Nationalize U.S. banks: Bob Rubin — give our $110 million back

rubinInteresting post from James Saft’s Reuters blog.

Saft interviewed Nissam Nicholas Taleb, author of the Black Swan at the World Economic Forum in Davos, Switzerland.

Taleb wants banks nationalized and forced to become a zero risk utility. He argues that they should never be allowed again to take the risks they took that resulted in the current economic crisis:

They rigged the game. We pay them for their profits, there is no clawback so their incentive is to hide the risk they are taking.”

“Which is why eventually as someone who loves free markets,  a total nationalisation of the part of the business that requires insurance and does clearing and payments needs to happen.”

“I am angry with U.S. policy. What we had is exactly the opposite of socialism, they got TARP to pay their bonuses and to take more risk.”

And he goes further. He wants banking executives [see Robert Rubin above] to give the bonuses back that they stripped out just as their banks tanked.

…he wants Bob Rubin, who trousered millions while chairman of Citigroup, to cough up.

“I want Bob Rubin to return his $110 million dollars to the American taxpayer.”

Taleb insists (Facebook: Make Bankers Accountable- A “J’accuse”) that capitalism must produce pain but the powerful should not be exempt from the outcomes of their behaviours.

3 Responses to Nationalize U.S. banks: Bob Rubin — give our $110 million back

  1. Carol Cross says:

    Maureen Dowd wrote recently that there should be disgorgement of the profits realized by the CEO bankers in the form of the big BONUS, but what about the BIG law firms who have the influence to promulgate the laws and the regulations and who make the somewhat “unregulated” and “troubled” securitization schemes possible and legal? Didn’t they pull in billions of dollars as well?

    What about the rating agencies who were only too happy to compete with each other to give high credit ratings to somewhat dubious securitizations that would fall into trouble when black swans arrived?

    Obviously, Treasury Law is made by those who go back and forth from the Government to Wall Street and, unfortunately, only those within the financial industry have the expertise to work for government. Bob Rubin is a good example.

    Unfortunately, many of the fat cats have taken their profits and have run into the safety of the law. The American people will pay the price for their faith that somebody was watching the store for them. The common people in the global economies, where BIG money works together to maximize profits, are sacrificed to the machinations of global financing and investing that necessarily sometimes works negatively against the nation’s economy and its working people.

    No easy answers and President Obama has inherited a terrible mess and there is no “silver bullet” in sight. He has the same problem that any President has —-he has to try to draw on the expertise of the insiders in the industries that need to be regulated and he has to rely on his wisdom and independence to recognize what is good or bad advice. He then has to reach his conclusions and then produce a consensus in the Congress of the United States. Therein lies the problem. The Republicans appear to be thinking about the election four years from now instead of the current dire state of our ecomomy.


  2. Editor says:

    The difference between socialism and capitalism? Under socialism, banks are first nationalized and then go bankrupt. In the capitalist system it appears to work the other way around.



  3. Carol Cross says:

    Yes! the Capitalists have been knocking socialism and criticizing socialist programs that benefit the people (like social security/ medicare/worker’s comp, etc.) as being bad fiscal policy for many years —under the Republican flag.

    Interesting! how the capitalists become socialists overnight and have their hands stretched out to government. I think Taleb, as referenced above, makes good sense, and those who were instrumental in creating this mess in the financial markets should be held accountable –after they are rescued, of course!

    Wouldn’t it be wonderful if some of those big law firms who made billions of dollars in the designing of these new financial products were also held accountable for manipulating and arranging US Treasury Law to serve the interests of the Bankers and the Wall Street speculators.


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