Wall St. And The 800 Lb Gorilla in the Room

October 10, 2008

I am stepping out of my area of expertise. So I am free to enter in ignorance.

But just about every media outlet around the world is fixated with the executives of the organizations in the current Wall St. melt down doing the perp walk to congress.

Anderson Cooper on CNN even has his version of the US Army’s Iraqi playing cards in a ‘Most Wanted’ type format. Just lined up for these exec’s.

The only note that I have seen that even obliquely mentions the 800 Lb gorilla is the Short Termism mention by 1 to 1 Media here.

To me it seems pure classical conditioning.

Like Pavlov’s Dogs you learn what bell to push to get the treat.

Option A results in punishment

Option B results in reward

This classical conditioning can be fueled by the institutional investors that figure it is their god given right that a dollar invested today needs to be two dollars by the end of the quarter.

Not next year, or five years, but three months from now.

I personally like defining most of these institutional investors in the term used by Clayton M. Christensen, Stephen P. Kaufman, and Willy C. Shih in the Harvard Business Review.

They call them shareowners,  not shareholders.


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