The End of Wall Street as We Know It
In one week’s time, we have witnessed the stand alone investment bank business model of Wall Street swept away. Solomon/Smith Barney merged with Citi Bank years ago, Shearson, gone, years ago, E.F. Hutton, gone, years ago, Bears Stearns, merged with J.P. Morgan Chase, Lehman, bankrupt and merged with Barclay’s, Merrill Lynch, merged with Bank of America and now Goldman Sachs and Morgan Stanley have converted to commercial bank holding companies.
I remember vividly the experience I had a few years ago, walking down the storied “urban canyon” of Wall Street with a briefcase in one hand and a cigar in the other. About a hundred feet in front of me their was a family of Japanese tourists who had a mini DV camera set up on a tripod. They were filming me as I walked toward them. The kids looked to be between 8 and 12 years old and they were all beaming at me as I got closer to them. The father turned to his kids and then turned his face back toward me and as he pointed his finger at me he said excitedly in English: “Broker, Broker!”
I took a big puff on my cigar and as I exhaled I gave them a big smile and flashed the “V” for victory sign to them. They all squealed with delight and it was a wonderful moment.
I am sure that the enemies of capitalism are rejoicing this morning at the fall of Wall Street, but there are also millions of people around the world who hold treasured memories of New York’s financial district and all of the history that goes with it. They can rest assured that global capital markets will continue to be led by America and by Western Europe and that, although the business will in all likelihood be managed in a much better structured and much more conservative way, the brash optimism in America’s future and in the future of the stock market will continue.
I once heard a money manager say this: “Do these three things and you’ll never go wrong. 1. Buy stocks 2. Buy bonds 3. Vote Republican.”
~~John Cronin~~
September 22nd, 2008 at 10:34 am
Thanks, John for your comments on last week’s historic financial off-the-Richter-scale-EARTHQUAKE. I enjoyed your “striding down Wall Street” anecdote. Romney said it first and said it best: Washington IS broken. He also said last week: “Bubbles bust; they ALWAYS bust.”
Here’s the latest on AIG (American International Group):
AIG’s EX-CEO REFUSES $22 MILLION SEVERANCE PAYOUT
Mon Sep 22, 6:23 AM ET
(Reuters) - American International Group Inc’s (AIG.N) former Chief Executive Robert Willumstad has rejected a $22 million severance payment, the Wall Street Journal reported, citing a person familiar with the decision.
Willumstad e-mailed his successor, Edward Liddy, of his decision to forego the severance since he was not able to execute the restructuring plan he had developed, the paper said.
The newspaper also reported major shareholders concerned about the government takeover were planning to meet on Monday to discuss alternatives to the federal bailout, citing a person familiar with the matter.
AIG and Robert Willumstad could not be immediately reached for comment.
September 22nd, 2008 at 10:36 am
Schedule for PRESIDENTIAL and VICE-PRESIDENTIAL DEBATES
Associated Press
Republican John McCain and Democrat Barack Obama will participate in three 90-minute debates in the next three weeks. Their running mates, Republican Sarah Palin and Democrat Joe Biden, will hold one debate. All four are sponsored by the Commission on Presidential Debates.
FIRST PRESIDENTIAL DEBATE
Time/Date: 9 p.m. EDT, Friday, Sept. 26.
Place: University of Mississippi, Oxford, Miss.
Subject: Foreign policy.
Moderator: PBS’ Jim Lehrer, “The NewsHour.”
VICE PRESIDENTIAL DEBATE
Time/Date: 9 p.m. EDT, Thursday, Oct. 2.
Place: Washington University, St. Louis, Mo.
Subject: Domestic and foreign policy.
Moderator: PBS’ Gwen Ifill, “The NewsHour” and “Washington Week.”
SECOND PRESIDENTIAL DEBATE
Time/Date: 9 p.m. EDT, Tuesday, Oct. 7.
Place: Belmont University, Nashville, Tenn.
