bon bon does have a point. While a lot of things happened before 2008 to set up the economic mess (and to the extent government policies contributed, I'd go back a lot further), the mess and the extent of the mess have only become clearer within the last year or two. Using the mortgage mess as an example, you don't have to be as reckless as a New Century to see a lot of loans go bad when people are losing their jobs at rates we haven't seen in decades. So the worst generalization about bonuses based on 2007 results may be that they were based on short-term results that didn't consider possible long-term consequences. In other words, you could make an argument (and I'll stay out of whether I agree with that argument) for stupidity or negligence, but not fraud.

That said, there are a couple more points to be made. Bonuses based on 2008 results are among the highest ever (I'm hearing sixth). There may be individuals deserving bonuses, maybe even pretty substantial bonuses. But there's something wrong when a business or an industry goes into the tank and bonuses -- supposedly rewards for a job well done -- are at the high end of historic levels.

I'll also say there's something wrong when a business is laying workers off right and left, but the folks in the executive suites continue to knock down seven, eight, or even nine figure compensations as if nothing had gone wrong. I'll agree that laws restricting executive compensation in general are problematic (with a caveat that many laws, good and bad, happen because the private sector doesn't correct something that people are upset about). But if your business is in such bad shape that the government has to bail you out, your top folks can't conduct business and compensation as usual.

Tommyrot clearly hates me.

Just think of that post as a time saver. Look at how many links we got to skip.

So, bon bon, do you think articles like this one [link] are referring to bonuses paid in early 2008, based on 2007 activity? The article certainly left me with the impression that they are talking about Dec. 2008-Jan. 2009 bonus payouts, based on 2008 performance. But I don't know much about I-banking.

No, you're right, it's based on 2008 performance -- though with the exception of Merrill, the article doesn't distinguish which firms paid what -- all you know is that the industry as a whole did bad yet bonuses were paid to people in the industry.

Are there individual investment banks that did well in 2008?

I'll agree that laws restricting executive compensation in general are problematic

The current law I've heard proposed only applies to companies taking bailout money- i.e. government welfare. There are pretty severe strings attached to working mothers taking cash assistance. Are string attached to government welfare problematic in general, or only when the welfare goes to people whose income has enough zeros?

judgey judgey mc judge judge

Yeah, at this point I think the state might want to step in, as there is something seriously not right about this woman and I have serious doubts about anyone being capable of single parenting 14 children under the age of 8.

Nope. Still can't bring myself to be on the same side of an argument as BillO the Clown.

Just one more post on this -- again, I'm NOT advocating sympathy for the executives themselves*. I'm talking about family members and employees -- maids, housekeepers, cooks, drivers. Yes, those are luxuries, but for the people doing the actual jobs, those are their actual jobs.

I don't have any figures or links to back me up, but I'm betting the number of people employed by lots of low level workers being able to make regular purchases of all sizes is WAAAAAAAAAY more than all of the high paid executives put together.

But I would point out that high compensation, especially for leadership at companies in trouble, does have actual justification, and as it stands there's little reason to work for these institutions right now.

Maybe I'm just too much of an unapologetic far lefty, but I've heard this argument quite a lot over the years, and I have never been convinced by it.

Yes, I somewhat see the case for execs to make very large paychecks, but not of the size they are actually making. And I'm not terribly convinced that there is a set of skills required to be an executive that only a very elite few can learn and master in order to do the job.

That said, there are a couple more points to be made. Bonuses based on 2008 results are among the highest ever (I'm hearing sixth). There may be individuals deserving bonuses, maybe even pretty substantial bonuses. But there's something wrong when a business or an industry goes into the tank and bonuses -- supposedly rewards for a job well done -- are at the high end of historic levels.

Well, that would all depend on Toddson's point of bonuses being shifted to December. Otherwise, you are talking about bonuses not yet given (under the traditional bonus calendar).

Bonuses given to Wall Street execs in 2008 are most likely the ones they received in March or so last year, i.e., based on the 2007 stock market being at an all-time high. So its not so strange that 2008 bonuses would be the highest ever.

My friends in banking were planning at least as early as fall on not receiving bonuses for the 2008 calendar year.

I think it's more like "defer this chunk of compensation for tax purposes." I'm not SURE it is, but I think it is.

My point was only that I often hear that you have to tip a waiter X because they count on tips as income, regardless of how good or bad the service was.

what is the rhyme to easy peasy ____ ______?

"pumpkin pie, motherfucker"

Ha! Good to know I wasn't the only one who went there. Thank you, Trudy.

{{{Joe and Aims}}}

And, you know, you're talking about real people whose entire life revolves around the success of the market, I don't think they were all working toward a global financial collapse, or that they're all evil, mendacious monsters looking to ensure the loss of their own jobs.

I sure am glad I didn't say anything like that, then.

Do I think they were greedy and -- as Fred Pete said -- stupid and negligent? Yes. Do I think their overall industry -- as brenda was going to say and Emily said -- incentivized astonishingly negligent, shameful behavior? Yes. And I don't think such behavior warrants bonuses that equal more than I'll make in a lifetime. I realize that their own companies/industry thought/think such behavior warrants such bonuses, but I not so respectfully disagree.

Do I think they're evil mendacious monsters? Seriously? Like I said, I'm glad I didn't say that I thought they were.

Those 2 just left office.

But if your business is in such bad shape that the government has to bail you out, your top folks can't conduct business and compensation as usual.

But the bonus pool doesn't just cover "top folks" -- it goes pretty deep and covers a lot of people who aren't millionaires (though generally still doing well). But this is what I was saying about it being a PR problem before -- if the industry is set up so that significant numbers of people can reasonably expect a significant amount of their total compensation to come in the form of a bonus, it looks bad when the business doesn't do well to give the bonuses, where it wouldn't look so bad from the outside if the salary pool had just been increased by most of that amount.