After the most recent banking drama that we've been having, I thought it would be interesting for us to turn back the clock and revisit a bygone era of prior financial panics. This will be the beginning of a series of posts from various news sources. The purpose of this exercise is to see, that despite the passage of time, how we make some fundamental mistakes over and over again.
The first financial panic that I'm examining is the failure of Bodenkreditanstalt which later became CreditAnstalt. The following excerpt is from the New York Times dated November 15, 1929:
"The president of the bank employes' association demanded that the fortune of $7,000,000 which Herr Sieghart is alleged to have obtained, despite the collapse of the bank be confiscated for partial reparation of the losses of employes and shareholders in accordance with the bank's articles of incorporation."
Wow, leaving aside the way they spelled 'employee' back in 1929, you'd think this was straight from an article on the bonuses being doled out by AIG. By the way, $7 million in 1929 is the equivalent of $84 million in 2007. The more things change the more they stay the same. Touc.
Source:
- "Austria Bank Head Scored In Failure." New York Times. November 15, 1929.
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