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Executive Pay Caps Punish Americans


Investors include average people, not just CEOs.

The Dow found a way to rally Friday, achieving an almost 300 point reversal off the bottom. Of course the move was advertised as an assumptive action on the part of investors that a deal would be crafted on Capitol Hill over the weekend.

Interestingly, action in the credit market said the exact opposite. If I had to rely on one to be a canary in a coal mine, it would be the latter for me.

Be that as it may, equities looked pretty good, especially those banks that could be among those still standing when the dust settles. There was a part of me that wondered if the market was up because it took the Washington Mutual (WM) news in stride, with just a little initial nervousness and then displaying adult-like calm. Then there was another parMinyanville's Why Wall Street Will Never Be the Samet of me, albeit a smaller part of my being, that wondered if the market was up on Friday because there was a chance of a deal not happening. I know it's one of those things we'll never really know, however, because a plan is going to be unveiled.

I know it's silly to think that's the case but I always become suspicious when everyone says the sky is falling. I've noticed the "anarchy crowd" is having the time of their lives.

I've gotten a few emails from those folks, who predicted or hoped the economy would fall apart and now feel their predictions are coming true.

Of course, many of these predictions have been in place for years, even decades, and I didn't hear a peep a year ago when unemployment was close to 5.0% and the Dow nearing an all-time high.

Sure, easy monetary policy, the real estate gold rush and excessive greed all played a role in creating the current situation, but I feel many folks are using the situation to attack the very nature of capitalism. (The Finance Minister of Germany places the fault of the world's economy ills largely on Anglo-Saxon capitalism, which seems so disingenuous coming from the largest exporter in the world. It directly benefits from those Anglo-Saxon economies sucking up all those very expensive cars, coffee making machines and other gadgets.)

People are unhappy that their tax dollars are (seemingly) going to shore up Wall Street and it would seem that the politicians that have the nerve to go against the package might be viewed as heroes. Both McCain and Obama back the plan, so I don't think it benefits either candidate.

To me. the truly scary thing about this whole affair is there is more sympathy for people that spend more than they make than for the 60-year old couple down the street that always lived frugal lives and hoped investing in the stock market would help them in the golden years, as well as their children and grandchildren.

I can't believe it, but presidential candidates are rooting for these "investors" to lose their money. In an effort to kill executive compensation we are actually willing to crush fellow Americans in the process. As for executive compensation, it's almost a moot point considering they'll pay substantially higher taxes anyway, so we could limit what they make and actual put fewer dollars in the system for redistribution.

In the meantime middle management, self employed entrepreneurs and hard working couples, will see their checks waxed in the name of fairness, which is a giant farce. If things in the economy get worse before they get better a lot of people that assume they'll be on the receiving end of the redistribution largess will end up having their own wallets and pocketbooks lifted, too: Sometimes when one smells blood in the water, it could be one's own.

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