Let's Pay Bankers in Toxic Assets: Farrell

Bankers that created toxic assets like subprime-mortgage derivates should be paid in those assets instead of cash, which will bring about a more transparent and less reckless Wall Street, Vince Farrell, chief investment officer at Soleil Securities, said Monday.


"The investment bankers who came up with all this toxic stuff should get paid with what they created," Farrell told "Worldwide Exchange." "Why don't you have them get some of this paper?"

"If your own self interest is on the line, you might be a little more careful of what you trade," Farrel said.

If the bankers were paid bonuses in toxic assets they would have to figure out what the paper is worth today and that would start to clear balance sheets and get the financial system back to a more normal state, he said.

Jim Rogers, chief executive officer of Rogers Holdings, agreed with Farell's assessment.

"You can get rid of them (toxic assets) by giving them bonuses to bankers," Rogers told "Worldwide Exchange." "Most of the toxic waste came from the bankers, let them have it. Pay regulators in toxic assets as well."

Looking at the landscape a year after the collapse of Lehman Bros., not much has changed, Farrell said.

This Day 1 Year Ago - A CNBC Special Report - See Complete Coverage
This Day 1 Year Ago - A CNBC Special Report - See Complete Coverage

"It seems like we're kind of back to business as usual," he said.

While "that's not all bad" and the capital markets have improved, there's not a lot of fundamental change and "I think we need some fundamental change," Farrell said.

There is a concern that without that change more big failures could come and could come at an accelerating pace, he warned.

  • Watch the full interview with Vince Farrell here >>>