INSANITY: 1 Year After Crisis Spawned by Their Idiocy, Bankers Expect Record Bonuses

Revolt or sink into slavery to these leeches and psychopathic narcissists.

Bankers Expect Rising Bonus Pay to Break Records in Global Poll
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http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a1ZlLqcUMvZg

By Robert Schmidt and Ian Katz

Oct. 30 (Bloomberg) -- In Washington and on Main Street, politicians and voters are railing against Wall Street’s multi- million-dollar pay packages. In the financial world, most executives expect their bonuses to match or exceed last year’s, with 1 in 10 predicting their best-ever payout.

Having shaken off the biggest economic decline since the 1930s, almost three in five traders, analysts and fund managers believe their 2009 bonuses will either increase or won’t change, according to a quarterly poll of Bloomberg customers. Only one in four see a decline. Asians are the most optimistic about pay and Americans and Europeans somewhat less so.

“The large banks are knocking the cover off the ball,” said Daniel Alpert, managing director of New York-based investment bank Westwood Capital LLC. The industry is “making money, though with government help.”

Worldwide, a majority of market professionals in the survey also turn thumbs down on government attempts to limit compensation, with 51 percent saying restrictions will stifle useful innovation. Only about 38 percent think pay limits will control excessive risk-taking.

In the U.S., where President Barack Obama has chided Wall Street for being “motivated only by the appetite for quick kills and bloated bonuses,” 65 percent say the restrictions will damp innovation.

The Bloomberg Global Poll of investors and analysts in six continents was conducted Oct. 23-27. It is based on interviews with a random sample of 1,452 Bloomberg subscribers, representing decision makers in markets, finance and economics. The poll has a margin of error of plus or minus 2.6 percentage points.

‘Hit Hard’

“If we were looking for a sense of Wall Street to be, ‘we’re hit hard, I’m going to make less money,’ these results don’t show it,” said J. Ann Selzer, president of Selzer & Co., the Des Moines, Iowa-based public-opinion research firm that conducted the survey.

The findings “give some fuel to the people who claim that Wall Street hasn’t really gotten it,” said Mark Borges, a compensation consultant at Compensia Inc. in Corte Madera, California. “There really hasn’t been a dramatic cultural shift in these organizations.”

The survey responses are at odds with populist outrage unleashed when American International Group Inc. earlier this year paid bonuses to the financial products unit responsible for the derivatives trades that fueled $100 billion in 2008 losses and led to a $182 billion taxpayer bailout. In an ABC News/Washington Post survey earlier this month, 71 percent backed the Obama administration’s plans to order deep cuts in executive pay at bailed-out companies.

Bullish Markets

The Bloomberg poll results track the stronger economic outlook and bullish global stock markets. The MSCI AC World Index of emerging and developed markets has risen by 64 percent since reaching a low in March. The S&P 500 Index has gained 58 percent during that time.

The survey results also reflect the improved business climate for financial companies after last year’s near collapse of the credit markets. Profits at the biggest banks, like Goldman Sachs Group Inc. and JPMorgan Chase & Co., have soared this year.

“From a sales point of view, we’re going to have a record year,” says poll respondent William Sheffey, a senior equity trader at Commerce Bancshares Inc., who predicted he’d get the highest bonus he’s ever received.

Top Performers

The bank hasn’t taken taxpayer assistance from the U.S.’s $700 billion bailout and has brought in top-performing money managers from troubled competitors, says Sheffey, who adds that he is speaking for himself and not the bank.

Sheffey’s bonus is based in part on the performance of the bank’s funds and the profits of his group. He says the Kansas City, Missouri-based bank doesn’t hand out the type of outsized pay packages that have stoked public ire. “You can’t compare us to what they get at the very high end of Wall Street,” he says.

While 30 percent of those polled in the U.S. say they believe their 2009 bonus will be higher than last year, non-U.S. respondents were even more optimistic, with 39 percent of Asians and 33 percent of Europeans expecting a fatter bonus this year.

The finance industry’s anger at political meddling in compensation is strongest in the U.S., where the administration has named a special master to approve compensation packages at seven firms that have needed exceptional bailouts from the government.

Last week, the paymaster, Kenneth Feinberg, announced he had ordered total compensation cuts averaging 50 percent for 136 people at the companies he oversees. That same day, the Federal Reserve proposed new guidelines for bankers’ pay.

Group of 20

Leaders of the Group of 20 nations in September approved guidelines for financial firms that call for deferred bonuses for senior executives and permit pay to be clawed back if a company has losses later.

Only 27 percent of U.S. respondents think pay limits will control excessive risk-taking, as opposed to the 65 percent who say such moves will discourage innovation.

“I don’t think it’s the government’s place to interfere or set limits or regulations on executive pay,” said Chris Gurkovic, chief market strategist at Deltatide Capital in Jersey City, New Jersey. “If someone is going to take the risk they should be compensated for it.”

Non-U.S. respondents are less dismissive of executive pay limits, with almost half of Europeans saying such constraints will help control financial risk-taking. Still, 41 percent of Europeans, along with 47 percent of Asians, agree pay limits will discourage innovation.


To contact the reporters on this story: Robert Schmidt in Washington at rschmidt5@bloomberg.net; Ian Katz in Washington at ikatz2@bloomberg.net;
Last Updated: October 29, 2009 18:01 EDT

 

when will the sheep start pulling their money out of these banks?

I use a small local bank that is 10,000 times better than boa or citi in every possible way.

wake the F up sheep.

 

That is such a simple solution but yes, how do you get people to do it? It's all about perception. People believe JPM is safer than XYZ Neighborhood Bank, which simply isn't the case. I closed all my accounts with Chase (even though it was a pain in the ass) because I just don't want to do business with the devil anymore. I will no longer do business with them, BAC, or C. I have to have a credit card but I sure as shit won't carry a balance on it.

 

I am not a huge fan of govenment regulation, but in a day and age where "too big to fail" is a free pass to get bailed out, I say you have to break up these enourmous banks.

If you're so big that you pose a systemic risk, then you're just too damn big. You must be divested, IMO.

 

Here (courtesy of Eric G. Lewis, by way of Calculated Risk):

 

I love that picture.