I currently manage a medium sized hedge fund (long/short equity).
The current populist uproar is absolute insanity. I don't know how else to say it. You are never going to legislate away greed. Period. It is part of the human psyche. That's all there is to it. You can either fight it, or use it. Incentives work. This is why.
You must read this, all the way through. I don't know if the guys is for real or not, and do not care. The ring of truth is good enough for me.
It's depressing to read some of the comments on his posting. While many of them are supportive and many more ask good questions, there are far too many that are simply stupid--poseurs who want to appear knowledgeable while having no knowledge at all.
Sort of like Barney Frank.