Subject: Comments for File Number S7-12-11

May 27, 2011

Iím writing because my people were affected by the economic collapse of 2008, and we donít want it to happen again. I come from a family in which old-fashioned financial probity remains a living concept, and the scandalous pay practices of Wall Street executives nauseate me. Their "earned" income is earned in name only, not the fitting reward of sound management and conscientious work. The real value of their compensation packages is often hard to assess, particularly as they are free to hand themselves ridiculous bonuses, which often appear to be culled from the salaries of responsible administrative and customer service staff whose positions have been eliminated.

Wall Street greed and outrageous pay practices were a major cause of the collapse. There were vast rewards for stupid, irresponsible, destructive behavior. Bankers bankers paid themselves on the volume of loans (mortgages) they generated, not on the quality. It might help to change the incentives so the sociopaths in the executive suites donít collapse our economy again: e.g. delay the bonuses for several years, at least five or seven. That way, we would know if the loans made in year one remain good. That is by no means the only reform needed. A serious attempt to stabilize the economy would also consider caps on compensation, and modifications of the tax code to eliminate the advantages of obfuscating options and deferrals. But as a bare minimum, there ought to be a relationship between compensation and responsible management.

Thank you for considering my comment,

Katharine Rylaarsdam

Baltimore, MD