James Grant understands Wall Street

James Grant has been a keen observer of the financial markets for decades.  Bloomberg Radio did a brief interview with him, excerpts of which were printed in the October 2008 issue of Bloomberg Markets magazine.  For those who couldn’t understand how so many smart people could act so recklessly, creating our financial mess, consider Grant’s insight:

“Wall Street firms are not really businesses as we know business.  They are not in a pharmaceutical trade.  They’re not in the metal fasteners line.  They are in the business of generating bonus revenue for themselves.  That is their line of work.  And to do this, they take extraordinary risks with astounding amounts of financial leverage.”

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