November 08, 2011

Coin-flipping chimps and 1 percenter jobs

Michael Tomasky notes that, per Daniel Kahnemann, Wall Street traders are, on average, no better at picking winners than average, or than coin-flipping chimps. And, that's part of how this rentier class is wealth destroyers as much as wealth creators.

Since they do no better than average, it's arguable that boards of directors do no better than average, either.

So, why not fire every current board member of every Fortune 1,000 company, and replace them all with currently unemployed people? These board jobs often pay $50,000 a year or more, so they'd be real money for the unemployed. And, we're talking about 10,000 or so jobs.

Not a huge difference-maker in unemployment, but, if BOD members are as worthless on corporate strategy, on average, as traders on Wall Street, it couldn't hurt America's companies.


Anonymous said...

uh- because then you'd just have another group of guys without jobs maybe?

Gadfly said...

But, if they really ARE that valuable, then other Wall Street/Fortune 500 firms would put them on the regular payroll! And, if not, they'd have a day job in addition to the cushy board sinecure anyway.