Reminiscing...Remember those record Bonuses (39 BILLION) the big five gave themselves at the end of last year? They knew the score, huh...?

[link to www.chinapost.com.tw]



I remember reading about this and thinking well, how nice for them....


At the time, back in the early spring, I had bookmarked it to share with friends. Was going through bookmarks today, came across it, and thought it a bit timely considering the recent events....

These guys knew, like anyone with a brain knew, that the band-aids were failing and collapse was imminent - only they had the ability to pad their pockets just a bit first....

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Bonuses at top 5 Wall Street firms hit record US$39 bil.

By Christine Harper, Bloomberg
Saturday, January 19, 2008


NEW YORK -- Wall Street's five biggest firms are paying a record US$39 billion in bonuses for 2007, a year when three of the companies suffered the worst quarterly losses in their history and shareholders lost more than US$80 billion.

Goldman Sachs Group Inc., Morgan Stanley, Merrill Lynch & Co., Lehman Brothers Holdings Inc. and Bear Stearns Cos. together awarded US$65.6 billion in compensation and benefits last year to their 186,000 employees. That means year-end bonuses, at 60 percent of the total, exceeded the US$36 billion distributed in 2006 when the industry reported all-time high profits.

The New York-based firms, which shed 25 percent of their equity value during 2007, have said they're eliminating at least 6,200 jobs amid mounting losses from the collapse of the subprime mortgage market. The payouts come as the U.S. economy slows, with unemployment rising, retail sales declining and new home foreclosures surging to a record.

"To many people, it will be shocking and questionable," said Jeanne Branthover, managing director of Boyden Global Executive Search in New York. "People in New York in the world of investment banking will understand it. It's critical that pay is still there or you're going to lose really good people."

The industry's bonuses are larger than the gross domestic products of Sri Lanka, Lebanon or Bulgaria, and the average bonus of US$219,198 is more than four times higher than the median U.S. household income in 2006, according to data compiled by the U.S. Census Bureau.

Shareholders in the securities industry endured their worst year since 2002, as Merrill and Bear Stearns slumped more than 40 percent in New York trading and the chief executive officers at both firms gave up their jobs. Morgan Stanley fell 21 percent and Lehman dropped 16 percent. Only Goldman rose, gaining 7.9 percent.

"Wall Street firms have always been run, and likely always will be run, for the upper-level management, not for the shareholders," said James Ellman, who manages about US$200 million, including stock in Morgan Stanley and Merrill, at San Francisco-based SeaCliff Capital.