The pay issue is silly stuff. They need to focus on regulating derivatives, seperating commercial banking from investment banking and ensuring good capital standards... http://www.bloomberg.com/apps/news?pid=20601103&sid=asWhNfxDFk6M Oct. 23 (Bloomberg) -- Eric Dinallo, former New York state insurance superintendent, said reducing risk-taking by financial firms is more important than... [more]
The pay issue is silly stuff. They need to focus on regulating derivatives, seperating commercial banking from investment banking and ensuring good capital standards...
http://www.bloomberg.com/apps/news?pid=20601103&sid=asWhNfxDFk6M
Oct. 23 (Bloomberg) -- Eric Dinallo, former New York state insurance superintendent, said reducing risk-taking by financial firms is more important than restricting executive pay. The pay issue is just part of the circus so congressmen can sound "outraged"
“The real problem is not around compensation,” Dinallo said today in an interview on Bloomberg Radio in New York. “It is around the regulatory structure that has not been changed in Congress.”
The abrogation of Glass-Steagall was a disaster,” Dinallo said. Banks that are “essentially being subsidized by America and the taxpayers” should be restricted from bets that risk depositors’ funds, Dinallo said.
He urged Congress to curb credit-default swaps, which forced New York-based insurer American International Group Inc. to take a government rescue valued at $182.3 billion. AIG posted a record fourth-quarter loss of $61.7 billion on costs tied to the swaps, which guaranteed mortgage-linked investments for banks.
“I am shocked that one year after this instrument brought a lot of havoc, it has not been solved yet,” Dinallo said.
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