Category Archives: Wall Street Bonuses

Obama Doesn’t ‘Begrudge’ Bonuses for Blankfein, Dimon Update1 – Bloomberg.com

Feb. 10 Bloomberg — President Barack Obama said he doesn’t “begrudge” the $17 million bonus awarded to JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon or the $9 million issued to Goldman Sachs Group Inc. CEO Lloyd Blankfein, noting that some athletes take home more pay.The president, speaking in an interview, said in response to a question that while $17 million is “an extraordinary amount of money” for Main Street, “there are some baseball players who are making more than that and don’t get to the World Series either, so I’m shocked by that as well.”“I know both those guys; they are very savvy businessmen,” Obama said in the interview yesterday in the Oval Office with Bloomberg BusinessWeek, which will appear on newsstands Friday. “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free- market system.”

via Obama Doesn’t ‘Begrudge’ Bonuses for Blankfein, Dimon Update1 – Bloomberg.com.

via Obama Doesn’t ‘Begrudge’ Bonuses for Blankfein, Dimon Update1 – Bloomberg.com.

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Morgan Stanley Allots 62% of Revenue to Employee Pay Update2 – Bloomberg.com

Jan. 20 Bloomberg — Morgan Stanley, the world’s biggest brokerage, allocated 62 percent of revenue to pay employees in 2009, the highest ratio in more than a decade, as the firm added staff faster than it made money.The compensation and benefits expense rose 31 percent to $14.4 billion as revenue climbed 28 percent, the New York-based company said today. Because Morgan Stanley added more than 15,000 employees in June through its Morgan Stanley Smith Barney wealth-management joint venture, average compensation per employee fell to $235,193 from $244,000 last year.Wall Street firms including Morgan Stanley are under pressure from politicians and regulators to curb year-end bonuses after taxpayer funds helped the companies rebound from the financial crisis. At the same time, Morgan Stanley’s efforts to keep brokers at Smith Barney and hire 400 people for sales and trading added to compensation costs. The bank posted fourth- quarter earnings from continuing operations of $413 million today, missing analysts’ estimates on lower trading revenue.

via Morgan Stanley Allots 62% of Revenue to Employee Pay Update2 – Bloomberg.com.

via Morgan Stanley Allots 62% of Revenue to Employee Pay Update2 – Bloomberg.com.

Robert Reichs Blog: The Great Disconnect Between Stocks and Jobs

The result, overall, is an asset-based recovery, not a Main Street recovery. Yes, the economy is growing again, but the surge in productivity is a mirage. Worker output per hour is skyrocketing because companies are generating almost as much output with fewer workers and fewer hours. The Fed, meanwhile, has become an enabler to all this, making it as cheap as possible for companies to axe their employees. Money costs so little these days it’s easy to substitute capital for labor. It’s also easy to buy up foreign assets with cheap American money. And it’s now blissfully easy for Wall Street to borrow money almost free and buy all sorts of interests in foreign assets, especially commodities. Thats why were seeing the prices of foreign commodities and other assets go through the roof. At the same time, the Treasury continues to be fixated on keeping banks afloat. The Administrations mortgage mitigation efforts are lagging. Small businesses are starved of credit. The White House has announced a “jobs summit,” which is better than nothing but not nearly as good as pushiing immediately for a larger stimulus, a new jobs tax credit, and a WPA-style jobs program. The Fed and the Teasury have, in effect, placed a huge bet on a recovery driven by asset prices. That’s a bad bet. The great disconnect between the stock market and jobs is pushing stock prices way out of line with the real economy. This isnt sustainable.

via Robert Reichs Blog: The Great Disconnect Between Stocks and Jobs.

via Robert Reichs Blog: The Great Disconnect Between Stocks and Jobs.

Bank CEOs Pledge to Push for Re-Regulation – WSJ.com

Chief executives of the largest U.S. banks acknowledged Monday the “disconnect” between their expressed support for re-regulating financial markets and the work of their lobbyists to weaken any new rules.

The executives pledged during a White House meeting with President Barack Obama that they would personally intervene on behalf of the legislation.

On CBS’s “60 Minutes,” President Obama decries “fat cat bankers” ahead of Monday evening’s meeting between White House officials and banking representatives. Video courtesy of Fox News.

Some of the CEOs said their lobbyists had taken stronger stands than they would have wanted, an assertion met with raised eyebrows on Capitol Hill. House Financial Services Committee Chairman Barney Frank (D, Mass.), chief architect of financial-overhaul legislation in that chamber, said in an interview he was “highly skeptical.”

via Bank CEOs Pledge to Push for Re-Regulation – WSJ.com.

via Bank CEOs Pledge to Push for Re-Regulation – WSJ.com.

Top 30 at Goldman Will Get Stock, Not Cash, as Bonus – NYTimes.com

Is the There a Shift Here?

“Moving to quell the uproar over the return of big paydays on Wall Street, Goldman Sachs announced on Thursday that its top executives would forgo cash bonuses this year and that it would give shareholders a say in determining compensation.

Suzanne DeChillo/The New York Times

Lloyd C. Blankfein, chief executive of Goldman Sachs, instituted the new executive compensation system, which emphasizes pay in stock.

With a resurgent Goldman set to award billions of dollars in bonuses — a trove that could rival the record payouts of the bubble years — the bank said that its 30 most-senior executives would be paid in the form of a special stock, rather than in cash. Goldman said that it would also let its shareholders vote on its executives’ pay, although the decision would be nonbinding.”

Paul Volcker, Former Fed Chairman To Wall Street: “Wake Up, Gentlemen”

Former Federal Reserve Chairman Paul Volcker delivered a jarring message to high-level bankers and regulators at an exclusive meeting in Sussex, England. “Has there been one financial leader to say [executive pay] is really excessive? Wake up, gentlemen. Your response, I can only say, has been inadequate,” he said, according to the Times of London.Volcker, a veteran of the financial world and currently chairman of President Obamas Economic Recovery Advisory Board, spoke on Tuesday at the Future of Finance Initiative conference, organized by the Wall Street Journal.Amid throngs of bankers arguing that new regulations should not impede on financial “innovation,” Volcker pushed back, blasting Wall Streets increasingly complex financial products as useless to economic growth. In what seems to have been a shot at exotic securities, he named the ATM cash machine as the most successful financial innovation in the past 20 years, the Times reported.

<p>via <a href=”http://www.huffingtonpost.com/2009/12/09/paul-volcker-former-fed-c_n_385274.html?igoogle=1&#8243; mce_href=”http://www.huffingtonpost.com/2009/12/09/paul-volcker-former-fed-c_n_385274.html?igoogle=1″>Paul Volcker, Former Fed Chairman To Wall Street: “Wake Up, Gentlemen”</a>.</p>

via Paul Volcker, Former Fed Chairman To Wall Street: “Wake Up, Gentlemen”.