Geithner vs. the nature of things
A casual glance at financial markets circa, say, 2005, finds smart money scooting around regulators (the SEC, the IRS, etc) to swim in black pools, park itself in off-shore tax havens and invest in assets so hot they would become radioactively toxic in just a few months. Market professionals were paid a pretty penny, and in many cases worked very hard, to perform feats of financial wizardry that would keep the smart money where it belonged – out of sight.
Here we are in 2009 and Treasury Secretary Timothy Geithner is preparing to lobby Congress for a huge boost to the regulatory arsenal that the government can wield in its herculean effort to contain the natural inclination of money to find a way around the rules. Mobs are scouring Connecticut looking to shame the money magi of yesteryear into returning their earnings. America is wracked with fear. Talk of government-ensured employment is burbling around Washington, and bonuses are a bad thing.
Prognosticate yourself forward a few years … how many is anybody’s guess. Financial wizards likely will be wielding even more complex instruments to wend their way through the gaps and inefficiencies of a reinvigorated regulatory framework — and commanding more exotic fees. After all, this is America. We reward innovation.
Deals of the Day:
* Japan’s Mitsubishi UFJ Financial Group and investment bank Morgan Stanley will merge their Japanese brokerage units to chase industry leaders Nomura Holdings and Daiwa Securities Group. MUFG will take a 60 percent stake in the venture, to be formed by March 2010, the two banks said.
* Intel Corp Chief Executive Paul Otellini said IBM’s discussions to acquire Sun Microsystems Inc are likely to succeed for one ringing reason: Money Talks.
* Corriente Resources Inc is near closing a sale deal with China’s Tongling Nonferrous Metals, senior Ecuadorean officials with direct knowledge of the negotiations told Reuters.
(PHOTO: U.S. Treasury Secretary Timothy Geithner is seen speaking on a television monitor in the overflow room of the Council on Foreign Relations in New York, March 25, 2009. REUTERS/Shannon Stapleton)