Incentivizing Incompetence

Essentially, that's what our government has done---and what our central bank continues to do, via regular infusions of free money---to the job creators who couldn't manage all the myriad risks they'd assumed over the last decade because they couldn't accurately value them. Which is to say, they failed to allocate capital in the most efficient manner, which is basically why banks exist in the first place. And since they were rescued absent demands for regime change or anything resembling a systemic restructuring, it should come as no great surprise that, yes, they're still doing a lousy job of asset management. Which might be tolerable---entertaining, even---if we weren't mortgaging ten years of growth to repair their crap-riddled balance sheets, with no assurance of a more prosperous outcome to show for all of our efforts.

---Baron V