During the last few weeks, the news of major financial groups losing tens of billions of dollars as a result of loses in what is called “sub-prime lending” all over the place and forms major headlines. Major financial groups lost billions in an effort to fleece the very poor targeting this segment of consumers with predatory lending practices.
Given the salaries and benefits of these top American executives, one would presume these executives are highly paid because they are smart businessmen who study their prospective decisions very carefully and not make decisions bound to cause big time losses. The question I have how can it happens that these big time executives make such big time mistakes? And end up getting paid tens of millions.
Every big time executive knows that American consumers are under constant attack from major financial companies such as mortgage companies, credit card companies, care financing companies, credit rating companies among others. All are dedicated to fleecing what they refer to as “sub-prime”. Those who are hardly making it, and who are on shaky financial grounds and who for the most part are having a hard time making ends meet.
American consumers are under attack by these big time bullies, with the support of our illustrious congress who gave the power and authority to the lobbyist to make laws that make it legal to go after these poor people and fleece them.
Financial institutions when making the decision to actively engage in predatory lending knew they are targeting a class of consumer who are “high risk” and they went ahead any way because they knew they can make quick bucks initially and they knew in the end, these high risk consumers will have a hard time meeting their financial commitments to lenders. Yet they went ahead and they knew they will lose in the end. However they also knew that while they (executives) can make hundreds of millions of dollars in salaries and compensation during a certain period of time, they knew their companies, companies entrusted to their care and proper management will lose in the end. Yet they went ahead any way with their attack and assault to fleece consumers.
Who would believe that in the US credit card companies charge consumers some 25-30 % in annual interests? Making it almost impossible for any one to pay in full the amount even if they end up paying for many years. Our Congress, full of crooks and full of members who sold their souls and ethics to big time corporations and lobbyists making it legally possible for American executives and corporation to fleece, rob American consumers and tax payers.
Only in America the land of the professional crooks “business executives” where consumers and shareholders end up paying for well organized and well executed reckless decisions causing companies to lose tens of billions of dollars.
Only in America, where business executives can lose tens of billions of dollars during their tenure as top managers and walk away with tens of millions if not hundreds of millions laughing all the way to the bank and laughing at board of directors who allows them to fleece the companies and fleece shareholders and consumers. Yes these executives have every reason to laugh all the way to the bank and have contempt for board members, shareholders and consumers.
I know of business executives who left lucrative salaries to go and sell cars to the very poor making sure the very poor end up paying for the car many times over. I also know of dealers who charged consumers thousands of dollars in added insurance and other benefits knowing that consumers will never make a use of such insurance.
It is not so surprising that someone like Stan O’Neal, the former head of Merrill can walk away with some $250 millions when he presided over the lose of some $ 7 Billions by Merrill.
Angelo Mozila the CEO of Countrywide can cash in some $ 130 millions in stock during a time when his company was about to declare billions of losses arising out of its practices of predatory lending and its active involvement in lending to sub-prime consumers.
Also it is not so surprising that the top executives of one of the major credit card companies can make over $250 millions in annual compensation when his company is charging poor consumer interest rates that are USUARY by all means. One has to wonder how many households have to scrap the $50 or $ 100 a month so that this Mr. Executives can make his $ 20 million monthly salary.