The World meetings of the G20 and others are outlining what the United States is to do.   No wonder we aren’t doing well.  I found this article in the Guardian.co.uk news.  Read it and let me know what you think.   There might be something the people are going to have to do to get our country back in the United States.  We are a World Leader not a World Follower!  The fact the government is interferring in the natural progressive of business of success and failure, has caused banks to not worry about the success of their institutions because they have no reason to succeed, no reason to compete because risk of failure is gone, the risk of investing in the business is gone, so what do they do, take advantage of a scenario is to pay out huge bonuses to themselves because else are they going to do, the government will bail them out, why do they need to work to make them strong or fail.   There is none really.   Government will decide who wins and who loses. 

 Goldman Sachs prepares for payday showdown

Do not be fooled. The world’s big investment banks have not reinvented themselves as do-gooders who think bonus levels are excessive. The agreement with the British government merely obliges banks operating in London to comply with principles agreed at the G20 summit. Of course the banks have committed to be supportive – they had no choice.

The key point is that the G20 principles do not place any cap on the size of bonuses. What they do instead is to force banks to avoid reckless payments. Bonuses must be spread over a longer period; they must be subject to clawback; more of the spoils must be paid in shares; and more information must be published about who gets what.

These are fine principles, of course, but no bank management was ever likely to resist them. Far-sighted executives had already concluded that tighter ties between pay and performance might serve their own interests.

For an industry that has just brought the financial system to its knees, the G20 outcome represents a terrific deal: get-rich-quick schemes are out, but get-rich-gradually schemes are in.

Meanwhile, the value of a licence to get-rich-gradually becomes clearer. JP Morgan said its profits in the third quarter of this year were $3.6bn, up from $527m a year ago. Goldman Sachs will report a more spectacular return to form. It’s as if the crisis never happened.

Two main factors are at work.

• First, the demise of Lehman Brothers and others has removed competition.
• Second, the system is benefiting from what even investment bankers call an “implicit central bank subsidy” in the form of a guarantee that bank creditors (unlike those at Lehman) can’t lose their shirts.

Lack of competition produces powerful effects in areas like fixed-income trading, a big winner for JP Morgan. To understand how rewarding the game has become, here is an example offered by a senior Goldman executive recently:

In the old days, when the spread between bid and offer prices was tight, a €1bn order from a client for Italian or Greek bonds would yield virtually no profit for the bank. These days, he reports, the same transaction would produce a sum close to €5m. Nice work if you can get it.

The Goldman banker, you will have guessed, was not citing this example to confess to how easy life has become. His argument was that the investment banks’ current mega-profits won’t last. Competition will arrive in time and erode those margins. In other words<