May 26, 2011
I live in a neighborhood that has been quite negatively impacted by the economic collapse of 2008, and also have several close friends who have been unemployed now for a long while (one almost 2 years, the other getting close to one year).
It's very clear that we, as a society, have to take some preventive actions to ensure that we don't face a similar situation in the next few years. Being an 'older person,' I well remember my father talking about the changes that the FDR Administration made to prevent another 1929 and I studied about such in school as well; and those laws worked....until we began to tinker with them.
One factor in the 2008 collapse were the incentives that the 'system' provided. Americans always talk about how we need to 'incentivize' work (vs. 'welfare' etc.) Well, let's apply the same principles to Wall Street.
One way to change the incentives so Wall Street doesn’t collapse our economy again would be for regulators to set up a way for shareholders to grab back ill-gotten gains.
If it turns out that the profits in a given year were built on shoddy practices that become clear in the out-years, those bonus payments should be forfeited.
Thank you for considering my comment,
Rivko Knox
Phoenix, AZ