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10 Economics - c mark-to-markey accounting book profits the...

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5/12/10 Economics History 1. Aristotle a. believed the accumulation of money does not satisfy any need b. sin to be in the business of loaning money 2. John Keynes a. Can Capitalism regulate itself? b. Did not believe the laws of the market were enough to stop the Great Depression c. Government should step in and help stimulate the economy when needed d. Proposed a Fiscal Policy, that allowed the government to intervene with “automatic stabilizers” e. Automatic stabilizers: retirement, progressive tax (people who make more pay more taxes) 3. Economics Contribution to Crime Prevention a. Keynes did not anticipate corporate scandals b. Sarbanes-Oxley Act came from the Enron Scandal: companies have to have independent audits to make sure everything is correct, which is overseen by the government
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Unformatted text preview: c. mark-to-markey accounting: book profits the day the deal is signed d. rank-and-yank: rank employees and let go the ones at the bottom go e. When Bethany McLean broke the story about the Enron Scandal, Enron responded by saying she needed to do her homework 4. Enron Scandal Lessons a. Success does not equal excellence b. “Turbo incentives” require turbo controls. c. Performance oriented culture d. Lesson: the importance of humility and self-assessment e. need good character and competence f. culture at Enron:greed, competition, ignorance g: culture at NASA: absence of trend analysis, concerns not voiced, information overlooked...
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