Subject: Issues from audience members and submitted by Internet participants, in town-hall format.
Moderator: NBC’s Tom Brokaw.
THIRD PRESIDENTIAL DEBATE
Time/Date: 9 p.m. EDT, Wednesday, Oct. 15.
Place: Hofstra University, Hempstead, N.Y.
Subject: Domestic policy.
Moderator: CBS’ Bob Scheiffer.
September 22nd, 2008 at 10:47 am
Things are revvin’ up…
CHAT NOW pow wow this Friday night (Sept. 26) to opine pre-debate, during debate, and post-debate. CHAT NOW will officially begin at 8:00 PM EDT (debate begins 9:00 PM). Feel free to comment earlier. Again, thanks to Ann Marie for providing this format!
Here’s a little background on how the candidates are burnin’ the midnight oil (From NY Times):
Obama plans to begin debate camp on Tuesday with a tight circle of advisers at a site in the Tampa Bay area of Florida, his aides say, with a prominent Democratic lawyer, Greg Craig, playing the part of Mr. McCain in mock debates.
The Obama campaign has been studying Mr. McCain’s debate performances from the Republican primary as well as in his 2000 race for president. Each debate has been rated and scored, with briefing points and highlights sent to Mr. Obama.
Mr. Obama’s advisers have been studying in particular Mr. McCain’s temperament and mood and looking for potential flash points of anger.
McCain, his advisers say, has yet to spend much time watching the dozens of primary debate performances of Mr. Obama over the last two years. But they said that a small staff of aides had been reviewing them and that Mr. McCain would see some highlights next week.
McCain aides refused to say when his debate camp would be or where, or who was playing Mr. Obama or Mr. Biden. (Gov. Jennifer M. Granholm, Democrat of Michigan, is playing Ms. Palin for Mr. Biden’s preparations.)
Obama plans to sequester himself and a few advisers at his debate camp. The attendance is limited to a small group of foreign policy advisers, each rotating in for separate sessions with Mr. Obama and Mr. Craig.
While the intense portion of debate training begins on Tuesday, Mr. Obama has been preparing for weeks, in part by drawing upon his experience debating Senator Hillary Rodham Clinton of New York in the Democratic primaries. His aides have been studying those debate performances to address one of his biggest shortcomings: his ability to deliver a tight answer. Already, his campaign is trying to diminish expectations for Mr. Obama’s performance.
“Despite the fact that we got the chance to do this a lot during the primaries, these debates are not by any stretch of the imagination his strong suit,” said Robert Gibbs, a senior strategist to Mr. Obama. “He likes to talk about a problem, give some examples that addresses some solutions and oftentimes that doesn’t fit into the moderator’s allotted time.”
September 22nd, 2008 at 12:42 pm
Hi all,
Looks like John McCain is returning to his old self. I just read this morning on Malkin’s blog that McCain is pushing amnesty for illegal aliens in PA. He is also interested in firing Chris Cox and replacing him with Andrew Cuomo, a democrat from the corrupt Clinton administration.
I’d like to say this is surprising, but it’s not. Any thoughts of Mitt serving in a McCain administration should be put to rest and never mentioned again. Why should Mitt be a part of this debacle?! John McCain will be tough on terrorism and that is it. Everything else will be some sharp compromise towards the left.
Here’s a link:
http://michellemalkin.com/2008/09/22/the-return-of-mcamnesty-the-democrat-suck-up/
September 22nd, 2008 at 2:32 pm
SED,
If McCain thinks he is trading up by replacing Cox with Cuomo, he needs to put the glass of Kool-Aid down.
September 22nd, 2008 at 2:43 pm
2tp,
I’m glad you enjoyed the post. Thanks for the heads up on AIG and for the debate schedule.
My local Republican committee will be working the Wash U debate, so I will have some first hand info to post.
September 22nd, 2008 at 2:53 pm
John,
I absolutely agree. Everytime John McCain starts to get me to turn towards possibly voting for him…something like this happens.
