Geithner wants bankers paid in form "that can be clawed back"
U.S. Treasury Secretary Timothy Geithner proposed having bankers paid largely in stock, in a form that can be "clawed back" if the bank does not perform well. "You want compensation to come substantially in the form of equity in the firm that vests over time, that is at risk, that can be clawed back if returns don't materialize," Geithner told CNBC. The Obama administration is working to set guidelines for executive compensation at banks that received government aid, and those standards could be taken up by the entire industry. Bloomberg (11 Sep.)
*expect a big rally over this news
Lending, industrial output expand as China recovers
China's economic recovery is occurring faster than expected, statistics show. Industrial production rose 12.3% in August compared with the same month last year. New lending increased to $60 billion last month from $52.1 billion in July. "Policy stimulus is driving the recovery, and China is poised to get more support from exports in coming months," said Brian Jackson, senior strategist for emerging markets in Hong Kong at Royal Bank of Canada. Bloomberg (11 Sep.)
Wen indicates China will maintain stimulus efforts: Chinese Premier Wen Jiabao suggested that he will drive the country's recovery by maintaining the government's stimulus initiatives. "China's economic rebound is unstable, unbalanced and not yet solid," Wen said in a speech. "We cannot and will not change the direction of our policies when the conditions aren't appropriate. However, he did not offer any additional measures or spending programs. The Wall Street Journal (11 Sep.)
*are you surprised? Another reason you don't make any money? Congress takes it all...
Bill on tax related to mutual funds stalls in Congress
Legislation to eliminate an oddity in tax law that charges mutual fund investors for capital gains they do not actually take has drifted into limbo in the U.S. Congress. As the law stands, when mutual funds sell investments at a profit, investors are taxed on the gain, even if they leave the money untouched. U.S. News & World Report (10 Sep.)
*see why you never make any money in mutual funds? They buy now when they should have been buying back in March. Ijiots
Individual investors warily start shifting back into stocks
When the economic crisis hit equity markets with full force, a number of Wall Street analysts predicted that it would take years to lure individual investors back into stocks. That is not how it is working out. Investors are cautiously putting stocks into their retirement plans. Many never cashed out in the first place, deciding instead to hang on and ride out the downturn. The New York Times (10 Sep.)