[quote=“bob”]
A person would have to leave human society in order to not participate in the oil economy, in order to not contribute to the obscene earnings of people whose values likely run entirely contrary to his own and who by virtue of their inordinate power push society in directions that he does not wish to see it go. Or do you imagine this fucko is big on green living, solar power and mass transit?[/quote]
Seen “There Will Be Blood”?
option?
CEO comp, a lot of the bonuses are tied to how well the company is doing.
Now all we need to do is to tie deductions from salary and bonus to how bad the company is doing?
(half-joking as it would have legal and practical problems)
[quote=“Jack Burton”]
Now all we need to do is to tie deductions from salary and bonus to how bad the company is doing?
(half-joking as it would have legal and practical problems)[/quote]
Yeah, and see how long it takes for them to cry help for gov’t protection! 
I haven’t owned a car in over twenty years. Nobody decided for me.
I haven’t owned a car in over twenty years. Nobody decided for me.[/quote]
Precisely.
In light of the financial collapse, and the collapse of oil prices (back down to $40/barrel now), I’m wondering why so many CEOs are still arguing that they deserve their bonuses.
I wonder why anyone might still think they deserved their basic salaries.
Yep, sure did a bang-up job, those big-money men.
Good point, Jaboney. I believe there were some in this thread who claimed CEOs do deserve that kind of compensation, that they perform a service valuable enough to merit such pay. I’d be curious if, in light of the subsequent collapse of Wall Street (finally), revealing so much to have been pure sham, if they still feel that way.
If they do, and I apologize for flogging this one, but I hope they’ll read the Michael Lewis article I’ve been recommending lately, or at least these excerpts, and tell us why they still feel that kind of astronomical compensation is warranted.
[quote]To this day, the willingness of a Wall Street investment bank to pay me hundreds of thousands of dollars to dispense investment advice to grownups remains a mystery to me. I was 24 years old, with no experience of, or particular interest in, guessing which stocks and bonds would rise and which would fall. The essential function of Wall Street is to allocate capital—to decide who should get it and who should not. Believe me when I tell you that I hadn’t the first clue.
I’d never taken an accounting course, never run a business, never even had savings of my own to manage. I stumbled into a job at Salomon Brothers in 1985 and stumbled out much richer three years later, and even though I wrote a book about the experience, the whole thing still strikes me as preposterous—which is one of the reasons the money was so easy to walk away from. I figured the situation was unsustainable. Sooner rather than later, someone was going to identify me, along with a lot of people more or less like me, as a fraud. Sooner rather than later, there would come a Great Reckoning when Wall Street would wake up and hundreds if not thousands of young people like me, who had no business making huge bets with other people’s money, would be expelled from finance.
When I sat down to write my account of the experience in 1989—Liar’s Poker, it was called—it was in the spirit of a young man who thought he was getting out while the getting was good. I was merely scribbling down a message on my way out and stuffing it into a bottle for those who would pass through these parts in the far distant future.
Unless some insider got all of this down on paper, I figured, no future human would believe that it happened.
I thought I was writing a period piece about the 1980s in America. Not for a moment did I suspect that the financial 1980s would last two full decades longer or that the difference in degree between Wall Street and ordinary life would swell into a difference in kind. . .
At some point, I gave up waiting for the end. There was no scandal or reversal, I assumed, that could sink the system.
Then came Meredith Whitney with news. Whitney was an obscure analyst of financial firms for Oppenheimer Securities who, on October 31, 2007, ceased to be obscure. On that day, she predicted that Citigroup had so mismanaged its affairs that it would need to slash its dividend or go bust. It’s never entirely clear on any given day what causes what in the stock market, but it was pretty obvious that on October 31, Meredith Whitney caused the market in financial stocks to crash. By the end of the trading day, a woman whom basically no one had ever heard of had shaved $369 billion off the value of financial firms in the market. Four days later, Citigroup’s C.E.O., Chuck Prince, resigned. In January, Citigroup slashed its dividend.