How can we have candidate that has liberal policies call himself a conservative? Then what are the rest of us?
At least GWB never hid behind the pretense. He called himself a compassionate conservative even though he failed to execute its brand properly.
September 22nd, 2008 at 4:06 pm
Sed. I’ve been saying that for weeks now. So far, I have not found one reason to cast my vote for JSM. Palin makes it even more clear I cannot. His judgemnt is severely lacking. Chris Cox is a super and knowledgeable man. He gave up his California congressional seat for this appointment. A safe seat, at that. The guy is almost lockstep with Mitt. In fact, if there were a veep choice for the Mitt, Cox would be amoung those I would tout. Mac passed him by, as he passed by many, many who could have shown strenght and courage and not yes’mamming. Our party is in freefall. I noticed Pawlenty, Jindahl, and a bunch of others who were quite vocal early on, are now all silent. Why?
This banking thing is a mess. Mitt can clean it up, but it will be painful. Andrew Cumo can’t tie his shoelaces without asking dad. Dumping Cox for Cumo is not the answer. It will only keep the problem taking on the everready bunny. It will keep going, and going and going and going.
It just chaffs me that everyone is now crying “MITT! Come SAVE us! But 2 months ago…. “Not mitt. Not him. And did you know? Hes mormon.
September 22nd, 2008 at 7:45 pm
I do think the key element for mccain to have a successful presidency is to staff the 4 or 5 big cabinet jobs with top notch talent, ditto the chief of staff job, that’s probably his most important pick…As for romney, this job sure seems to fit his background if mccain wins:
http://www.nytimes.com/2008/09/22/business/22treasury.html?_r=1&ref=business&oref=slogin
Yet, huge risk/huge reward in that spot for the next few years…
September 23rd, 2008 at 9:37 am
Blue - I agree that when a President surrounds himself with highly qualified individuals it should aid in creating a better administration and make for a successful Presidency. Unfortunately, it didn’t work for Bush.
To be a successful President, over two terms, the CIC needs to be able to comprehend complex issues and ascertain whether or not his cabinet members are effective in fulfilling their positions.
Clinton, aside from the Lewinsky scandal, was very good at this in his later part of the first and second term, as was Reagan throughout both terms. McCain strikes me as being tone deaf when evaluating cabinet positions and makes decisions based largely on his intuition. Gut instincts are useful for politics, however, over the long term fall short and are limiting, when governing.
If you listen to Romney, Bloomberg, Clinton, Reagan (back in the day), and other bright lights you can tell that 1. they grasp the issue, 2. understand the various factors that constitute a particular issue and 3. are smart enough to listen and offer comments that deal with the issue within its context and 4.a), they are not prone to over extend their remarks or b) offer remarks that have considerable amounts of bluster as opposed to substance.
September 23rd, 2008 at 11:17 am
Blue. Top notch talent is not what McCain has. His plan is to reach across the aisle and re run the likes of Cumo. Talent? He HAD talent within his grasp, and he stomped on it.
September 23rd, 2008 at 1:27 pm
Well, mccain could do it if he wanted to:
State - Joe lieberman
Def - Colin Powell
Tres - Mitt Romney
AG - Rudy
HS - Michael Steele
CofS- Rob Portman
As for mccain not picking romney as veep…if he had gone with another white male, than you could have a gripe but given the circumstances, its pretty rational for him to pick a female…just you could argue about which female mccain should have picked.
September 23rd, 2008 at 2:13 pm
Better yet, none of the above. He screwed them all. McCain could have picked one that many of us don’t find offensive. I find Palin to be a talk, no walk person. So many qualified women, and he scrapes the bottom of the pickle barrell.. What’s rational about not picking the right person for the right job - male or female. He could have presented it that way, instead he choose someone I can’t vote for. When I did some hiring, I did not look around and say “I need a black person, or a female’. I hired who could do the job the best. Not who can help me pander to any one group. And yes, my staff was still quite the rainbow!