Steve Syre

We go back to back -- doesn't like mantle Maris. This is like a big poppy and and man like daddy go to heaven for a couple of cups of coffee house on hotel idea. These -- the this is the home run kings and we talk about Steve sigh of baton for today clean up. Every day at this time we do a Boston business report with the Boston Globe Steve sire and today's edition of the Boston business report is brought you by TD BankNorth. -- remember of the FDIC you can stop by today for a safe high yield CD with TD BankNorth good money Steve Sayyaf.

Good morning and thought of myself as morbid Dustin Pedroia ecstatic.

I say I don't -- and above his weight -- way to go all these analogies. And yeah that you later c'mon let's. Thank you god he's great. You know you'd you know that -- this topic continues to hold center stage the it is really pushed the presidential campaign the sidelines budget and -- would talk about that. Early today and Steve. What EG take your body but I know you're reading and following things from a variety of sources using congress can get this done -- isn't going to get -- up with the extraneous items.

Well -- I'm not sure and I think it is -- important and sort of -- Paulson is publicly up on the hill beginning today and all the through tomorrow in hearings so. You know we'll see what happens there but that's. -- of the public show begins today in that respect that. You know what I was positive body and in terms of point that he still has been conflict with the administration let alone. Other factions the house and senate. Took things that stick out wanted this issue of this sort of you know putting a clamp on executive compensation the company is that the government has effectively helping out the other one is that. Trying to find our way to help individual homeowners know. Politically that it. Dissident. Viewed ultimately as something that's you know the fact that bailout bill of 2008 and and it does something for people who are struggling in their own homes. First -- one is the executive compensation that issue which. You know this is essentially in. The Chris Dodd in the Barney franks -- the world in the political fight with with with Paulson and often -- killed in this.

Did you think that they that voting public. That masses there are just overwhelmingly going to. A fall on that side I mean it just -- yeah.

You know for the first guy who's you know -- Wall Street executive was worth something in the range -- billion dollars when it was before we got involved in this mess anyway. You know did -- to hold onto that line and say that you know it's terrible it's it's gonna screw things up is is. That there is an element of truth to some of that but he's ultimately that's that's not -- line.

You don't usually on the guy you're swimming against the -- a stream of public opinion on this since then held a public opinion the public is is dastardly misinformed but on this one. Count me in I am just so furious and capitalist of the coal. But these twenty -- 805000. Million dollar bonuses. I'm telling you -- I don't see how successful book that the that the company might have been in a particular time those are ridiculous -- and at that thing that a bailout is going to come along because of some of the horrific mismanagement. And and we -- the -- getting by the way -- compensation and that's the end of western civilization throughout screwed you yeah gimme a break I get fifty guys in Dorchester who would run the place better than you did.

As Steve let me ask you this on the front page your paper this morning. Not only -- congressman but com. Talking about the various interest and they are not always act in St. here in Boston. Or for the center of knowing grants and talk a little bit about -- How we might be unique and for our listeners hear how this may all play out -- and come back home.

Well I'm not sure how unique we are likely but there are lots of different. Interest at work if you point out and they're all kinds of is being of financial capital they're all kinds of different. Financial companies here and there are lots of stuff is up for grabs right now and you know for example. You -- between mutual funds and banks and hedge funds is this is a big hedge fund -- And you know they have a big bullseye on the right now they don't want to give up anything in terms of secrecy in terms of about other issues is not that. Go off the rails but is big issue about. Temporary prohibitions against betting against shorting. A lot of stocks that they don't like but you know just one simple example you know is. Right now everybody's so afraid. Money markets that mutual fund itself being undermined financially. That very -- that this push where temporarily the federal government to ensure. Money market accounts well you know banks are going not so -- that not only you know our our money markets gonna offer rates that are higher than my deposit accounts but. Other gonna get insurance to hope for a from the government you know there's. Insurance is quite big selling point right.

I'm always going to get -- that's exactly right that's a big marketing advantage that the banks have -- as they compete against mutual funds who have more freedom from capitol. -- you -- about like.

