Bailout, Bankers, and Chutzpah

Kama

Came across Saturday's Guardian article late, resonates for me with the apparent 'Barstool Economics' view on inequality, and market-dominant minorities...I'm sure it's old news to everyone here, but I'm curious as to people's views...

Financial workers at Wall Street's top banks are to receive pay deals worth more than $70bn (£40bn), a substantial proportion of which is expected to be paid in discretionary bonuses, for their work so far this year...

Staff at six banks including Goldman Sachs and Citigroup are in line to pick up the payouts despite being the beneficiaries of a $700bn bail-out from the US government that has already prompted criticism. The government's cash has been poured in on the condition that excessive executive pay would be curbed...


The sums that continue to be spent by Wall Street firms on payroll, payoffs and, most controversially, bonuses appear to bear no relation to the losses incurred by investors in the banks.

Guardian

Bailout: 700 Billion
Bankers Pay Deals: 70 Billion
Chutzpah: Priceless

BenjAii

Although I would normally say its none of governments business to have anything to do with what private companies pay individuals; I am beginning to change my mind when it comes to investment banks.

There is now no argument that their reward has any link to performance, in which case their behavior looks like fraud.

Given its the tax payer footing this bill, I'm surprised people aren't talking about criminal prosecution, it certainly merits it.

Kama

Agree with you, and that goes double when there is state intervention on this scale. A classic problem with intervention is that you are picking winners and losers, which is precisely what Paulson has done, with 'Government Sachs'.