From that moment, Whitney became E.F. Hutton: When she spoke, people listened. Her message was clear. If you want to know what these Wall Street firms are really worth, take a hard look at the crappy assets they bought with huge sums of borrowed money, and imagine what they’d fetch in a fire sale. The vast assemblages of highly paid people inside the firms were essentially worth nothing. For better than a year now, Whitney has responded to the claims by bankers and brokers that they had put their problems behind them with this write-down or that capital raise with a claim of her own: You’re wrong. You’re still not facing up to how badly you have mismanaged your business. . .
This woman wasn’t saying that Wall Street bankers were corrupt. She was saying they were stupid. These people whose job it was to allocate capital apparently didn’t even know how to manage their own. . . .
Over the years, I’d heard bits and pieces about [former Solomon Brothers CEO, John] Gutfreund. I knew that after he’d been forced to resign from Salomon Brothers he’d fallen on harder times. I heard later that a few years ago he’d sat on a panel about Wall Street at Columbia Business School. When his turn came to speak, he advised students to find something more meaningful to do with their lives. As he began to describe his career, he broke down and wept.[/quote]
portfolio.com/news-markets/n … Boom#page1
This is interesting.
[quote=“Clusterstock”]Brilliant: Credit Suisse To Pay Top Execs With Illiquid Mortgage Securities
We’re shocked that nobody has suggested this before, but on its face this looks like a great idea… Credit Suisse announced today that bonuses for its top executives would be made in illiquid, mortgage-backed securities. Seeing as these guys are responsible for getting this stuff on the companies books, it makes sense to shove it back to them. And if the market gets liquid again, and the stuff goes up, that’s going to be a huge windfall for execs:
[quote]Bloomberg: The bank will use leveraged loans and commercial mortgage- backed debt, some of the securities blamed for generating the worst financial crisis since the Great Depression, to fund executive compensation packages, people familiar with the matter said. The new policy applies only to managing directors and directors, the two most senior ranks at the Zurich-based company, according to a memo sent to employees today.
“While the solution we have come up with may not be ideal for everyone, we believe it strikes the appropriate balance among the interests of our employees, shareholders and regulators and helps position us well for 2009,” Chief Executive Officer Brady Dougan and Paul Calello, CEO of the investment bank, said in the memo.[/quote]
Another bonus: This moves the stuff off of Credit Suisse’s books, while letting it hold onto its precious cash. Will we see any copycats?
[/quote]
[quote=“Mother Theresa”]Good point, Jaboney. I believe there were some in this thread who claimed CEOs do deserve that kind of compensation, that they perform a service valuable enough to merit such pay. I’d be curious if, in light of the subsequent collapse of Wall Street (finally), revealing so much to have been pure sham, if they still feel that way.
If they do, and I apologize for flogging this one, but I hope they’ll read the Michael Lewis article I’ve been recommending lately, or at least these excerpts, and tell us why they still feel that kind of astronomical compensation is warranted.[/quote]
I’m not sure whether these CEOs do or don’t deserve their compensation. In one sense, I think it should be tied to performance.
However, it’s ultimately about what the market will bear. Do I think it’s worth choosing between two pairs of sneakers that cost the same tiny amount to make in a sweatshop and paying a lot more for the one with a certain logo on it? Not really usually. However, plenty of people do.
So, if people are willing to pay more money for something, that’s up to them (that may be the same as, or inferior, to something else), be it a pair of sneakers or CEOs and fund managers. As Eli Wallach’s character in The Good, The Bad and The Ugly said, “if God had not meant for sheep to be shawn, he wouldn’t have given them wool.”
Advocates of the free market don’t argue that a lot of dumb decisions won’t be made, merely that people should be allowed to make decisions, be they smart or dumb. Decisions will be rewarded or punished accordingly.
The US banking sector: $1 trillion in the hole with taxpayers on the hook.
Economic impact: Worst hit since the Great Depression.
Bonuses paid out by banks getting bail out funds: $18 billion.
