Friday, February 25, 2011

Recruiting America to War on Itself

By Michael Winship
February 25, 2011

"More cheese, less sleaze!" That was the funniest group chant at Tuesday’s rally of several hundred union and other progressive activists outside the Manhattan headquarters of Fox News.

Read on.


Big Em said...

Exactly spoken! You've nailed it virtually 100% Mr Winship!

Peter Loeb said...


To begin to comprehend sets of
economic realities, I turn to
explanations of more experienced
minds. Even though I do not share
the basic premises of these sources
(which are, after all, integral
parts of the problem), I find that
I can often learn.

(Warning: In my tiny public high
school, "math" ended in "numbers",
not "data" or "computer "models".)

Economist Joseph E. Stiglitz defines THREAT as "taking from
someone without consent."

The term "stock option" often comes up and Stiglitz deals with
this primarily in his chapter entitled "Creative Accounting".
Stiglitz, W.W. Norton & Co.2003).

Most of us do not have any "stock
options". This practice is symbolic
of many operations on Wall Street.

Sock options involve "the right to
buy company stock at below market
prices---and then pretending that
nothing of value had changed hands."

Stiglitz goes on, "When executives (or other employees) receive stock options, a company is committing
itself to issue new stock, thereby
diluting the value of existing stock...Assume a case in which
there are already 1 million shares outstanding, each worth $30...

If its executives get, say,
an additional 1 million shares free, then the old shareholders will have to share the company's wealth...and the value of each
share will fall to $15.

..shareholders NOMINALLY own and
control the firm but in fact
they have limited information about
what the managers are doing, and
limited ability to do anything
about it..."

I have purposefully eliminated
much of the detail, tax implica-
tions and the like.

However, I believe my abbreviated
description gives us all an idea
of the depth of Wall Street machinations (limited here to stock options only).

It also underlines our helplessness
in "doing anything about it".

The challenge to all of us is to
learn what we can. There are no "easy answers" but as always
KNOWLEDGE must be a key.