New York State Deficit May Widen by 22% as Bonuses Set to Fall

Discussion in 'Wall St. News' started by ASusilovic, Dec 15, 2010.

  1. Dec. 14 (Bloomberg) -- New York state’s deficit may be 22 percent wider than estimated by the Budget Division because tax revenue, including from Wall Street bonuses, may be less than expected.

    The division has forecast a 13 percent increase in taxable cash bonus payments to $39.7 billion, according to Erik Kriss, a spokesman. By contrast, Options Group, an industry consultant, estimates the annual payments will drop from a year earlier. Capital gains revenue also may fall short of estimates.

    “The next administration will have to contend with a snowballing budget deficit that’s growing fast and picking up speed,” Dennis Tompkins, a spokesman for state Comptroller Thomas DiNapoli, said Dec. 10 by e-mail. “Next year’s deficit could total $11 billion or more.”

    Last week, Morgan Stanley told bankers and traders to expect 10 percent to 30 percent smaller payouts than for 2009, according to two people briefed on the matter. The compensation pool for bankers and traders at JPMorgan Chase & Co. fell 10 percent in this year’s first nine months, while at Goldman Sachs Group Inc. the amount available was 18 percent lower, according to company reports last month.

    At least $1 billion of the fiscal 2012 gap is a carryover from the current year’s imbalance, Tompkins said. “Nothing has been done to address that deficit and it doesn’t appear that the Legislature is going to take any action,” he said.


    Wall Street companies and workers accounted for about 15 percent of the state’s tax revenue in the 2010 fiscal year, which ended March 31, down from 20 percent in years before the financial crisis, according to DiNapoli.


    The Budget Division has projected a surge in capital gains, to $57.7 billion in 2010 from $36.4 billion in 2009.


    So, Ben´s $600bn are not enough to boost investment banker bonuses? Why just not add another "0" to $600bn - problem solved and New York´s tax problem, too.

    Uncle Ben loves NYC. Surge in capital gains over $ 21bn. LOL !
  2. why can't they just sell some of those big apples?
  3. NY is doomed

    Long live Texas