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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (99726)	7/17/2009 7:02:10 PM
From: axial	1 Recommendation Read Replies (1) \| Respond to of 116555

Skeeter, apologies: I omitted the link to the original post... Message 25432905 "... The premise is that the highest compensation draws the best players. That may be true in athletics, where the measurables are easy to define. But even in athletics, a top player's compensation is no guarantee of the team's success - and what we're looking for in business and finance is team success - aka success of the enterprise. We want good teams - with good stewardship. We want longevity - to see them in the playoffs every year. We want a good farm system, and good coaches. We want foresight, vision, prudence and aggressiveness - all in balance. ... Overcompensated players across the spectrum of commerce and finance have taken large numbers of vital enterprises down. The main driver for sub-par performance and risky behavior has been - you guessed it - increased compensation. We've created incentives for increased compensation, which in turn creates incentives for risk-taking. If the risk-taking fails, we pay anyway. Meanwhile, across the economy we overpay for mediocrity.The visionaries - the successful entrepreneurs - never prejudice the success of their enterprises by the effect of their compensation: enterprise first, compensation second. But few of these "stars" started anything. They're just hired help in companies whose existence predates them, and will continue after they're gone - if they don't wreck the company, as many have." Jim