Monday, September 29, 2008

Article: Corruption in financial sector is the killer

Here is an article in Xinhua newspaper:
http://news.xinhuanet.com/theory/2008-09/26/content_10113134.htm

A friend made a summary of the paper as follows:

Topic: Corruption in Financial Sector is the Killer
Author: Professor Chang Qing
Director of Commodity & Derivative Research Center
University of Agriculture, PRC

Summary:
1. Derivative and CDO are NOT new products.
2. They are designed by elite (i.e. the financial experts?)
3. Their ultimate objective is make money for the banker and salesman
4. The product has only one feature - that is cheat investor's money, resign and enjoy life within a short time.
5. "New financial product" is a smoke. Corrupt practice is the reality.
6.1 Company structure must not allow the CEO has absolute power to control money.
6.2 A company structure must be able to stop CEO from profit and resign within a short period.
6.3 Public scrutinization is of utmost important to check CDO with complicated mathematical
fomula. Media and economist must have a say.

I hope that this translation is accurate and that the statement is not defamatory. If there are any mistakes, please email to me at kinlian@gmail.com.

1 comment:

Weng Mao Fa 翁茂发 said...

Richard Fuld, Jr.

Company: Lehman Brothers
Lasted: 15 years

Unlike many of his fellow CEOs - E. Stanley O'Neill of Merrill Lynch and Ken Thompson of Wachovia - Fuld made it to the end after spending more than 30 years at Lehman. He left with his reputation in tatters, largely blamed for bad bets on mortgage-backed securities and a sluggish response to the bank's unfolding crisis. But Fuld didn't leave empty-handed: Lehman gave him a $22million bonus in March, and he pocketed about $500 million while leading the company.

http://money.cnn.com/galleries/2008/fortune/0809/gallery.ceos_banking.fortune/5.html

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