I dropped off my seat, laughing hysterically, when I read this article. Now that investment banks have comprehensively wrecked the world's financial system, sending the world economy into a deep recession, Goldman Sachs wants tighter banking regulation.
Lloyd Blankfein, Goldman Sachs’ chief executive, has called for banks to adopt more stringent accounting practices, accept tougher regulation and give greater power to risk managers, in a trenchant analysis of the causes of the financial crisis and how they might be remedied.
In an article for Monday’s Financial Times, as the Obama administration prepares to rewrite the rule book governing the US banking industry, Mr Blankfein outlines seven areas of misdemeanour – ranging from “complexity [getting] the better of us” to the “outsourcing of risk management” to ratings agencies.
I just love that phrase "complexity getting the better of us". I also particularly liked the following quote from Mr. Blankfein:
“If more institutions had properly valued their positions and commitments at the outset, they would have been in a much better position to reduce their exposures.”
So, lets see if I understand this; if the investment banks knew that they were screwing up, then they wouldn't have screwed up. That is the kind of perceptive thinking that is worth a multi-million dollar bonus.