This -- is simple example of how -- one type of company has pitted against another right now it's unclear. How it's it's gonna come.

it's fascinating there Steve. And and Tommy and I were talking about this during the break so may be from your perspective. Riddle me this. What is that going to look like up on Capitol Hill. Right this moment. And 247. -- Right up through next weekend they were in all weekend to no sleep. Those lobbyists the lobbyists for the hedge fund has got that a lobbyist for the bank's gonna collaborate it will just to be. Insanity. Seems to me because they're usually always on the same side.

You're not complaining that the lobbyists aren't getting enough sleep are you.

IPod and position for them to be.

At a top of the conversation I was talking about. That is to wish is that that that already had framed in terms. Remaining point two contention and the other was this sort of home ownership. Help element -- it you know this has a lot more. Problematic and then -- you know compensation -- and it's not that everybody doesn't agree that there are instances where. This is -- every once instances it is interest and let's do it but. It's that this is where it gets really complicated. And went. You know everybody's talking about that big number of the -- but how the bill that would actually work is still kind of a black box mystery and yet it. Critically what -- trying to do is get market morphing again and ultimately what it's gonna. -- by individual loans the -- turnaround -- border clapper said well you know. You'd you'd gotten trouble and and you know we bought your won't work. Sixty cents on the dollar because we've squeezed this bank and we're going to rewrite it. At seventy cents on the dollar and and we'll get our money back and and you'll be better -- yeah it's more complicated than that that is they're all right it will. More often than not what they'll be buying has pools of securities. That all of lots and lots of mortgages and that would be fine too if they control almost. Because they could do the same thing had a bigger scale but the truth is in many of these all that. There isn't one investors don't say I want to buy your security is that the poll is controlled by. Don't know 510 a 10500. Different investors and the government by buying these rules spices doesn't effectively. Control pool and you know so what you gonna do bad and not only is it just. A lot of people is that the poll itself is chopped up into different. Is that have to do with how much you're gonna take it if you have. You know shares of the rescue part Europe's financial interest are different than the the people on the conservative -- and so it just becomes that you know and that's saying what would get up by the securities all of a sudden. We're going to have this this you know way to help people stay in their -- it's going to be much more complicated the flip side which is something that existed. As this initial before the crisis that is still very much percolating and is I believe a big issue that point. What is the idea of allowing bankruptcy judges. Two essentially modify terms of loans were people who are losing their homes. In bankruptcy and saying here's a way to communicate here all by by lowering your payment by doing some other modification. Your mortgage and -- you know I think if you can figure is before these this issue of rewriting a mortgage that you followed everybody agrees with the in the financial interest. That's a win win if you go to bankruptcy court that's something different bigger modifying. Essentially an existing contract and if people in the future writing mortgages. Think well you know here here's my ideal but at this borrower goes bankrupt you know some judgment rewrite my ideal that that. That affects the long term safety and soundness of of the system that -- more.

own level of uncertainty absolutely no question about it. That's Steve I want to make sure that he not take an executive compensation is well I don't know what -- is as -- discredit but let's imagine an idea for the XYZ widget company. We're gonna IU is the CEO we're gonna pay two million a year. And their bonus performance benchmarks wow animators at 1015 media is long is XYZ widget company. Is not. Asking for expecting some type of government take over government bailout route either aptitude. All our lack -- Yeah the E it's nobody's gonna say anything about what we're -- sire right.

Now that I don't know if that's nobody's business.

Knowing that if they are on the iPod myths aside. -- SE guys I would think he does well Steve obviously we're gonna stay with this topic you know the fact that. -- so many competing interest is Roger pointed out it's a great front page story on the front page of the globe today you know my roster -- Kimberly Blanton. This is I'll get this accident a bit later about these are -- very legitimate interest that trying to make sure that they don't get forgotten loss watch.

And because as Steve says it's such a complicated issue or issues that even if you are even if you've got your doctorate in in finance macro economic. You're gonna be scratching your head on this one for a long long title.

Washed and Steve's site -- we will let you go look forward to tomorrow's report Boston business report with Steve's I remember today's version -- addition I should say the Boston business report with the -- Steve's site has been brought you by TD BankNorth. They remember of the FDIC. Stopped by today for safe high yield CD with TD BankNorth.