Feinberg's task was difficult, but he wielded more of a loofah than a whip. And the idea of the Fed Reserve Bank's stepping in to regulate compensation at banks is little more than fancied-up self-regulation by the banks. By its nature, the Fed is not much of a regulatory agency except in macroeconomic matters. Just look at the board of the New York Fed: It includes such "regulators" as JPMorgan Chase CEO Jamie Dimon, plus GE CEO Jeff Immelt and Pfizer CEO Jeff Kindler. They'll keep those Wall Street execs in check.

It will affect 175 execs at seven firms. Whoop-de-do. Execs and their representatives were in on negotiations, and the result may assuage public outrage. But Feinberg's action will be no more effective in the long run as a cure for excessive greed than a kiss on your bruised knee from Mommy. Sure, it feels good that someone cares, but it doesn't really help.

Best take so far is from the WSJ:

Morgan Stanley CFO Colm Kelleher somehow kept a straight face when he told a Dow Jones Newswire reporter, "We always said 2009 was a year of transition, and what you're getting is a validation of that."

Translation from Streetspeak: "Year of transition" means "business as usual" and "validation" means "profits so big I think I'm going to shit myself."

The WSJ story on this matter notes that Morgan Stanley's risk-taking is paying off, just as it already been at Goldman Sachs. Morgan's just now trying to catch up, being slow on the profit uptake during this year's market rally. Nevertheless, as DJN's Gabriella Stern points out:

The conventional wisdom in pro sports is that if you're paying a star big money then you have to play him. Otherwise, you're wasting your investment.

Not so in the current case of Cleveland Browns quarterback Brady Quinn, whose benching will cost him millions of dollars in lost performance bonuses. For more on Wall Street performance bonuses, plus a brief comparison between bonuses on Wall Street and in the NFL, see this WSJ story.

By the way, click on the above video and you'll see that Quinn couldn't even get any sugar from his girlfriend during draft day. Poor guy. He's not suffering as much as the average Cleveland resident, but still ...

While the rest of us may turn to drugs to combat the recession blues, the global meltdown has forced bankers shorn of their bonuses in London's cocaine-laden financial district to cut down on their snorting. See Bloomberg's "Cocaine Survivors Losing London Bonus See End to Bubble's Binge."

If you're not too fucked up on drugs, follow this reasoning: So if the meltdown has actually contributed to a victory in the "drug war," that's all the more reason to not continue bailing out Wall Street or allow the banks either here or in London to resume paying big bonuses.

Is the tide turning for the public option? (Salon)

"As healthcare reform moves to backroom talks, supporters say its chances may be improving."

U.S. Losing Ground on Preventable Deaths: Despite High Medical Spending, Results Trail Other Wealthy Countries (WashPost)

Pay Czar Targets Salary Cuts (WSJ)

Ken Feinberg might actually be planning a crackdown. Instead of cash, execs would have to take stock that they couldn't fuck with for several years. "Most intrusive [move] yet into corporate compensation."

Obama Weighs Spending to Stem Job Cuts Without Second Stimulus (Bloomberg)

Or at least without something that carries the label "stimulus." More gullible NYT story here.

One-Third of Wall Street Workers Expect Bigger Bonus This Year (Bloomberg)

U.S. Seeks to Restrict Gift Giving to Bloggers (WSJ)

Cracking down on the shilling of products "for fun and profit." Bloggers supposedly have to reveal freebies or money they get for writing product reviews. Also cracking down on celebrity endorsements.

Recession Spells End for Many Family Businesses (WSJ)

The ones that Wal-Mart and fast-food chains hadn't already killed.

Google to blight smartphones with big ads (Register U.K.)

Prepaid, but Not Prepared for Debit Card Fees (NYT)

Yet another legal scam foisted upon a recession-plagued public.

Comedian pitches $100k for Twitter account: Drew Carey eyes @drew for charity (Register U.K.)

If you're willing to pay $100,000 to outbid Drew Carey, then you have too much money. Cancer becomes a Twitter game.

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U.S. Job Seekers Exceed Openings by Record Ratio (NYT)

Hedge funds recovering, mergers and acquisitions are starting up again, the big banks are frantically trying to figure out how to spin their impending resumption of big bonuses. Meanwhile, "the job market is bleaker than ever in the current recession."

Trustee Plans to Sue Madoff Family Members for $198 Million (NYT)

Sharp Drop in Start-Ups Bodes Ill for Jobs, Growth Outlook (WSJ)

"U.S. stock futures are pointing toward a higher open, rebounding modestly from the market's worst week since early July."

No reform, just a cosmetic patch (Telegraph U.K., Liam Halligan)

A pox on the G-20, at which "the lack of questioning of the status quo was spectacular." Halligan notes: "Obama's oratory was typically impressive. The trouble is, it wasn't true. ... Nothing 'bold' was done to lessen systemic dangers or overhaul the global regulatory regime."

