Ripped from the wires ... Florida columnist Robyn Blumner sends this holiday "love note" to the proprietors of the institutions that our wonderful national politicians regard as Too Big To Fail:
By Robyn Blumner
Dear Too Big To Fail,
Happy Holidays to you. I'm guessing your end-of-the-year bonus won't be quite as eye-popping as it was last year -- sorry there. But at least you still have a job. That's not necessarily true for my associates in the world of Too Small To Matter. We're hurting during this economic meltdown. You know, the one that you caused.
I hope you count your blessings this year as you tighten that extra-long belt. I suggest you go easy on the Chateau Mouton-Rothschild; you never know if the Treasury Department and Congress will finally get serious about limiting your compensation in exchange for the billions you're getting in bailout money.
I know you say it would be nearly impossible to find someone as smart as you to take over the Too Bigs for a mere few hundred thousand a year in total compensation.
After all, it's always challenging finding someone qualified for vacancies on the U. S. Supreme Court. Justices pull in about $200K, and at that salary the jobs just go begging.
But you have a point about the value of your special kind of intelligence. What do you think the ratio is? For every dollar a Too Big CEO earned, he laid the groundwork for losses of $1,000, $10,000, $100,000 for his company and its investors? Yup, those kinds of smarts would be hard to replicate at any price.
I have to hand it to you, though, in the way you Too Big people arranged the world so nicely for yourselves. How is it that you got the very federal regulators (or anti-regulators, as you demanded they be) who kept their hands off exotic securities under the banner that the free market had to operate unfettered, to swoop in when you got into trouble from your gambles in those same instruments?
How is it that you got the very economists who wrote Ph.D. theses titled "Government Must Never, Ever Act To Head Off Any Financial Bubble'' to suddenly demand blank government checks for all the Too Bigs, when your bubble burst?
In the Too Small world, this is all beyond our ken.
From our simple take, the only idea tried so far to loosen credit markets is to dip a hand in our pocket and give the money over to you in ever larger chunks. Then hope that you don't hoard it to freshen your balance sheets, pay out dividends or pay yourselves first.
Funny how those hopes vanished almost as soon as they were aired. When you Too Big guys find yourself together in the Men's Room, you must really get a chuckle out of that.
We do have questions, though, from our lowly post.
How is it that the big three credit rating agencies are still operating? If I had turned an ungodly profit by putting my seal of approval on investments that turned out to be garbage, not only would my company be toast but I'd be deeply worried about personal liability and jail.
Instead, the big three keep churning out ratings, while their top executives shrug at that hiccup found in their complex algorithms. I mean, who would ever think to put into a risk calculation of securitized packages of home loans the possibility of housing prices falling? It's too crazy.
And then there's the little trick -- cute really -- that Citigroup has been playing with its bad assets. The corporation moved billions of dollars worth of them "off balance sheet.''
Now we Too Small To Matter folks have trouble even reading a balance sheet. But is it really true that in your Too Big world a financial statement that doesn't reflect all toxic assets is just cutting-edge accounting?
See, where we come from, it's fraud.
Well, since your time is about 400 times more valuable than ours relative to how much we're paid, I won't bother you anymore.
Enjoy the taxpayer charity. Yours in Penury, T.S.T.M.
Reach Blumner, a St- Pertersburg (Fla.) Times columnist, at email@example.com.