Colpire i bonus per limitare il rischio?

’sto coso l’avevo scritto durante il soggiorno francese. Pensio sia comunque attuale. Ma non ho voglia di tradurlo

G20 announced his will to “crack down on banker pay and pledge to better co-ordinate economic policies as they endorse a plan to force banks to tie compensation more closely to risk and tighten capital requirements” (ht ftalphaville ).
now, a research shows that “There is no evidence that banks with CEOs whose incentives were better aligned with the interests of their shareholders performed better during the crisis and some evidence that these banks actually performed worse both in terms of stock returns and in terms of accounting return on equity. Further, option compensation did not have an adverse impact on bank performance during the crisis. Bank CEOs did not reduce their holdings of shares in anticipation of the crisis or during the crisis; further, there is no evidence that they hedged their equity exposure. Consequently, they suffered extremely large wealth losses as a result of the crisis.”
(ht lakeside capital)

So if bankers suffered losses as well as the others because of the crisis, and if their pays and incentives scheme are not correlated to it, isn’t this G20 will unuseful?
As a matter of fact, banks DID took risks, as their leverage level showed. The point is finding out the reason why, if we assume this research’ results true. Point is, governments already know what lies at the root of this issue, that is, moral hazzard, that can be translated in “too big to fail”.

Normally, a capitalistic system follows the rules of natural selection: once the firm is no longer “viable” (that is, does not generate value), it exits the market. Is the fear of this expulsion (thus the fear to lose the job) that makes entrepreneur, manager and employees keen on doing their job of evaluating risks and opportunities. What if you could limit and sterilize this threat?

The too big to fail issue allows managers to take more risk, as they know that, since the firm/bank has a lot of employees, is crucial to the system etc, in case of problems the government would come to resucue them.
An example of this behaviour could be seen at the beginning of the crisis, when he US government bailed out Bear Sterns: this bailout poured an idea of “invulnerability” into the market (I’ve written about that here ), that would eventually been shocked by lehman’s bankruptcy (an U turn by the government: why letting lehman go and not bear?).

So, politicians,you know your enemy, because you’re alsoo part of the enemy’s troops. You know that touching the incentives schemes will bring to nothing.Take care of the moral hazzard issue, And show us that you’re really willing to change (hello Obama?)