Banks Gone Wild - New York Times:We've known about this problem for over ten years.
...But if the success turns out to have been an illusion — well, they still get to keep the money. Heads they win, tails we lose.
Not only is this grossly unfair, it encourages bad risk-taking, and sometimes fraud. If an executive can create the appearance of success, even for a couple of years, he will walk away immensely wealthy. Meanwhile, the subsequent revelation that appearances were deceiving is someone else’s problem...
The best explanation I've heard is that shareholders think they can get out before the stock craters, so the fundamentals are much less important than the share price.
The shareholders are wrong of course, but we are dealing with barely sentient primates after all.
Do we need to be looking at alternatives to the publicly traded company?