The New York Times invited financial experts to submit questions that should be asked in the Financial Crisis Inquiry Commission hearings, beginning today. Officials from Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Bank of America will be grilled.
James Grant suggests the following question: Bankers are dealers in money. The Federal Reserve is a creator of money — since the crisis began in August 2007, it has conjured up $1.1 trillion. Given the ease with which these dollars are materialized on a computer screen, how can they be worth anything?
Financial blogger and former IMF official Simon Johnson asks some of the meanest questions:
1. Describe in detail the three worst investments your bank made in 2007 and 2008 — that is, those transactions on which you lost the most money. How much did the bank lose in each case?
2. What was the total compensation of each manager or executive supervising those three transactions — including yourself — in 2007 and 2008?
3. Are those executives still with your bank?
Yes, I think these are questions we would like to know the answers to. More here.