Wall Street Deserves Its Bonuses

All of America is upset about Wall Streets bonuses. Even The President is pissed. Guess what. All of America, including President Obama, is wrong. It's easy to say oh these already-super-rich CEOs are just lining their own pockets with taxpayer money, but that's a knee jerk reaction with no thought behind it. All of those billions in bonuses did not just go to CEOs. They went to tens hundreds of thousands of American workers. They went to traders and portfolio manager and secretaries and HR people. It was money that was promised to those workers as part of their compensation. It was money that many probably used to pay for their kids college tuition or pay off their credit card bill from Christmas or maybe just for the basic staples of life. Maybe they used it to pay their mortgages. If you just think a little, then maybe you won't be so outraged. Maybe you'll realize that it shouldn't even be any of your business.

But of course it is everyone's business because of the government bailouts of the banks. Worse we have all been brainwashed into blaming things on the greed of Wall Street. That is the great red herring of this depression. Politicians want you to think that all of our problems are the result of the greed of Wall Street. If you have a scapegoat to blame things on, then you do not have to take any responsibility.

So if it's not Wall Street's fault, then whose fault is it? There is an easy and a hard part to that. The easy part is that it is the government's fault. It is the fault of the Federal Reserve for using its unconstitutional power to amplify business cycles. The Fed created a climate of malinvestment by fixing interest rates at unsustainably low levels. And guess what, they continue to do this. The seeds of the next recession are already being sown today.

That's the easy answer. The harder answer is that its your fault. Its the fault of every American who bought houses they could not afford. Its the fault of every American who constantly refinanced their house to "cash out" their equity. This carpe diem approach has lead to historically low savings in America, historically high debt, and historically high rates of loan default and foreclosures. Those are the real reasons why any bank would be a fool to loan out money right now. No matter how much money the government gives them, it will never make any sense to loan it out. The people who would borrow are not likely to be able to pay it back.

Back to reality. Nobody is going to accept personal responsibility. It's the government's job to saves us from ourselves, right? I actually thought for awhile that maybe people would (rightfully) blame the government, but that has not happened either. The politicians have cleverly manipuated the masses to put the blame on banks and Wall Street greed. Now we are pissed that those banks are paying the salaries of their employees instead of lending money. It's obvious what is next. We take over those banks and force them to lend money to everybody. Then we will get what we deserve.