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"The corporate brand is not only used to improve competitive positioning and express company aspirations, it can also be a powerful tool to motivate employees."

Market Populism: Karl Cates

The line -- if there is one -- between free-run capitalism and the greater good.

Oct 22

The pay czar whips out his Taser: a populist jolt aimed at getting Wall Street’s attention

Posted by kcates in pay czarKenneth Feinbergcompliancecompensation


Much of the immediate reaction to the news that Ken Feinberg is playing payroll hardball with Wall Street was from compensation gurus complaining that the White House was using an overly blunt instrument.

"Surgery with a sledgehammer " is what one of them called it.

Oct 12

Wall Street doesn't merit 'combat pay'

Posted by kcates in meritcompliancecompensation


Marketplace, the public radio show based in Los Angeles, a week or two ago had on a hedge-fund-manager- turned-book-writer by the name of Andy Kessler who said one of the dumbest things I've heard anybody say in public in awhile, much less on a popular radio show: "Wall Street is as close to a meritocracy as exists on this earth."

He of course was repeating the "eat-what-you-kill" myth that supposedly guides the street.  It's a rule that applies to certain strata, in certain circumstances, yes, but it's a canard when your reach the upper echelons.  If the Street is a meritocracy, why do we have so many executives so handsomely compensated for failure? 

Oct 10

Pushing 'dark pools' into the light

Posted by kcates in secSchapiroKarl Cateshigh-frequency tradingflash tradingdirect-market accessdark poolscomplianceco-location


Now that the SEC has brought the hammer down on flash-traders, it's angling to get rid of dark pools, which are very close cousins to the flash trade.  I believe someone writing on this very site a couple of months ago predicted this eventuality.

Flash-trading is the practice of buying early access to market prices, and the ability to trade on that information ahead of everyone else.   Dark pools are similar in that they allow big-volume traders to do business without publicly displaying prices until after a trade is executed.  This gives a built-in advantage to players who can afford to buy into dark pools (Goldman Sachs, for instance, is what you could call a charter member).

Oct 06

Job offer: $20,000 (if you hire somebody)

Posted by kcates in unemploymenttax creditObamaKarl Cates


Acutely aware that growing joblessness is becoming an ugly issue that’s only going to get uglier as cold weather sets in, the Obama administration is considering offering tax credits to businesses that hire new workers.   

It’s part of what may now be a try-anything strategy as the politics of double-digit employment become more apparent: how are you demonstrating effective leadership when one of four households has experienced a job layoff in the past year, when the employment picture is only getting worse and when banks are bailed out while working people are thrown under the bus?

Oct 02

All in the (Madoff) Family

Posted by kcates in MadoffKarl CatesIrving Picardcompliance


Innocent though they may (or may not) be, Bernie Madoff’s brother, niece and his two sons are part of the sad court docket surrounding the case of Bernard L. Madoff Investment Securites LLC.

The latest filing has yet to be posted at this hour on the Web site of the court-appointed trustee, who usually keeps it extremely up to date.  But according to several news organizations, the trustee, Irving Picard, sued today to make the four family member pay back some of their ill-gotten Madoff gains. Newsday says the lawsuit is asking for $200 million, Reuters has it at $199, the Associated Press reports $198.  Whatever, the difference is chump change in the grand scheme – and I do mean scheme – of things.

Oct 02

Book Pitch! "Inside Moody's and the Culture of Deception"

Posted by kcates in Scott McCleskeyratings agenciesMoody'sKarl CatesEric Kolchinksycompliance


Scott McCleskey can be forgiven if when he looks in the mirror in the morning he sees Scott McClellan, the former White House spokesman who came out with that poison-pen chronicle after the Bush people finally closed shop and left everything in shambles.

A used copy of McClellan’s kiss-and-tell, "What Happened: Inside the Bush White House and Washington's Culture of Deception,” can be had today for as little as $3.89 on (new copies are $21.24, roughly 24 percent off the cover price, although I thought I saw one on my corner bookstore’s “great values” table the other day for $9.99.)  

Sep 26

Elections have consequences: Here come new merger regs

Posted by kcates in mergersM&AKarl CatesJustice DepartmentFTCcomplianceantitrust


The merger police are back on the beat.

Christine Varney, the assistant attorney general in charge of the antitrust division at the Justice Department, said as much not long after President Obama was inaugurated.

Sep 24

How much oil is left?

Posted by kcates in Raymond Jamespeak oiloil productionMichael RuppetKarl CatesHubbert's PeakCollapse


Far be it from me to answer so colassal a question.

But others try. Take Michael Ruppert, the eccentric centerpiece of "Collapse," a documentary coming soon to a theater near you. Ruppert is a pretty well-known proponent of the notion that we've achieved peak oil - the point at which we can pull this much of the black stuff from the ground and no more. He's also a radical voice on the subject of Where We Go after the well runs dry, and his view of the future is apocalyptic. The movie is getting some serious buzz on the film festival circuit.

Sep 17

Banker Pay: the Fed (finally) cracks down

Posted by kcates in reformpayKarl CatesFedcompliancecompensationbonusesBanks


It’ll be interesting to see how the Fed’s bold proposal to rein in banker pay will play out, but it’s hard to imagine much effective resistance.

The scheme would keep payrolls at the 20 or so biggest banks under the government microscope and make an additional 5,000 smaller banks abide by compensation guidelines.

Sep 14

Not on Jed Rakoff's Watch

Posted by kcates in RakoffMerrillKarl CatescomplianceBank of America


Pretty scathing stuff today from Jed Rakoff in his rejection of the Merrill Lynch settlement.  Recall how the SEC had agreed to a $33 million deal in a case alleging that Bank of America and Merrill had not been forthright with shareholders about a plan to pay Merrill executives as much as $5.8 billion in bonuses on the eve of the firm's merger with B of A.

 Well that didn't go over so good. 

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