Pay czar going after CEO pay

#26
#26
rjd970 said:
It does to me. It's how it works everywhere else. You can still reward the top performers, but the bonus pool shouldn't be as big as it is a year removed from institutional disaster.
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the way it works everywhere else is if you piss off your rainmakers they go elsewhwere. if they can afford to retain these people they should. it's ridiculous to act like these companies are just throwing money at people for no reason.
 
#27
#27
droski said:
respond directly to the post:

BECAUSE THE SALARIES AREN'T WHAT BANKRUPTED THE FRIGGIN COMPANIES

AND

the majority of people getting bonsues were generating BIG PROFITS for the companies.


What did i say that is FACTUALLY incorrect douchebag?
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No. I've decided not to engage with you anymore. You're a complete moron. You simply insult anyone that doesn't agree with your narrow minded 'America is best' worldview. It's impossible to even have a conversation. You really hit the heights of stupidity with 'name one great company, advance, or invention from Europe in the past 50 years'. It's like trying to argue with a brick wall. Forums are supposed to be about debate and you just arent interested in it.
 
#28
#28
pejp said:
No. I've decided not to engage with you anymore. You're a complete moron. You simply insult anyone that doesn't agree with your narrow minded 'America is best' worldview. It's impossible to even have a conversation. You really hit the heights of stupidity with 'name one great company, advance, or invention from Europe in the past 50 years'. It's like trying to argue with a brick wall. Forums are supposed to be about debate and you just arent interested in it.
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nicely played. it's interesting how you never respond to any of my "moronic" statements with anything but insults. Never any fact to show how stupid i am.

you don't even work for a hedge fund do you? you are completely full of it. i bet your 16 and living at home.
 
#29
#29
I dont really care if you believe me or not. I registered here to get advice about going to Tennessee (which was a fun visit) and started posting in here as I thought it'd be interesting, but it isnt. I've sent a request to have my account deleted as the level of ignorance in here is just depressing. It's like a sore tooth that you can stop touching....I'm sickened yet fascinated with how incredibly narrow minded people can be. Your comment yesterday about naming a single advance or invention to come out of Europe in 50 years, or your assertion that the US is the only place in the world where people can be successful was really eye opening. We all know that caricature/stereotype of the typical ignorant American who cant see beyond his own back yard, but so many on here really epitomise that. Sometimes arguing can be fun, but this just isnt.
 
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#31
#31
droski said:
the way it works everywhere else is if you piss off your rainmakers they go elsewhwere. if they can afford to retain these people they should. it's ridiculous to act like these companies are just throwing money at people for no reason.
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Where exactly are these "rainmakers" taking their trade? They get pissed off, look around, are realize there is a finite number of positions they seek and all the goods ones are already filled.
 
#32
#32
UT IE 95 said:
Where exactly are these "rainmakers" taking their trade? They get pissed off, look around, are realize there is a finite number of positions they seek and all the goods ones are already filled.
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guys who can generate consistant returns and/or have large books of business are never not able to find other positions. goldman, morgan staney, jp morgan, private equity, hedge funds, ubs, usb, etc etc etc. christ they are still paying stock brokers millions upfront to change firms in this environment. obama is ensuring that those players i listed will dominate the next 20 years of wall street.
 
#33
#33
rjd970 said:
Does it matter if they were responsible or not? They work for the bank, and it tanked. They should go into business for themselves if they don't like the ebb and flow of the institution as a whole.
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Bad call. You're hammering people that can bring back prosperity and trading for people willing to work for average salaries. Very shortsighted.
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#34
#34
rjd970 said:
It does to me. It's how it works everywhere else. You can still reward the top performers, but the bonus pool shouldn't be as big as it is a year removed from institutional disaster.
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And people will go away. The guys generating the big income have a market price and they can go get it.
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#36
#36
UT IE 95 said:
Millions up front, to a broker. really?
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yup. tens of millions if he is a big enough producer. one times gross upfront was the industry standard, but if you have the right type of business you can get up to 2 times gross (though some of that generally is deferred).
 
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#37
#37
What are these investors really producing? Is it real wealth, actually backed by something, or is it paper money?
 
