Results 1 to 3 of 3

Thread: Creative solutions to the credit crunch

  1. #1
    Site Caretaker Dave A's Avatar
    Join Date
    May 2006
    Location
    Durban, South Africa
    Posts
    22,648
    Thanks
    3,304
    Thanked 2,676 Times in 2,257 Posts
    Blog Entries
    12

    Creative solutions to the credit crunch

    It seems clear the global credit crisis is pretty serious. There are two things that really need to be talked about:
    • How to recover and get things back on track
    • How to prevent it happening again (or at least not as severely).

    So far governments have pretty much thrown money at the problem. Opinion seems divided as to whether that's any kind of a solution, let alone a band-aid.

    Perhaps what we need is a bit more of stuff like this:
    The Obama administration plans to limit pay to $500 000 a year for executives of government-assisted financial institutions in a new get-tough approach to bankers and Wall Street, a senior administration official said.

    Obama plans to announce the new limits with Treasury Secretary Timothy Geithner at the White House on Wednesday.

    "If the taxpayers are helping you, then you've got certain responsibilities to not be living high on the hog," United States President Barack Obama said in an interview with NBC Nightly News.
    full story from M&G here
    There could be more on the way, according to an unamed official reported in the same story:
    The administration will also propose long-term compensation restrictions even for companies that do not receive government assistance, the official said.

    The proposals include: requiring top executives at financial institutions to hold stock for several years before they can cash-out; requiring that pay plans be submitted for nonbinding shareholder resolutions; and a Treasury-sponsored conference on a long-term overhaul of executive compensation.
    Of course, such proposals are not going to be without resistance:
    Compensation experts in the private sector have warned that such an intrusion into the internal decisions of financial institutions could discourage participation in the rescue programme and slow down the financial sector's recovery. They also argue that it could set a precedent for government regulation that undermined performance-based pay.
    Hmm. I reckon there needs to be some form of moderating influence in all of this. It's the lack of moderation that got us into this mess.

    What do you think, and do you have any creative suggestions?

  2. #2
    Moderator IanF's Avatar
    Join Date
    Dec 2007
    Location
    Jhb
    Posts
    2,679
    Thanks
    197
    Thanked 529 Times in 405 Posts
    No suggestion but here is a worrying quote from Karl Marx in 1867.
    Owners of capital will stimulate working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable.
    The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and State will have to take the road which will eventually lead to communism.
    I got this in this morning from a financial advisor. Is Karl Marx Nostrodamus, scary.
    Only stress when you can change the outcome!

  3. #3
    just me duncan drennan's Avatar
    Join Date
    Jun 2006
    Location
    Cape Town
    Posts
    2,642
    Thanks
    119
    Thanked 94 Times in 77 Posts
    $500000 a year to run a company so well that it needs financial assistance from the government.
    [SIGPIC]Engineer Simplicity[/SIGPIC]
    Turn ideas into products | The Art of Engineering blog

Similar Threads

  1. Your credit record: free annual report
    By Eugene in forum National Credit Act Forum
    Replies: 27
    Last Post: 08-Nov-10, 12:32 PM
  2. The credit crunch and Africa
    By Dave A in forum Business Finance Forum
    Replies: 1
    Last Post: 19-Jan-09, 11:14 AM
  3. debtors application forms
    By BUSHBABY in forum General Regulatory Compliance Forum
    Replies: 6
    Last Post: 17-Oct-07, 05:02 PM
  4. HOW THE NCA CAME ABOUT
    By Eugene in forum National Credit Act Forum
    Replies: 0
    Last Post: 22-Jun-07, 09:57 AM
  5. Credit act could be good for those who have been blacklisted
    By Eugene in forum National Credit Act Forum
    Replies: 1
    Last Post: 25-May-07, 05:22 PM

Tags for this Thread

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •