My parents would often quote to me "You are your name." If you dirty your name, then what do you have? There are the golden rules. There are the fundamental rules of finance and accounting. There is the goal of low risk for maximum reward even though the greater the risk generally, the greater the reward. There is a happy medium between investors and creditors. PT Barnum said "You can't make everyone happy all of the time." In essence, the good businessman is going to be clean from the get go, & proceed for slower growth instead of trying to raise capital on unfounded opinions and a disregard for their investors and by doing so lose them and your business.
The financials are in turmoil because managers and marketers diverged their interest away from the common ground between the best interest of the stock holders and the creditors. The financial institutions in question collectively lied to all of their investors and told them things that were lies.
Today, finally a major financial, Citigroup (C: on the NYSE) settled a case regarding their fraudulant practices of touting Auction Rate Securities as cash. If I were one of the HNWI (High Net Worth Individuals) who got duped by unscrupulous bankers I would be taking my millions upon billions and leaving to an institution which stands due to their quality individuals who can make true, good and balanced decisions. The meltdown of these securities cost investors BILLION$.
I know that the financials really can't bare too much more on their balance sheets. You can't write off more than the value of the company. And you have to find some way of making your business profitable. However, it's time to do the laundry and I think it's time to hang a bunch of these white collar criminals out to dry. I'm tired and disappointed of everyone not playing it straight or stalling the real answers so they can cover their own keisters while letting their investors hang in the wind! Really good job they've been doing of it too... at the moment, Citigroup has lost $17.4 billion in the last 3 quarters.
Larry Kudlow says that he believes that "Free market capitalism is the best path to prosperity." The prudent investor should always do their own homework and read the entire contract before signing it, but it's nice to know every now and again, there's a cop in the house who is willing to go up against some of the corporations to ensure dirty business finds a quick end on behalf of all parties involved. The board of directors need to have a long talk amongst themselves as to how they are going to clean up their image, and move forward and their stocks upward. A special kudos go to The New York Attorney General and the Securities and Exchange Commission.