Blame The Incentives!

Earnings, IPOs, and the like

from the so-that's-the-trick dept

Here’s an article with a different (and possibly correct) take on the whole “who to blame” question that everyone has been having so much fun with these days. Instead of blaming the analysts who kept pumping up stocks and pushing for IPOs, blame the incentives that encouraged these analysts to do so. The analysts never had any incentive to really look carefully at all the companies they were promoting. They did have plenty in the way of incentives to pump up stocks and keep pushing more companies through their firms’ IPO pipeline.