The Curious Case of the Nets' Ownership ((WSJ)

Russian oligarch's pending purchase of New Jersey Nyets continues an odd, tragicomic history of ownership of the franchise that once boasted Dr. J. Funny little story by Brad Parks notes that Bruce Ratner, who bought the team in 2004 for $300 million, wound up spending about $1.5 million per win.

Profits Poised to Surprise Again (WSJ)

Even bears are optimistic about impact on market. "One big reason for the market's continued strength is that expectations were so low for the economy and corporate earnings that the market was able to rise even on modestly good news."

`Black Swan' Author Taleb Asks Why Bernanke, Geithner Still Holding Posts (Bloomberg)

Nassim Taleb tells biz leaders in Hong Kong: "Bernanke, Geithner and Summers didn't see the crisis coming so why are they still there?"

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Hey buddy, can you spare a prepaid debit card? (Salon, Andrew Leonard)

Trite headline masks a fascinating story on the (legal) scam of companies' giving you rebates in the form of pre-paid debit cards. The always useful Leonard points to a March story about the ubiquitous Andy Cuomo's fight against them and offers other useful links.

Judges' Frustration Grows With Mortgage Servicers (NYT)

Federal judge in Phoenix hauls a high-ranking Wells Fargo exec to court and forces him to be grilled under oath by an average homeowner about why the hell the bank won't respond to her application for a loan modification.

Lehman Brothers Failure May Have Saved Us All (WashPost, Steven Pearlstein)

"Lehman's failure may have sped up the process by which all this lousy lending was revealed and the losses acknowledged, but the financial reckoning was inevitable."

Football, Statistics, and Agency Problems

Winning strategy: Don't punt. Same goes for financial sector. Points to study "Do Firms Maximize? Evidence from Professional Football."

The Unwitting Birthplace of the 'Death Panel' Myth (WashPost)

LaCrosse, Wisconsin — that's the place. Good story explains why.

NO PITY FOR CITI: US WATCHDOG BLASTS BANK'S LACK OF BAILOUT EXIT PLAN (NY Post)

However, Citigroup is believed to have a bonus system ready to go.

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Credit card issuers boost rates ahead of tougher rules (L.A. Times)

Banks "are getting their shots in while they can," says a prominent observer. More: "For the three months that ended June 30, U.S. households on average carried a credit card balance of $7,987, down from a high of $8,529 in the third quarter of last year, according to Moody's Economy.com."

The Coming Recovery Will Most Likely Not Be Robust (Seeking Alpha, Tom Lindmark)

Parsing IMF Chief Economist Olivier Blanchard's prediction that the Great Recession has permanently damaged economic growth.

Time Warner, YouTube Reach Video, Ad Rev Agreement (WSJ)

Small picture: Google on the march to make its YouTube unit show a profit. Big picture: Latest in a series of pacts that will allow advertisers to make big footprints on the Internet. (See also "YouTube Pumps More Ads Into Lineup.") Bad news for network TV; great news for bloggers looking to spice up their sites. Even better news: Adult Swim clips will be available on YouTube.

US Life Expectancy Reaches All Time High (Medical News Today)

Is that good news or bad news? We're up to nearly 78, so we'll be even crankier for even longer and will cause more traffic accidents. We'll also require more health care for longer, and you'll have to pay for it.

Princeton, Harvard Share Top Spot in U.S. News College Rankings (Bloomberg)

Meaningless ratings (except for the huge PR value) by the ailing U.S. News & World Report yield the usual suspects. This account by Oliver Staley is an unusually thorough look at a highly (and humorously) flawed process during which schools are increasingly accused of "manipulating" their admission policies to impress an increasing irrelevant news magazine. More scary is that colleges are now judging prospective students by their "personalities," as the WSJ reports. (Mark me down for a trade school.)

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Stocks Drop in Global Pullback; U.S. Economy Is Still Sputtering (WashPost)

Reaction from one investment strategist: ""Whether it's the facts catching up with the expectations or the expectations catching up with the facts, I'm not sure which." You can those words to the bank. WSJ speculation, Telegraph (U.K.) on fears that rally's over; Seeking Alpha's The Mole on the bear.

Foreclosures Rise With Unemployment Rate (WashPost)

"The country's growing unemployment is overtaking subprime mortgages as the main driver of foreclosures, threatening to send even higher the number of borrowers who will lose their homes and making the foreclosure crisis far more complicated to unwind." In the first quarter, prime foreclosures outnumbered subprime ones.

Squeaking by on $300,000 (WashPost)

Droll profile of one Laura Steins in ritzy NYC suburb Harrison: "[S]he's months overdue for a visit to her colorist, a telltale sign of economic distress for a woman such as Steins."

Fox News on pace for best year ever (AP)

Sailing on its swift boat with its three Gilligans — little buddies Bill O'Reilly, Glenn Beck, and Sean Hannity — Fox has seen its viewership rise 11 percent from last year. CNN and MSNBC are down.

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