Why The Profit Motive Is Problematic For Wall Street

Harvard Business Review:

The Financial Services Roundtable, the lobbying group for the biggest financial companies in the U.S., has a new "white paper" out with the rah rah title, "Financial Services: Safer & Stronger in 2012." A few of the bullet points:

Read the whole story: Harvard Business Review

Comments

[QuietClass]

06:12 AM on 02/05/2012

the MODERN profit motive is corrupt and an anathema to capitalism..

Wall Street bailouts and pilfering of the US treasury..
US Prison System and the Immigration Scam..
US Political System and its inherent corruption due to money..
Consumerism that results in slavery across the world..
Declining wages at the expense of enriching the unimaginably rich..
Cutting of social services for the poor to enrich the unimaginably rich..
The war on drugs..
The rise of the post 911 military state and the bilking of the US treasury by the MIC..
Trickle Down Economics (the fooling and bilking of the american people and theft of their personal assets)
Purposeful decimation of the american industrial base so the unimaginably rich can have cheap (slave) labor..
A Tax system setup to keep the unimaginably rich getting richer (eg. 15% tax rate on capital gains)
Citizens United & the SuperPAC..

ALL bi-products of a corrupt, emotionless, imbalanced, narcissistic pursuit of profit.

[Robert A Alba]

03:21 PM on 02/04/2012

The past practices of this industry when left to its own devices proves beyond a scintilla of doubt that the people who occupy the top tiers of its hierarchy should be treated like attention deficit 5 year olds. They need to be subjected to massive doses of behavior modification psychological therapy. In the event this does not work, they should be sedated and placed in padded cells where they can do no damage to the wider society.

[shankapotomus]

09:03 AM on 02/04/2012

Just remember 3 out of 4 people that work on wallstreet are democrats.

[schatsie]

01:58 PM on 02/04/2012

Just remember
REAL CAPITALISTS don't need bailouts.
REAL CAPITALISTS don't need lobbiests.
REAL CAPITALISTS don't need preferential tax rates
REAL CAPITALISTS don't need preferential interest rates....

[shankapotomus]

02:01 PM on 02/04/2012

Thats right but the government insist on it.

[r3000]

12:48 AM on 02/05/2012

Real capitalists don't threaten not to hire because they're uncertain right now.
Real capitalists in the 1950's wouldn't have allowed planned obsolescence to be doctrine in american manufacturing.
Real capitalists wouldn't let 3 trillion in cash sit on the sidelines because they can't think of a good investment.

In the end, sadly, american capitalists will lose-- we'll all lose.. due to cronyism, lack of imagination, lack of planning, lack of courage. Thanks guys. Thanks for taking a colossus-- american production, and turning us into a debtor state.

Clear the corner offices. Start fresh.

[frank1946]

01:20 AM on 02/04/2012

Cost/Availibility of Capital determines success of Nation States !

Accumulate Capital and usually you win no matter what Political Overlay you have.

America is squandering/wasting it's Capital.....................then Taxing it !

Go Figure ?

[schatsie]

02:00 PM on 02/04/2012

Give me a break, Warren has accumulated almost 50 BILLION and over his lifetime has paid less than 1% in total for that fortune.....WHERE ARE THE TAXES......well let me tell you, they are on us working grunts who are paying 5 to 10% on OUR CAPITAL.....get that? Wake Up and Return to Reality......and that is 5 to 10% on our capital EVERY FRIGGING YEAR not over our lifetime like the .01%........

[r3000]

12:54 AM on 02/05/2012

Not true. Money that doesn't move becomes dumb money. It's basically shark-like. If it sits in vaults, production moves farther and farther from the dumb money. When the dumb money finally wants to get involved again, it gets involved third-hand by way of agents. Dumb money, because it's been sitting, becomes unacquainted with producers.. and then you need a broker who knows an agent, who knows someone on the ground there, who knows an interpreter. Then, the dumb money doesn't want to invest because they don't trust the accounting.. so they look to hedge, and then the return doesn't look like enough. DUDE-- I've been through this cycle a bunch. Believe me.. simple accumulation of capital is moronic. Might as well be taxed. At least it moves again. T Roosevelt did exactly this, and it set the stage for the 20th century.

[Vincent Van Der Hyde]

04:57 PM on 02/03/2012

The profit motive.
The new name for greed.

[Hyblarvim]

08:42 PM on 02/03/2012

Vincent, What do you think should be done about Wall Street?
What kind of economic system do you propose?

[Vincent Van Der Hyde]

08:56 PM on 02/03/2012

Been down that road before here.
I'd advocate a mixed market model.
An economic market with tight regulatory control, a broad social safety net, and a tax system that prevents extremes of economic disparity. I'd call it, oh, Norway.

[schatsie]

02:01 PM on 02/04/2012

Sweden, Denmark?

[Jay Gould]

04:28 PM on 02/03/2012

I can't believe we are still talking about Suze Orman's prepaid card. It is a good prepaid card, but it's not anything close to what Orman claims it is: the best payment card you can get your hands on. The biggest issue, though, is that Orman makes it sound, although she never states it explicitly, as if her card can help users build their credit history when the fact is that the Approved card, or any prepaid card for that matter, has no effect on its user's credit history. http://blog.unibulmerchantservices.com/suze-ormans-prepaid-card-will-not-affect-your-credit-score

[neuromantic]

04:07 PM on 02/03/2012

This article provides an interesting complement to the subject (and science) of motivation, which I have been hearing about recently (here for example: http://www.ted.com/talks/dan_pink_on_motivation.html)

Clearly we should have rules in place that protect layperson investors and bank customers from the greed-fueled conflicts of interest in which the financial industry has been engaging. These rules don't have to be onerous and complex, just sensible and directed at a greater good. If the wizards of wall street complain there isn't enough financial reward, please review the above link, because they would evidently be doing better if the bonuses weren't so outsized. The managers should take heed of these findings and structure the reward system accordingly (and I mean boards of directors, who need to do a better job "managing" the executives they supervise).

[ema123]

07:06 PM on 02/03/2012

The problem is when sensible practical and pragmatic legislation proposed by the time it is voted and passed its nothing like the original proposal, with lobbyst often writing the actual legislation to assure enough loop holes and outs are there to make sure it has no effect. You can bet no corporation would ever make decisions or create a product or decide strategy like congress does, too many cooks spoil the soup.

[schatsie]

02:17 PM on 02/04/2012

We did have them, Glass Steagul was 23 pages....

[loki]

11:25 AM on 02/03/2012

while I agree with the article, I think HP should link to the next story on the Harvard review
http://blogs.hbr.org/fox/2012/01/is-the-next-karl-marx-a-manage.html?cm_sp=blog_flyout-_-fox-_-is_the_next_karl_marx_a_manage

Because it explains what Ive been saying for years. We dont need to argue that its either greed driven capitalism or complete socialism. There is a blend, a mix, a hybrid of the 2 that is needed for the United States of America as a whole.

[trailerguy]

11:15 AM on 02/03/2012

profit motive problem is simple, conflict of interest. private prisions are perfect example, they have a reason to keep people locked up and not rehabilate. Certian functions should be out of the for profit sector. Wall street is more interested in stuffing their own pockets than making moneyfor their investors.