Should the government set or limit the compensation corporate executives receive?

The short (an incomplete) answer is no. The government should not be in the position of capping or limiting the salaries of corporate executives.

That is inconsistent with a free enterprise market system.

However, we don't have a free enterprise market system when key companies (investment banks, for example) are deemed "too big to fail."

Add your thoughts in this reader comment section.

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Most companies don't get into financial trouble overnight - there are signs.

One of the better signs is the cash flow to debt ratio.

This ratio tells you how well a company can cover its debts from cash flow.

A low number is bad news. Here's how it works.

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The stock market has been on a roller coaster and there's a good chance it's not getting off anytime soon.

Good news on the jobs front along with some better than expected earnings sent the market up Thursday, but that follows a down day that struggled with uncertainty.

Investors are looking for a reason to buy, but reality keeps biting them in the butt.

And that reality is true unemployment (combining the jobless numbers with workers on reduced hours or otherwise working for much less than before) is staggering.

A vast majority of business economists recently predicted it will be at least two and, quite likely more, years before the unemployment situation is resolved.

That means in the short run it is unlikely that consumer spending will return with any strength.

Without increased consumer spending, business spending will not grow enough to create the jobs we need to ease the unemployment crisis.

Remember, we not only have to replace lost jobs but must also create jobs for young people entering the work force every year.

This is why the stock market charts are likely to look more like the Swiss Alps than an airliner taking off.

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When Warren Buffett speaks (and, more importantly, acts) the stock market listens.

The market may not always follow his moves precisely, but you can bet many in the stock market note whether he is bullish or bearish.

He is definitely bullish these days with the acquisition of Burlington Northern Santa Fe railroad - a $44 billion investment.

Some pundits have labeled the move a "bet," but Buffett doesn't bet.

Every move he makes is well thought-out and, for the most part, geared toward a long-term investment.

Why is his acquisition of a railroad important?

Transportation stocks (railroads, trucking firms, but not necessarily airlines) do well when the economy is strong.

They suffer when the economy is bad and there are fewer goods to move around.

Buffett's acquisition of a railroad is testimony to his confidence in the U.S. economy. Transportation, including railroads, will see increased traffic as the economy grows.

He has become the most successful investor in history by buying where others failed to see long-term potential - in other words, Buffett is a value investor.

Too often these days, stock investors hear that long-term investing is a losing game - that market fluctuations will wipe out any gains.

Buffett reminds us again that a long-term perspective is still one road to investing success, but it is not a road investors should follow with their eyes closed.

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