Tuesday, October 12, 2010

Wall Street's Record Breaking $144 Billion Bonuses

Wall Street is having another record breaking year ... in handing out bonuses. Is that a record we actually want them to break? Hell, no!

What happened to the notion of the person who makes the decisions bearing the responsibility for those decisions? If I am a small business owner, and I mismanage my business, I don't get paid. Why doesn't this same, simple idea apply to Wall Street Executives?

They gamble with our money, yet the investors and taxpayers are the only ones on the hook to cover the losses.
Wall Street pay is on pace to break a record high for a second consecutive year, according to a report in Tuesday’s Wall Street Journal.

Some three dozen top banks and securities firms will pay $144 billion in salary and benefits this year, the paper said. That’s a 4 percent increase from the $139 billion paid out in 2009, according to a survey conducted by the Journal. Compensation is expected to rise at 26 of the 35 firms surveyed, including banks, investment banks, hedge funds, money-management firms and securities exchanges.

The report shows revenue is expected to rise at 29 of the firms, but at a slower pace than pay. Wall Street revenue is expected to rise 3 percent, to $448 billion from $433 billion, despite a slowdown in some high-profile activities like stock and bond trading. Wall Street is expected to pay 32.1 percent of its revenue to employees, the same as last year, but down from the 36 percent paid out in 2007, the Journal said.

Profits on Wall Street were depressed by losses over the past two years, but they have bounced back from the 2008 crisis, the paper said. Even so, this year’s estimated profit of $61.3 billion for the firms surveyed still falls about 20 percent short from the record $82 billion made in 2006, the Journal said.

Large Wall Street banks are unlikely to accelerate bonus payouts, however, to help their employees avoid the higher tax rates that may be coming when tax cuts enacted by the Bush administration expire on January 1.

Paying out bonuses early would likely be a public relations disaster for a sector already blamed for the economic downturn, compensation experts noted.
Where is the bonus for the homeowner losing their home? Where is the bonus for the small business owner, the backbone of our economic recovery? Where is the bonus for the person who makes their payments on time every month, but still can't manage to get ahead?

The excesses of Wall Street Executives is obscene. Where was the oversite on this when Congress and the President (Obama and Bush) gave these corporations our taxdollars in bailouts?

Will we ever get answers? I doubt it.

UPDATE: Here is more about the greedy bastards!

Wall Street Executives clearly would like to see Republicans take over the Congress. Is there any question about why?
In a question about which two issues the Republicans should focus on after the elections, nearly two-thirds of respondents said extending President George W. Bush-era tax cuts should be a priority, while more than half said boosting economic growth should take top priority.
Good grief ...

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