Sur la Banque

After the events of the last two years it should no longer surprise anyone that the captains of finance are completely unaware of "we little people." But it is astonishing how they manage to let really wonderful and obvious opportunities slip through their fingers.

Goldman Sachs announced that it has record profits and a tremendous, really tremendous, pool for salary and bonuses for its staff. Most of that will go to the top executives and traders, of course. First point: these folks deserve big bonuses. They figured out how to make a lot of money, and Goldman Sachs should want to keep them around, rather than lose them to competitors or have them leave to start their own firms. Of course, regardless of what they are paid, some staff will leave and some will start their own firms anyway (a logical argument could be made that paying them too much would provide the resources to leave or start new ventures). Second point: Goldman Sachs has let an enormous opportunity slip by, an opportunity to make money and to burnish their badly tarnished image.

These folks are in business to make money. They should set aside a billion dollars or two and create a holding company, owned by the bank. Use that money to set up companies in varied fields across the country, employing workers. Some may be highly speculative, other will be pedestrian. Some can be firms that they buy and expand. Soon the winners and losers will be apparent. Sell or operate the winners, sell or close down the losers. Repeat the process.

The key is to move quickly. This is the supposed advantage of private industry over government: the ability to move quickly, to get it done. My experience in business is that products or lines of business should be brought out as quickly as you can. The good ones are few, but work very well. You stop the bad ones. Repeat the process.

How does this help Goldman?
First, they get to make a great big deal about how they are putting people to work fast, honestly laying out the plan: winners get to keep running, losers get closed down. Second, they will probably get most or all of their investment back, probably with a profit. They get to say that they are doing some good for the community, and in fact it will be true. Not too shabby. And as the recession ends, they can wind down that holding company and get back strictly to their knitting.

Here are ideas:

• Alternate energy equipment distributor with branches nationwide
• High tech manufacturer of turbine blades (Just Blades) of all types
  
• Battery distributor / recharger / recyclers, perhaps with electric motor repair. Branches nationwide.
  
• Building dismantling company that recycles into new material, operating in decimated industrial cities
• Prefab Housing. The reverse of dismantling: a new low cost housing design that is intended to be expanded. Start with small structure, designed to add wings or stories as the family can afford it. Opposite of the McMansion, for a new age.
  
• Outdoor enclosure manufacturer for waiting areas: enclosures feature adverts, video, wifi/cell phone transmitters, easy to clean with heating or cooling as required.

All of these ideas potentially put a lot of people to work doing tasks that have to be done at or near the point of delivery, or where there is little advantage in outsourcing to far places. Do it all with no government involvement, just move fast.
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