Monday, January 5, 2009

"Bailout for Bonuses!"

Came across this interesting nugget of info in the January '09 edition of Bloomberg Markets magazine, courtesy of columnist Jonathan Weil:

Here's all you need to know to see who lost and who benefitted most at the Five Families of Wall Street, otherwise known as Bear Sterns Cos., Lehman Brothers, Merril Lynch, Goldman and Morgan Stanley. From the start of their 2004 fiscal year through October 20, the big stand-alone investment banks lost about $83 billion of stock market value. During the same period, they reported about $239 billion of employee compensation expense.

So for every dollar of shareholder value destroyed, the employees got paid almost three.

Interesting that compensation on Wall Street seems in recent years to be completely divorced from actual performance.

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