Priceless
[quote=“Jaboney”]The US banking sector: $1 trillion in the hole with taxpayers on the hook.[/quote]Thank 0bama for this. Its his "bail-out’ plan.
[quote=“Jaboney”]Economic impact: Worst hit since the Great Depression.[/quote]"Worst hit since the ‘Great Depression’ is both weirdly ohrased and wrong. A bit of factual reading would help…a lot.
But facts do seem to be unrequired to ‘some’ people.[quote=“Jaboney”]Bonuses paid out by banks getting bail out funds: $18 billion.[/quote]All these banks are also rasn by LARGE contributors to 0bama. See a trend here? One would have to be blind, stupid and not interested in the facts to not see the trend.[quote=“Jaboney”]Priceless[/quote]Is that in Canadian “dollars”?
RAMPANT DEPRESSION UNDER 0BAMA!
…I have no idea why this titillates some Canadians…but it does.
The guys been president for all of 20 seconds and this is “his” bail out plan. Didn’t McCain tell Letterman he was rushing back to Washington because the economy was cratering? Didn’t the bail out plan have cross party support, long before the elections?
I love this guy. Spent much of the holiday reading Fooled by Randomness. Terrific wit.
[quote=“Reuters”]Nassim Nicholas Taleb, the author of “The Black Swan: The Impact of the Highly Improbable”, has a simple proposal to as he puts it, “save capitalism and free markets from the banks.”
Nationalise the banks, limit the rewards to those who work in what he calls the “utility” part of the system and have a completely uninsured second leg that can take all the risks it wants and lose its shirt, he said in an interview in Davos at the World Economic Forum.
“They rigged the game. We pay them for their profits, there is no clawback so their incentive is to hide the risk they are taking.”
[…]
He describes his plan as Capitalism 2.0. It would have a barbell structure, with the insured utility-like part on one end and the free market bit with privatized risk on the other.
He describes banking bonuses as asymmetric because the banker gets the upside but does not share in the liability which ultimately may be funded by taxpayers, as we have seen.
[…]
And a bit like an Old Testament prophet, Taleb is angry and wants those he thinks are responsible to suffer.
“I want them poor and they deserve to be poor.You can’t have capitalism without punishment.”
Oh, and another thing, he wants Bob Rubin, who trousered millions while chairman of Citigroup, to cough up.
“I want Bob Rubin to return his $110 million dollars to the American taxpayer.”[/quote]
The guys been president for all of 20 seconds and this is “his” bail out plan. Didn’t McCain tell Letterman he was rushing back to Washington because the economy was cratering? Didn’t the bail out plan have cross party support, long before the elections?[/quote]
Well given that everyone blames the predecessor for all the bad stuff (which some things he had control over, others he didn’t), then it goes to set an example that the future presidents can take all the blame when things don’t work and all the credit when they do. If the bailout plan does work, will he share credit? Not fucking likely. It will be the “Obama bailout plan saved America, vote for Obama in 2012”. 
It is a lousy stimulus plan and that is obvious from the fact that the markets have responded so poorly to it. People who invest know it isn’t going to work worth a shit. It is too slow for one thing. What he should do is give out coupons that could be redeemed immediately for cash at one rate (say USD 500) or used for alternative energy investments at another, say USD1,000. People should be allowed to buy and sell their coupons on the market as they see fit. If you can get 7,00 from somebody who is interested in saving 300 on retrofitting his house, fine. If one really rich person wants to buy up a four dozen coupons and rig up his apartment complex, great! Everybody wins. You get 700 to put food on the table, pay your mortgage for two weeks, or pay down a portion of your student loan and the other guy gets a 30% discount on his home improvements/ investments. A plan like that would stimulate the economy immdiately and help to start the process of weaning the country off oil. And it would made people happy because it would GIVE THEM SOMETHING FOR THEIR FREAKING MONEY!
He could have killed two birds with one stone and instead he cooked up a turkey.
