At Last - A Worried Corporate Executive Goes Public

Ken Langone is a co-founder of Home Depot, a corporation that made the neighborhood hardware store into a "home improvement center" of Wal Mart proportions. Today Mr. Langone was interviewed on video by Bloomberg.com. Besides the usual platitudes, there were some interesting comments made about the US economy.

Mr. Langone thinks the Federal stimulus package is an "enormous waste" that the gov doesn't  "know how it's going to pay back". He fears that the nation may lose it's credit standard, which will cause the country  "deep trouble". < Heh, an understatement if I ever heard one. >.

According to Mr. Langone, there is a "disconnect" between people he knows and respects as business persons, and the propaganda emanating from the government and media. Basically this disconnect is the gov saying everything will be fine, while Mr. Langone's business friends say everything is getting worse each month.

A simple indicator of this, according to Mr. Langone,  is that 38% of the American public are terrified of losing their jobs. He thinks this is much more ominous then the unemployment figures which he calls "peanuts". < Perhaps he should talk to some of those currently unemployed and homeless to ask them how insignificant they feel. >

Mr. Langone thinks this fear of job loss is terrifying these same people from making any purchases other then necessities. Like, for instance, many of Home Depot's products.

He summarizes this information disconnect between the public and private sector, by saying that if corporation executives made  outlandish statements like the politicos, they'd be going to jail for fraud and misrepresentation.

Well said, Mr. L.

Unfortunately, Mr. Langone then continues the interview by defending Ken Lewis's role in Bank of America. Guido has different memories of BAC, none of them complementary. For example, the time Guido went to BAC to cash a check from this dead beat who had an account with Bank of America. The bastards charged me $5 to cash their own check. This is probably in violation of banking regulations, but like I've said before on this website, banks think that they're above the law.

Then there is this real estate lady I know, who had a line of credit with BAC and a perfect credit history < She had a habit of paying her loans off early. > Recently,  Bank of America was gracious enough to summarily cut off this line of credit with no explanation at all.  Perhaps BAC is strapped for liquidity and can't make any more loans? Or perhaps, they think real estate is too risky at this time? Whichever the reason, you can be sure the investment banking division at BAC will tell you the economy is fine, and now is the time to invest before it's too late.

Yeah, sure. I believe that.

"A bank is a place that will lend you money, if you can prove you don't need it." - Bob Hope

< This is one reason why Bernanke is such a comedian. He never listened to Bob Hope. Instead, Doc Ben just threw out a few trillion dollars to the banks.  This went nowhere and stayed with the banks. If you think that's funny, just remember. You're paying for it. >

< As usual, this article is for information purposes only. It is not a recommendation or investment advice. >