In this week leading up to the holidays, both big guys and little guys have taken a bruising.
First, the government sued six former executives at the lenders Fannie Mae and Freddie Mac for downplaying the risks of subprime mortgages. Officials at the Securities and Exchange Commission said it was part of a renewed effort to ferret out wrongdoing at the highest levels of corporate America.
The government also flexed its muscle again in its antitrust department, knocking down AT&T's attempted takeover of T-Mobile. The Federal Reserve even asked banks to shore up their own bank accounts to help protect against another financial crisis.
To our government's revived interest in policing the excesses of corporate America, we say, Better late than never! (That maxim may also apply if Congress ends a practice that's been, up until now, hush-hush: Congresspeople helping hedge funds make a killing.)
But just as the big guys took hits, so did the little guy. Well, almost. This week, Congress put extensions of the payroll tax cut and unemployment benefits in peril, only to resolve their standoff in the 11th hour. No doubt the 162 million Americans whose wallets could have been hurt by their stubbornness didn't find the impasse conducive to holiday cheer. (Read about it in-depth.)
We also got a look at how little guys suffer when we saw a chart comparing economic performance in destitute North Korea to its wealthy neighbor to the south ... and that got us thinking about the ways in which the U.S. could learn from South Korea.
This week, we bring you these three stories taken from the news:
The Drama Over the Payroll Tax Comes to an End ... For Now
For two nail-biting days, the fate of the tax breaks and unemployment benefits that help 162 million was up in the air. Find out why—and how it was resolved.
Hedge Funds Insist Congressional Information Isn't Insider Trading
Hedge fund managers are finding out legislative decisions hours before the public and making market trades based on that knowledge. And the practice is legal.
What the U.S. Can Learn From the Koreas
North and South Korea started in the same place 60 years ago, but South Korea is now one of the world's largest economies. It even has lessons for the U.S.