“There are three types of bankers: those that can count, and those that can’t.” – Eddie George
Martin Taylor, former Barclays CEO:
Yet two years later the whole industry was bankrupt.
A simple reason underlies this: any industry that pays out in cash colossal accounting profits that are largely imaginary will go bust quickly.
Not only has the industry – and by extension societies that depend on it – been spending money that is no longer there, it has been giving away money that it only imagined it had in the first place.
Worse, it seems to want to do it all again.
Paying out 50 per cent of revenues to staff had become the rule, even when the ‘revenues’ did not actually consist of money.
How did the shareholders let them get away with this? They were sitting on the gravy train too, enjoying the views from the observation car. How did the directors let it happen?
While many argue about regulatory overreach in a nation of chaos, Yves Smith at NakedCapitalism sees very much fraud, “We all need to start using the F word a lot more, because a great deal of what went on was criminal and needs to be described in those terms.”