[quote=“bob”]It is a lousy stimulus plan and that is obvious from the fact that the markets have responded so poorly to it. People who invest know it isn’t going to work worth a shit. It is too slow for one thing. What he should do is give out coupons that could be redeemed immediately for cash at one rate (say USD 500) or used for alternative energy investments at another, say USD1,000. People should be allowed to buy and sell their coupons on the market as they see fit. If you can get 7,00 from somebody who is interested in saving 300 on retrofitting his house, fine. If one really rich person wants to buy up a four dozen coupons and rig up his apartment complex, great! Everybody wins. You get 700 to put food on the table, pay your mortgage for two weeks, or pay down a portion of your student loan and the other guy gets a 30% discount on his home improvements/ investments. A plan like that would stimulate the economy immdiately and help to start the process of weaning the country off oil. And it would made people happy because it would GIVE THEM SOMETHING FOR THEIR FREAKING MONEY!
He could have killed two birds with one stone and instead he cooked up a turkey.[/quote]
I think one of the major issues is that there hasn’t been much yet from President Obama about the details to his campaign plans. As far as the economy goes, this stimulus bill is the only thing I’ve really heard, other than Wall Street is evil evil evil. At least his Treasury secretary made it through the confirmation, since now Daschle is the second one to get caught not paying taxes.
That being said, you seem to be pretty dead set on the alternative energy coupons. While I like the idea of both sides being able to benefit (the families getting more than cash value and the other party getting it for less than redeemable value), you still get one big issue. This isn’t only supposed to be a stimulus bill to send people spending (which they are afraid to do). It’s also supposed to be a way in which to start the rebuilding of the economy and get jobs being created. While it would be nice to see jobs being created to install alternative energy systems, that’s not exactly realistic. They are still too expensive. There aren’t enough businessmen who would purchase the coupons to really make it worthwhile to offer it. Everyone would go for a quick 500 dollars and we would be worse off in the long run because now a precedent is set. That’s why I was also against the stimulus bill last year. Once you start handing out money, people expect to get more in the future.
While two birds with one stone is a nice idea, it’s a little premature when one of the bird’s isn’t yet a bird, or even an egg yet. It’s still an idea of a nice future egg that will grow up. It needs to be nurtured more before it can be raised and sustainably eaten.
OK change it to USD250 cash or two thousand on alternative energy invetments. I’m easy. It’s easy. The reason nothing like this is being done is not because they haven’t thought of it. The reason it’s not being done is because Obama is in the back pocket of big oil like everybody else.
[quote=“Rosss Douthat”]The debates about whether religion is good for society are endless for a reason: There are too many variables, too many religions, and too many definitions of “good” to make anything like a universally-accepted answer possible. But I’m pretty comfortable saying that a certain kind of religion is good for a certain kind of person. And it’s hard to escape the impression that the world would be in better shape today if more of our elites - our bankers and financiers, our tycoons and captains of industry, and yes, our Presidents as well - had spent the last decade’s worth of Sundays on their knees listening to readings from Ecclesiastes, and Jansenist-inflected sermons about the innate depravity of man. [/quote]I like that. Too little attention’s been paid to the informal institutions undergirding capitalism; too much to the golden bull(market).
[quote=“Reuters”]President Barack Obama will set a $500,000 annual compensation cap on Wednesday for executives at companies getting taxpayer bailouts as part of a wider process to clamp down on excessive corporate pay.
An Obama administration official said the new rules would require banks and other companies that get government funds in the future to abide by the new cap going forward, with any additional compensation being limited to restricted stock that does not vest until government funds are paid back.[/quote]Good news. I’ll laugh my ass off if the CEOs affected take their parachutes and go home to sulk. Let others move up the ladder and demonstrate the hollowness of the ‘great man’ CEO thesis.
Is there no way those guys could be lined up with the mad cow from the other thread and shot? Let’s be clear about what they did. They both extended and took on credit beyond any reasonable limit in order to boost figures and get larger bonuses. They knew they were imperiling the entire economy and if they’d didn’t know they were too stupid to be in the position they were (are) in.