I am a bit confused. If a derivative is a form of hedge or insurance, then why is 80% of the insurance written by 5 banks? It would seem to me that this is a heavy concentration of risk that go against the basic business principals of risk.
Sorkin's Questions to Bank CEOs, Answered [View article]
How do you restore the checks and balances a true board of directors should be.
Why should CEO's be paid based on stock price. They control some but not all of the stock price. The CEO's should be paid based on the elements they control such as ROE, ROI, ROA.
The only problem with this is the value of money is based on the public confidence. So are we going back to 1800s where each bank had their own currency.
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Sorkin's Questions to Bank CEOs, Answered [View article]
Why should CEO's be paid based on stock price. They control some but not all of the stock price. The CEO's should be paid based on the elements they control such as ROE, ROI, ROA.
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Same thing for commodities, is it supposed to minimize risk or be a crap shoot.
So I will start listening when Wall Street Leaders Step Up and do whats right.