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Faulty Forecasting
Companies that specialize in stock market forecasting and trading—such as Goldman Sachs, Citigroup, Morgan Stanley, and JPMorgan Chase—pay very high salaries to their employee-vendors. New York Attorney General Andrew Cuomo just released data showing that these and other large banks are giving each of their 5000 trader-forecasters bonuses of at least one million dollars.
In return, these fat cats are very frequently wrong in their recommendations and decidedly unprofessional in their fiduciary relationships with the clueless, trusting clients who rely on them. Win or lose, they get their fees.
These firms and brokers are making money largely from other people’s money—pensions, savings and investments. Overall many produce little more than gambling tips. When these moneyboys try to justify their doings as providing liquidity, hedging against risk, assembling capital for productive investment, listeners are permitted to robustly laugh. This is especially so now during Wall Street’s massive, self-inflicted financial collapse. The economy, and taxpayers, are paying for this reckless speculation.
Filed under: economy, US Politics
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