Pundit Country

First, it tells us that Goldman is very good at what it does. Unfortunately, what it does is bad for America.

Second, it shows that Wall Street’s bad habits — above all, the system of compensation that helped cause the financial crisis — have not gone away.

Third, it shows that by rescuing the financial system without reforming it, Washington has done nothing to protect us from a new crisis, and, in fact, has made another crisis more likely.

-Paul Krugman, NYT columnist and Nobel Prize winning economist on why Goldman-Sachs’ return to business-as-usual is proof positive that Obama’s promised reforms of the financial system have not gone nearly far enough.

Per his own statement, this is Obama’s mess to deal with now and while he has shown positive leadership in this area, he needs to get Tim Geithener to start putting the original reforms in impediments to abuse regulations back in place or we’re going to skid right back down the slope we were in at the beginning of the year.

Personally, I think that may mean jail time for those on Goldman’s board who are knowingly aggrandizing themselves at the country’s expense, but I’m open to options.

Related articles

• Paul Krugman can’t stop saying those three little words (dailyfinance.com)
• Robert Teitelman: The challenges of communicating the crisis (huffingtonpost.com)
• Paul Krugman on the Problem of Falling Wages (shoppingblog.com)

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