The Rich On Wall St. About To Become Poor, Sort Of
Wall St. bonuses will be down sharply in 2008. One would hope so. Management at the lower tip of Manhattan has cost investors hundreds of billion of dollars in lost market cap in big banks and brokerages.
But shareholders want the proof that rich traders and executives will get cut to be iron clad.
According to Reuters, “As merger activity slows and banks write down billions of dollars of assets, bonuses for investment bankers and stock and bond traders could decline by at least 10 percent in 2008, while top executive bonuses could fall by as much as 35 percent.” The information is from Johnson Associates compensation consultants,
The cuts do not seem reasonable. Someone making $3 million will now make $2 million. How much punishment is that for a job poorly done? CEOs at big firms who made $30 million will now make only $20 million. That is nice pay for nearly putting a financial firm out of business.
No one said life is fair.
Douglas A. McIntyre