Stupidity got us into this crisis – why can’t it get us out?
Western politicians are trying to take the high ground, publicly criticizing bankers for paying themselves big bonuses.
Bankers like JP Morgan Chase CEO Jamie Dimon have shot back, saying, in effect, apologies and blame are not the point. Let's focus on getting out of the hole!
The reason that’s not enough, Mr Dimon, is, to paraphrase Einstein: the people who got you into the mess cannot get you out of it. Or to quote Big Al more or less exactly, you cannot solve a problem with the ideas or mindset that created the problem.
However, it is still a fair point: Bankers’ apologies or even their bonuses are a red herring.
We don't need bankers to apologise. After all, an apology only carries weight if you respect the person making it. Otherwise all that is left is for the banker to commit hara-kiri to prove that he does, despite your derision, have some honour.
There have been some tragic suicides but, as the journalist Taki Theodoracopulos writes, they have been among the decent few financiers whose hands were the cleanest, not the dirtiest. What we need from bankers is simple:
What is the value of your assets, marked to market?
What is your own best estimate of the value of these assets?
What is the chance of meeting your estimate, in what circumstances and over what time frame?
What are your liabilities?
Is your bank effectively insolvent and how did that happen?
What is the best way to clean up the mess? And, by the way, you will NOT keep your job.
To these questions (and western politicians haven't yet shown the competence to ask them) we have so far heard zilch.
So, yes, forget the apologies. What we need are answers.
Mark Gay, RT