#38
#38
rjd970 said:
What are these investors really producing? Is it real wealth, actually backed by something, or is it paper money?
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huh?

no they aren't producing chairs or something.

there are plenty of ways they produce profit at an investment bank:

producing profits by using the companies capital (options trading, arbitrage, etc etc)

servicing institutional or high net worth accounts (so making money essentially by commisions)

bringing in underwriting

bringing in investment banking deals

consulting

etc etc
 
#39
#39
OK, but the OP is about the CEO's and other executives right? Shouldn't they be held responsible for the performance of the company, even if the downfall is only due to a couple small departments? Isn't that kind of the rules when you are one of the ones at the top?

Also, according to this:

Pay Czar Feinberg, Not Obama, Behind Decision to Slash Executive Pay - Political News - FOXNews.com

...it only affects the major institutions, namely Bank of America, American International Group, Citigroup, General Motors, GMAC, Chrysler and Chrysler Financial that have yet to pay back the bailout money. Smaller institutions like Goldman Sachs Group Inc. and JPMorgan Chase & Co aren't affected and can pay whatever they want.
 
#40
#40
it's the top-25 paid employees. at these firms (sans GM and chrysler) a good percentage of the top paid employees aren't directly running the firm. as for the actual executives if you want to find good ones they certainly aren't going to accept this type of pay level. and goldman and jp morgan arent' effected because they paid back the tarp money and that is the problem since those firms will be poaching the other firms best talent.
 
#41
#41
rjd970 said:
OK, but the OP is about the CEO's and other executives right? Shouldn't they be held responsible for the performance of the company, even if the downfall is only due to a couple small departments? Isn't that kind of the rules when you are one of the ones at the top?

Also, according to this:

Pay Czar Feinberg, Not Obama, Behind Decision to Slash Executive Pay - Political News - FOXNews.com

...it only affects the major institutions, namely Bank of America, American International Group, Citigroup, General Motors, GMAC, Chrysler and Chrysler Financial that have yet to pay back the bailout money. Smaller institutions like Goldman Sachs Group Inc. and JPMorgan Chase & Co aren't affected and can pay whatever they want.
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The guys who caused the problems are gone. Limiting the NEW guys is the stupid move.
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#43
#43
droski said:
yup. tens of millions if he is a big enough producer. one times gross upfront was the industry standard, but if you have the right type of business you can get up to 2 times gross (though some of that generally is deferred).
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They base it on gross and not net? That's a head scratcher.
 
#44
#44
UT IE 95 said:
They base it on gross and not net? That's a head scratcher.
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No it isn't. Not in an industry where the expense structure is predictable, but it's often out of the control of the producers.
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#45
#45
UT IE 95 said:
They base it on gross and not net? That's a head scratcher.
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usually it's at least a 5 year contract. so you have to figure the company get's around 60% of the money for at least 5 years. if the guy brings his business over it pays for itself.
 
#46
#46
BigPapaVol said:
No it isn't. Not in an industry where the expense structure is predictable, but it's often out of the control of the producers.
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yup. the net cost of adding a new producer is essentially zero (outside of the upfront of course). besides paying for a sales assistant, office space, and his registrations everything else goes to the bottom line and since there is a huge fixed cost the more producers you have the higher the profit margin.
 
#48
#48
BigPapaVol said:
The guys who caused the problems are gone. Limiting the NEW guys is the stupid move.
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Are the executives the ones that caused the problem, or is it the guys in the trenches doing the trading? The one's directly responsible for the crisis should have been fired, agreed, but the executives at the top still have to take some measure of responsibility, no?

As a major stakeholder the government can voice opinions and guide direction of these firms, and I don't know what the problem is with taking it on a case by case basis to ensure talent is retained while at the same time disincitivising risky behavior by controlling how the bonuses are paid out.
 
#49
#49
the executives at the top have been fired in droves. there are actually some of the traders still around. i'd argue it's the opposite of what you are implying.
 
#50
#50
droski said:
the executives at the top have been fired in droves. there are actually some of the traders still around. i'd argue it's the opposite of what you are implying.
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Well if that is really the case, then those traders shouldn't get a dime in bonuses and it doesn't change my mind that executive paid should be tied more closely to overall company performance.

Ken Lewis, the BoA CEO said he would not accept a slary or bonus for all of 2009. To any executive with any kind of integrity this would provide more incentive to pay back bailout funds and turn the company around than any bonus would. You may disagree, but I think executive pay shouldn't be an entitlement, it should be earned based on company performance.
 
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