Summers to Big Banks: Why Cash for Bonuses, None for Lending?

Complete video at: http://fora.tv/2010/01/29/The_US_Economic_Outlook_with_Lawrence_Summers

Lawrence Summers berates big banks for the hypocrisy of handing out large corporate bonuses while reducing lending and protesting government fees. "I don't understand how you can logically maintain that paying out bonuses in large quantity has zero effect on lending," he says.

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The economic outlook for the world's largest economy remains uncertain with unemployment levels reaching 10 percent and budget deficits increasing at the national and state levels. How will the Obama Administration address these and other economic challenges in 2010?

Lawrence H. Summers, Director of the National Economic Council talks with journalist Charlie Rose about these and other pressing economic questions. - World Economic Forum

Lawrence H. Summers is the Director of the National Economic Council. He was appointed by President Barack H. Obama on November 24, 2008.

Until January, he was the Charles W. Eliot University Professor at Harvard University. He served as the 27th president of Harvard University from July 2001 until June 2006. From 1999 to 2001, he served as the 71st United States Secretary of the Treasury following his earlier service as Deputy and Under Secretary of the Treasury and as Chief Economist of the World Bank.

Summers has taught economics at Harvard and MIT. His research contributions were recognized when he received the John Bates Clark Medal, given every two years to the outstanding American economist under the age of 40, and when he was the first social scientist to receive the National Science Foundations Alan T. Waterman Award for outstanding scientific achievement. He is a member of the National Academy of Science and has written extensively on economic analysis and policy publishing over 150 articles in professional economic journals.

Lawrence Summers received his B.S. from MIT and his Ph.D. in economics from Harvard.

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[SimplyStupidNews]

because its a legal way to Rip off the bank profits before investors see the stock profits, give out bonus's

[MishuTaste]

Would it kill some of you bank executives to actually EARN your bonuses?! And another thing: I don't understand why you bankers won't settle for a re-financed mortgage w/ lower payments instead of taking back a house that will remain empty until the housing market picks up again. Some money is better than no money.

[blackiron60]

What a hypocrit - a fat capitalist trying to convince us that he somehow doesn't know how his own economic system works and has worked for a long time.

[willb128]

Everyone is a communist now a days

[italianchappy]

just to make you know it. If I click on your channel youtube says:

"This channel is not available in your country"

[agfigueroaa]

No idea, Sir.

[dlucas90]

That little film was a big eye opener for me too. It also explains why our unelected bankers ultimately have more power than the politicians that pretend to work for us but really work for the central bank. After all, congress can pass what ever goofy program they want but it won't mean a thing unless it can be financed and who decides that?not congress, they unconstitutionally gave the power to issue credit to the newly formed central bank, aka FED reserve in 1913. The $ lost 98% since then.

[BrutusBlackest]

@dlucas90

I mean, speaking in a strictly pragmatic sense here, it is genius. In essence, we borrow imaginary money, at interest. Which means,eventually a particular subset of society will have the VAST MAJORITY IF ALL MONETARY RESOURCES...vast majority...of all...monetary resources. One, small, elite, tiny, banking,oops, resourceful subset...

[dlucas90]

............ 3, only the money for the principle of the loan is ever created, the money for the interest payment is never created and is therefore not in the money supply, causing ever bigger loans to always need to be created. "growth"

[BrutusBlackest]

@dlucas90

I agree. That little film scratched an itch I'd been having since I was 16 or 17. Namely, if this paper printed dollar is the exact same paper printed dollar as I had yesterday, what causes the value of it to fluctuate? Creating debt out of thin friggin' air does! The gold standard replaced by a national debt limit. Come on guys, I don't want to skip on my way to the slaughterhouse. Let's right this thing.