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I keep hearing discussion of moral hazard in insurance terms relating to the financial markets, but no-one mentions the biggest moral hazard, that bankers and executives are being paid to do deals -- period, regardless of overall quality. So if they sell a lot of overpriced debt, mis-rated, or push an M&A that is a loser for the companies involved, or a buyout that simply asset strips and then IPOs a company with long term problems they "make out like bandits." There is a moral hazard, doing lousy deals gets you payed, maybe more than if you did a good deal, and certainly its easier than finding a good deal to sell...
