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Leopards and Their Spots

According to the Wall Street Journal, some of the nation's largest banks are still employing the same dangerous business practices that caused the recent financial crisis. Only now, they're trying harder to cover their tracks.  

Attempting to protect their stock prices and credit ratings, big banks have been temporarily lowering the debt levels they use to fund securities trades. For the past five quarters, institutions including Citigroup, Goldman Sachs, Bank of America, and J.P. Morgan Chase, lowered their debt levels an average of 42 percent just before releasing financial results to the public. Then, according to data from the Federal Reserve Bank of New York, those banks promptly restored their risky debt levels in successive quarters.

While technically legal, the practice misleads investors about the amount of risk the banks are actually incurring.

It's important to note that this deception has been going on for fifteen months, roughly the same amount of time our tax dollars have propped up these companies' battered balance sheets. Obviously, the people who run these institutions have not learned from their mistakes or made any efforts to change their misguided ways.

Clearly the banking crisis is, in fact, a leadership crisis.

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You said that "Clearly the banking crisis is, in fact, a leadership crisis." I'd add the caveat that the banking crisis is a MORAL leadership crisis.

A moral leader doesn't dissemble, obfuscate, hide, or deceive. They don't play with words and say things like "we'll pay all legitimate claims" knowing they'll fight forever over what is legitimate.

Thanks for pointing out these leopards.

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