year. Its cleae I said it before that they are theones causing the global economic melt down, llok nw recession, but how erxactly do they make it, I just wonder.

    The matter of government intervening is not going to me ke things easier, but rather is going tomess things nd leave people hurt economically, tyhe only way I think government can do is to increas the money supply, every time. Reduce the tax, even reduce the huge amount spent on prisoners.
    Stop the high salaries, nd stop spoiling the ministers like this, Nyanda was bought a new car, very expensive, they make things worse.

  8. I agree 101% with Tanni’s comment.
    Further, internet banking for the minimum effort, the rest is cash when I actually visit the shops. Credit cards are useful only for foreign transactions.
    The banks charge me to put my money into my account and then charge me to withdraw my cash from my account, over and above the servic charge. They have legislation to back them up. Just try starting a bank of your own and watch the big brothers come down on ypo

  9. Leonecole says:

    It’s the name of the game: make as much as you can, in as short a time as possible, with as little risk as possible and function just inside the law. That’s capitalism. Does it have a heart? No! But does any other system have a heart? No! When it’s about money, all sympathy goes out the window. So, don’t blame them, play the game and play to win!

  10. They expect you to pay your loans back, at premium interest rates no less, and institute legal action against you resulting (not causing, hopefully) in you losing your property; yet when they FAIL they expect you to bail them out; no charge, and with costs.

    They operate on the principle of greed not capitalism; whch like communism sounds great on paper, thanks.

  11. One more thing, a poll should not be a noose, thanks.

  12. Not like our ministers who think that taxpayers money is theirs and they don’t have to do anything to earn it

  13. I had a very astute friend in the 1960’s who said that the bank only lent money to a person who did not need it. If you were desperate, with no assets or property, the bank would not lend money to you. Bank Managers had “nose” and were able to lend money to customers who had prospects. In the 1990’s I was working as a Pension Fund Manager for a large company. My boss asked me to attend a seminar on “futures” as he was unable to do so. I listened to the presentation and reported back that, even though I have a modicum of intelligence, I could not understand what the purpose of the investments was, as it appeared to me to be a gamble. Sugar futures did not mean that you would own the commodity. At no stage would tonnes of sugar be delivered to you! If you gambled for an increase in the price, you may or may not strike it lucky! Hedge funds, too, seemed a futile investment. Of course, the more activity there was on the different exchanges, the more commission was being earned. In the United States they had NINJA mortgages (No Income No Job or Assets). No self-respecting banker would be involved in these mortgages, considering that the money they are lending are deposits held on behalf of customers. They have a fiduciary responsibility towards their customers. Politicians are quick to promise a house to every voter. If they use taxpayers money, they may still be able to justify their actions. But they try to force banks to lend money to people who simply cannot repay the debt. We need to go back to old-fashioned values. Hard work, thrift and moderation.

  14. Pity we can’t lodge a criminal charge with the police against Eskom asnd banks. After all, princes of darkness and bankers are nothing but parasitic thugs in suits. If not for the monetary system of the world, they could be hunted down like the dogs they are and dealt with apropriately.

  15. guess we should boycott all banks for a few months,maybe they would take us serious when we dont give them our hard earned monies.then they will know who really their bosses are same goes to goverment.

  16. Capitalism is healthy even if is not fair on others but it teaches one to have a good game plan in this money driven world.

  17. Don’t forget that FNB gave the ANC the biggest “GIFT” a couple mof years ago to help this useless ANC get into power. It looks like a “GIFT” but was in fact an investment in their own future! At the moment banks in this country get thye highest fees for their services in the world and this corrupt useless ANC government won’t move a finger to protect the poor from being robbed by FNB!
    ANC supporters and FNB directors, put this in you pipes and smoke it!

  18. I overheard Sam Shilowa say over SAFM Radio over the weekend that the “Zuma Government has spent R600 000 to open up new Departments/Ministries.” His comment was about President Zuma’s promise of jobs during his campaign.
    Something must be wrong with his Mathematics or something. Wonder why COPE can count on him. Thats dangerous. I am glad I am not COPE. I am okay as a Security Guard.

  19. Pietsnor,

    The bankers own this corrupt ANC government – that is the reason why the Bankers helped this useless corrupt ANC get into power in the first place. No matter how much you hate the so called “unfair apartheid regime”; but this kind of blatant robbery of the poor never happened with them in power and that’s why the bankers wanted them out!

  20. Africa, foolish Africa, when will you learn? You believe you are FREE now….but now you are being robbed from all sides, business as well as government as well as your criminal neibour, yes, even your Taxi driver! KRY VIR JULLE! JULLE WOU DIT MOS GEHAD HET!

  21. I wonder where this “Dirk” (excuse my French) Muller banks his lousy money. I wouldnt be surprised if he hides it under his pit latrine since he hates Bankers because they support a just cause and progressive movement. People like him should be sent to pay Mugabe a visit and never come back to a civilized society.

  22. Leonecole says:

    How did the discussion get sidetracked, namely from Capitalism to Bankers? Yes, bankers are capitalists, but are they the only capitalists? And can a modern system function without banks? Is your favourite supermarket capitalist? How about your corner cafe? How about a spaza? A shebeen? The question is: is capitalism right, or is it wrong and why? Let’s hear some creative answers.

  23. Walter

    I use Capitec bank to save as that is the only bank where you still get some interest…the others also pay intrest yes, but their fees are so high that your balance keep shrinking!

    If you think FNB supported a good course , you must be corrupt yourself to call the useless corrupt ANC a good course!

    There is NOT ONE THING the ANC did well except stealing the poeples money! There is NOT ONE GOV DEPARTMENT that function the way it should – so wjat the hell is good about that?

  24. What the hell is wrong with you? saying:

    “How did the discussion get sidetracked, namely from Capitalism to Bankers? ”

    This discussion never was about capitalism…it is about bankers all the way….but seeing that you asked, communism can never work in lazy africa specially not in a country everybody understand and do things back to front!

    If Russia could ‘nt get communism to work, lazy africa does not even stand a chance at all!

  25. Sorry, my previous comment was in answer of the comment made by:

    Leonecole
    November 2nd, 2009 at 6:33 pm

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