BusinessWeek: January 11, 1993

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JUNK BONDS AREN'T THE PROBLEM--GREED IS

Your review "The biggest Ponzi scheme of them all?" of A License to Steal, by my son, Benjamin J. Stein (Books, Dec. 14), misses the point of the book. It also misses an important point about the world.

The book is not a history or evaluation of junk bonds in general. The book says that Michael Milken and certain other named individuals engaged in certain specific transactions, in violation of fiduciary responsibilities, using junk bonds as a vehicle, with the result that these individuals wound up much richer and large numbers of depositors, pensioners, and taxpayers wound up poorer. This account is based on years of research by the author, who is a lawyer and student of economics and finance.

These things either happened or they didn't happen. Your reviewer does not offer a shred of evidence that they did not happen. He says they could not happen because they would "defy logic."

We would be better off to recognize that such things happen, and consider how to prevent them, than to pull the covers up over our heads and act as if nothing did, or could, go wrong.

Herbert Stein

Washington
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