Ten percent of $700 rescue package may go to bonuses
Bloggingstocks
Oct 19th 2008
by Douglas McIntyre
Wall Street walked into the path of its own oncoming stupidity. Of the $700 billion in Treasury rescue money, as much as $70 billion could go to bank and brokerage bonuses.
According to The Guardian, "Financial workers at Wall Street's top banks are to receive pay deals worth more than $70bn (£40bn), a substantial proportion of which is expected to be paid in discretionary bonuses, for their work so far this year." The paper goes on to say that the Morgan Stanley (NYSE: MS) pool is large enough to buy the entire company when its stock was at a recent low.
Although this information get filed under "things you can't make up," it will probably have such a severe backlash that Congress will run hearings until the bankers have exhausted the extra money they are making on legal fees.
The contrary argument to punishing the firms is that some of the people getting big pay-outs work in departments that actually contributed huge sums of money to their parents.
If the management at these firms has any sense at all, they will pay nothing to the staff who worked in operations that lost money and file with the SEC to show the amount of operating income made from the operations where people are getting an extra check...
From AOL Money and Finance
A Goldman Hotshot Doles Out the Money
Neel Kashkari, a 35-year-old former Goldman Sachs whiz kid who believes in free markets, is getting the job at the Treasury Department of dispersing the government's $700 billion rescue. Is he really the right person for the job? Lots of observers have wondered if a seasoned vet with a little more political experience might be a better fit for the task at hand.
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