Do you trust the world of Finance?

There is a new poll from CNN which reveals an American public strongly disappointed in our financial establishment. 59% said that the U.S. government regulates financial firms too loosely, and 74% felt that the recent Madoff Ponzi scheme reveals behavior that is fairly common in the trade. It is to be assumed that there are some people out there imitating the investors of the Depression Era, by putting their money in their bedroom mattress rather than handing it to someone they do not trust.

Now I would quibble here, and argue that there is a distinction to be made between wilfull fraud such as Madoff and Enron, and mere stupid risk taking such as the banking industry behaviors that helped create the subprime mortgage disaster and the foreclosure wave. But it can truly be stated that whenever the financial industry engages in incompetence and stupid risk taking and sloppy over-use of leveraging, as has recently been the case, one consequence is going to be a near complete loss of confidence in them. It can also be stated that both things, malicious fraud and overoptimistic incompetence, are the inevitable result of allowing an industry to police itself.

Read the poll for yourself:

http://money.cnn.com/2008/12/22/news/economy/madoff_poll/index.htm?cnn=yes

In other financial news, some of the banks receiving big cash chunks in the recent Bush Treasury Dept. Bank Bailout declined to list what they are doing with the cash. The 116 banks that so far have received taxpayer dollars to grease their path through the economic crisis also apparently gave their top tier of executives nearly 1.6 billion in salaries, bonuses, and other benefits in 2007. Heckova job, Brownie!