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Topic: This is SO wrong... (Read 534 times) |
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Brew
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Re: This is SO wrong...
« Reply #1 on: Mar 30th, 2008, 10:22am » |
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I'm not sure I understand why you would feel that way, Paul. This is a private transaction between one business that's buying another business. Where's the problem? How would government intervention make this better?
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Paul98
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Re: This is SO wrong...
« Reply #2 on: Mar 30th, 2008, 10:33am » |
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on Mar 30th, 2008, 10:22am, brewcrew wrote:| I'm not sure I understand why you would feel that way, Paul. This is a private transaction between one business that's buying another business. Where's the problem? How would government intervention make this better? |
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Countrywide made very poor buisness decisions and these were under the guidance of the CEO. The marketing paractices of the company resulted in mortages being granted to people that were in way over their head. The people should have known better but the company should not have granted the mortgages to people that could not afford them.
The CEO is being rewarded for bad practices. Many of the buisnesses have begun a practice of over inflating their worth and this leads to ultimate failure of the buisness and with it so goes Joe sixpacks money while the CEO's are rewarded. For the last 15 years the SEC has not been looking at the books of corporations and it has lead to companys playing fast and loose with other peoples money.
-P.
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Brew
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Re: This is SO wrong...
« Reply #3 on: Mar 30th, 2008, 10:43am » |
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on Mar 30th, 2008, 10:33am, Paul98 wrote:
Countrywide made very poor buisness decisions and these were under the guidance of the CEO. The marketing paractices of the company resulted in mortages being granted to people that were in way over their head. The people should have known better but the company should not have granted the mortgages to people that could not afford them.
The CEO is being rewarded for bad practices. Many of the buisnesses have begun a practice of over inflating their worth and this leads to ultimate failure of the buisness and with it so goes Joe sixpacks money while the CEO's are rewarded. For the last 15 years the SEC has not been looking at the books of corporations and it has lead to companys playing fast and loose with other peoples money.
-P.
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I don't disagree with anything you've stated. And perhaps the SEC should be doing a better job of oversight when it comes to shady business practices. But in pure capitalism, these things do eventually take care of themselves. Businesses like Countrywide go under precisely because of everything you've stated and more.
It's a dog-eat-dog world out there, and guys like you and me are wearing Milkbone underwear. Caveat emptor.
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chewy
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on Mar 30th, 2008, 10:18am, Paul98 wrote:I am against government intrusion into buisness but my attitude is changing because of instances like this...
-P. |
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Oh dont worry they dont have time for intrusions.
They still need to determine if Roger Clemens used HGH.
Time consuming.
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Paul98
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Re: This is SO wrong...
« Reply #5 on: Mar 30th, 2008, 10:59am » |
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on Mar 30th, 2008, 10:43am, brewcrew wrote:
I don't disagree with anything you've stated. And perhaps the SEC should be doing a better job of oversight when it comes to shady business practices. But in pure capitalism, these things do eventually take care of themselves. Businesses like Countrywide go under precisely because of everything you've stated and more.
It's a dog-eat-dog world out there, and guys like you and me are wearing Milkbone underwear. Caveat emptor. |
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Yes, it dog eat dog in the buisness world. I do think the SEC has the obligation to make sure corporations play by the rules. They (the SEC) has turned a blind eye or just not done their job with a lot of buisnesses. When corporations are allowed to inflate their worth, pump up stock prices and a select few bail out with their pockets stuffed while the true "owners" of the company are left holding an empty bag...it is wrong and it destabilizes the stock market.
About 2 years ago I noticed several of the big oil companys quietly reassesed their projected oil resurves. They lowered their estimates of potential holdings. I think Bush had a part in this. It was a good move and it was because of pressure of oversight. These are some of the biggest corporations in the world and if they start to tank the world staock market will go south.
-P.
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monty
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Re: This is SO wrong...
« Reply #6 on: Mar 30th, 2008, 12:36pm » |
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Corporate governance is as bad as public governance.
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Charlie
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Re: This is SO wrong...
« Reply #7 on: Mar 30th, 2008, 12:40pm » |
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on Mar 30th, 2008, 10:49am, chewy wrote:
Oh dont worry they dont have time for intrusions.
They still need to determine if Roger Clemens used HGH.
Time consuming.
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Right Chewy!
While I like being able to see "our" government in "action," it pisses me off that this is the kind of dumbing down shit we are stuck with. 
That said, when business gets to a level of greed not seen since the gilded age; some brakes need to be applied. This is the first time in my life that I've seen such greed without conscience. I'm for business but they'll either have to deal with us in a business like manner or likely wind up dealing with government interferance that won't be friendly.
Charlie
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BMoneeTheMoneeMan
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Re: This is SO wrong...
« Reply #8 on: Mar 30th, 2008, 1:43pm » |
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I disagree too, Paul. I think as long as there is no illegal activity going on and as long as they have the required capital on hand as set by banking and lending laws, everything is ok in my book. They took a gamble and they lost the bet.
3 years ago CountryWide was a darling lender and others tried to follow their lending and marketing practices. Unfortunately, just as in the stock market lesson of the 90's, investments do not go straight up forever. Countrywide's business model worked well in a bullish market, but the bearish market killed them. I agree, I don't think the CEO should get $10 mil for hurtng the company so bad they had to sell.
I would be really pissed off if the government bailed them out.
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Callico
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Re: This is SO wrong...
« Reply #9 on: Mar 31st, 2008, 11:48am » |
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Paul,
I have to respectfully disagree this time. The deal with BOA was made a year before the bubble burst. I agree that the price for the CEO and the President were excessive, but compared with others of their stature were not out of line. They made a lot of money for Countrywide.
As far as the sub-prime lending they did, it is less than 10% of the loans put out by the company. While the company took a big hit, and was on shaky ground for a while, they were never unprofitable. They had a problem with cash flow that put them at risk for a short time.
Sub-prime lending needs to be governed a little bit better, but I believe the business world is the place to do it, not the government. This is already happening, and will take care of itself if allowed to do so. That will free up Congress for the aforementioned higher priorities.
Jerry
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