Aug 21, 2009
More on Bankers' Bonuses
Jamie Whyte explains why it is wrong to target bankers' bonuses.
"The financial crisis was caused not by bankers' incentive plans but by a systematic failure to price risk correctly. Without accurately priced risk, there is no way of giving bankers the right incentives, however long the period over which their performance is measured. And with accurately priced risk, there is no incentive problem to be solved."
"The financial crisis was caused not by bankers' incentive plans but by a systematic failure to price risk correctly. Without accurately priced risk, there is no way of giving bankers the right incentives, however long the period over which their performance is measured. And with accurately priced risk, there is no incentive problem to be solved."