I love Warren Buffett. Bloomberg.com has some of his snippets from yesterday, May 4.
“The best way to ensure proper behavior is to have the incentive system right.
“If you don’t have the proper incentives, leverage will be used, and used improperly.
“You can have intense regulation. Or you do it by having some severe disincentives, where if the place goes broke, you shoot the guy. And if that happens, you will use less leverage. I guarantee you.”
In other news, it seems the market is having a field day with Bank of America now. Hey guys, banker guys, gals and C Suite-rs, stress tests on our banks is a good thing. If some banks have to fail, so be it. That’s the way it works, the FDIC will go in and deal with the transfer. Sorry bankers, with all your crazy disposable money, the game is over now – so fork over your 2nd, 3rd and 4th home (you can keep your 5th condo,) and deal with it.
would love, as always, your thoughts.
[Ed note: Bank of America and also Wells Fargo haven’t passed the stress tests, apparantly. Do you know who bought Wachovia? Wells Fargo. Just sayin’]