Mortgage Mess--Heads I Win; Tails You Lose

Today's post is my 4^th suggestion/solution for keeping the Mortgage Mess from ever happening again and the Word for today is...accountability.

We must hold the executive leaders of financial firms and their boards accountable. I believe the board of a company should be more involved in oversight of the executive leaders of the firm and be held accountable for this oversight. Second, the President, CEO, CFO, CIO, etc. should not be allowed to select any board members for whom they work for. No more YES MEN!

Next, we must prosecute the villains at these firms to the full extent of the law and no more slaps on the wrists with fines only. For example, Franklin Raines, former President/CEO of Fannie Mae and other former executives recently paid a $24 million fine; but they are free to do it again. They perpetuated a $9.3 billion accounting scandal and all that happens to them is a fine?

Heck, if I as a Mortgage Broker committed a serious financial crime I can lose my license and my ability to make money, be fined hundreds of thousands of dollars (which is more than my net worth currently), and be thrown in jail. Why the heck is Mr. Raines able to advise Senator Obama on financial and housing matters as a free man and not be in jail? It ticks me off!

Third, we as shareholders of all companies must fight back on golden parachutes. I have heard argued that without golden parachutes CEO's and other executives would not take any risks. Hogwash! Under the current system, either way THEY WIN! IT'S HEADS I WIN, TAILS YOU LOSE!

If a CEO grows the earnings and the value of a company they win through stock options and bonuses. I have no problem with this as they earned it as they helped the company and its shareholders make more money.

But, if the company's earnings drop or its value drops, these CEO's still win when they "resign" through their golden parachutes, in which they receive tens of millions of dollars or more. This is wrong! This is how they win either way.

I will end with this idea from Dennis Miller in September when he appeared on Bill O'Reilly's show on Fox. Dennis said we should give all these CEOs actual parachutes made out of gold and then take them up to 30,000 feet and force them to jump out of the plane. That's my kind of golden parachute!