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sabra Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-30-09 11:48 AM
Original message
Study: (Bailed Out) Bank Bonuses Far Exceeded Profit
Source: CBS News

Several Bailed Out Banks' Bonuses Topped Their Net Income in 2008, According To N.Y. AG's Report

(CBS) Several financial giants that received federal bailout money in the last year paid out bonuses to employees in 2008 that greatly exceeded the amount of profit generated by the banks, according to a study on executive compensation released by New York Attorney General Andrew Cuomo Thursday.

Despite claims by bank executives that bonuses are tied to the company's performance, the report states that "there is no clear rhyme or reason to how the banks compensate or reward their employees."

According to the report:

# Goldman Sachs, which earned $2.3 billion last year and later received $10 billion in TARP funding, paid out $4.8 billion in bonuses in 2008 - more than double their net income.

# Morgan Stanley, which earned $1.7 billion last year and received $10 billion in bailout funds, handed out $4.475 billion in bonuses, nearly three times their net income.

# JPMorgan Chase, which earned $5.6 billion in 2008 and later received $25 billion from the government, paid out $8.69 billion in bonus money.

Read more:
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followthemoney Donating Member (745 posts) Send PM | Profile | Ignore Thu Jul-30-09 12:20 PM
Response to Original message
1. They got bonuses for sticking together to extort the ...
government into bailing them out with the public's money. That took hard work and nerves of steel.

Most scam artists play on a much smaller field when they choose their victim. These guys deserve everything they get just for having the balls to pick out the biggest most powerful people to play as a chump.

Most capitalist will choose the most desperate and weak victims when they set their sights on whose lunch they want to eat. There may be a lot of money in beating the cash out of sick people through insurance scams, but their is no honor like beating the Congress of the world's last superpower.
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redqueen Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-30-09 12:22 PM
Response to Original message
2. Must be nice to own the government. (nt)
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Igel Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-30-09 06:13 PM
Response to Original message
3. Very simple, that conclusion.
Here's a complication or two.

1. You have a company, one branch rakes in $2 billion and another branch loses $3 billion. You compensate those who brought in money, but you've made no money. If you don't reward those who busted their butts, they may go elsewhere or not work as hard. But if you do, you're apparently rewarding people for losing you money. You don't give bonsues. Stupid or smart? Answer: Stupid. You've insulted your best employees.

2. You have a company that's losing money. It lost money last year and so you implemented some personnel changes. Institutional reform and effects of the economy will take at least a year to work their way through, however you like the changes you see. Do you penalize the people that you've brought on board, even though in lean times they tend to work much harder than in fat times? If you do, you are criticized. If you don't, the people you've hired to help turn your company around are pissed and slack off. You decide to award bonuses, since you still have money in the bank. Stupid or smart? Smart. "Performance" isn't just measured in "profits". It can also be, "How did you limit our losses?"

Been there, done that.

"No clear rhyme or reason" is the give-away. The bonuses weren't distributed randomly; such things always follow some pattern. That the "researchers" saw no pattern means either they didn't include as an option what was really going on, or they couldn't accept the pattern. Or, perhaps, they assumed that the pattern had to be simple, when such things seldom are and usually are the consequence of overlapping and difficult-to-apply criteria. (I just listened to an interview with the chairman of a top law firm as he ran down the 4 criteria for awarding compensation to the firm's partners, and how it became very complicated when actually applying the relatively simple criteria. A couple of the criteria I thought crazy, but when he explained them they made sense. And it's understandable how the firm's been one of the top 10 in the country for the last 80 years.)
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TankLV Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-30-09 10:01 PM
Response to Reply #3
4. No - the "simple" answer is easy: NO MONEY = NO BONUSES.
Edited on Thu Jul-30-09 10:03 PM by TankLV
Economics 101.


To do otherwise is STEALING - especially when SOMEONE ELSE IS FOOTING THE BILL!!!

That's how the company I work for operates - for EVERYONE (so they say)...

nice BULLSHIT buddy...

God I HATE that texASS mentality and "logic" - it's what's RUINED this country!!!
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KakistocracyHater Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jul-31-09 01:13 AM
Response to Original message
5. gee I wonder WHERE they got that money-retirement accounts?
insurance 'cancelled' for workers?.......can we admit that we don't need CEOs anymore & outlaw these dead weights? Let the boards steer their corps.
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Senator Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jul-31-09 03:13 AM
Response to Original message
6. K&+R
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