That oughta show 'em Congress means business!
The House Financial Services Committee will consider legislation to prohibit any bonus payments by companies who have received government bailout funds, until investments are repaid in full, chairman Barney Frank said on Thursday.The measure, to be considered next Tuesday, would prohibit any compensation arrangements that are unreasonable or excessive for these companies, the panel said in a statement.
The bill would also bar bailed-out companies from paying any bonus to any employee, regardless of when any bonus was agreed to, the statement said.
House panel to consider prohibition on bonus payment [Reuters]
Posted by guest , Mar 20, 2009 8:48AM
Is this f*ing happening?
Posted by guest , Mar 20, 2009 8:50AM
CNBC still in denial:
http://www.reuters.com/article/newsOne/idUSN1835152820090318
Posted by guest , Mar 20, 2009 8:50AM
http://www.bailoutpeople.org/
BESS GET ON IT!!!!!!
Posted by guest , Mar 20, 2009 8:54AM
no, jackass @3- stop promoting these retarded demonstrations.
Posted by guest , Mar 20, 2009 8:54AM
You people realize one thing: without government bailout these firms wouldnt exist. Right? I mean they would've went bankrupt so there wouldnt be bonuses anyway? Why cant people understand that fact?
Posted by guest , Mar 20, 2009 8:55AM
@4
They're going to be there whether you like it or not. Don't consider awareness to be promotion.
Posted by guest , Mar 20, 2009 8:56AM
Ok, since TARP-financed institutions can't pay their people a competitive rate, let's just ditch the whole bailout idea and let everyone fail and sink the economy even further. The government is basically setting fire to all the billions of taxpayer dollars they've invested. And they think the financial community is full of fuck-ups. Our political numnuts are making it even worse.
Posted by guest , Mar 20, 2009 8:57AM
@5 That is a FAIL
Many firms that took TARP funds would be just fine without the gov't largess.
This is the gov't going way out on a populist limb. Many "bailed out" firms made and make money and are solvent.
Back to Yahoo
Posted by guest , Mar 20, 2009 8:58AM
@5- completely wrong simpleton. this bill proposes not to give bonuses to any bank that's received money, not just AIG or institutions that were going to fail. as in JPM, GS, and, like the article says ANY FIRM THAT GOT TARP MONEY. why can't you get that fact?
Posted by guest , Mar 20, 2009 8:59AM
@5, the government came in with the idea of saving these companies. They did not do due diligence and they are now scrambling because they f*cked up. They are now essentially killing these banks, because no one will work for them if they will get have to deal with congress. Further, congress is saying that no matter what, they have the final say on comp. How long til this crosses over to another field that they do not like. I was not for the bailouts but if they were going to do them, they should have done them correctly. Now they have just wasted money and ensured that these banks will in fact fail.
Posted by guest , Mar 20, 2009 9:00AM
@5 are you serious? Did you take a wrong turn at Gawker?
Posted by guest , Mar 20, 2009 9:03AM
You talk to Main Street and they think this legislation is only targeting "certain executives at AIG." What the public, thanks to the media, doesn't realize is that this legislation affects all ranks of any TARP bank (with funds in excess of $5B). You could make $75K with a bonus of $50K and your spouse makes $225K as a lawyer somewhere else, and you have to cough up $50K. How is someone who makes $75K responsible for this mess? How does stripping a bank of its ability to hire competitively lead to its rehabilitation? How does further depressing the NY market help turn the economy around? I had little faith in the government before this, now I have none.
Posted by guest , Mar 20, 2009 9:06AM
its classis govt.. no foresight, a failed bill resulting in negative unintentional consequences, and now another bill to try and put a bandaid on the damage... all this will do is create more problems
Posted by guest , Mar 20, 2009 9:06AM
@12 You realize that they're now considering blocking any bonus to any employee at any institution that got gov't cash?
Where am I?
Posted by guest , Mar 20, 2009 9:07AM
wall street is delusional .. washington is full retard ... both will be fucking the collective us until the day we die
Posted by Ben_H , Mar 20, 2009 9:08AM
I wonder if employment/compensation contracts have "illegality" clauses in them?
Posted by guest , Mar 20, 2009 9:10AM
15 ding ding
Posted by guest , Mar 20, 2009 9:12AM
@5 And the economy would be worse off. Instead of the bank repossessing your trailer, it would be the government. Go back to Yahoo, you 'tard.
Posted by guest , Mar 20, 2009 9:12AM
why dont we tax welfare checks at 90% until the recipient finds a job
Posted by KevinB , Mar 20, 2009 9:13AM
@7-12 Thanks for injecting some common sense.
Seriously, if I was Liddy, listening to these asshats who've gone into the red to the tune of $3 trillion over the last six years (not including the stimulus/TARP money) lecture him on how to run a business while he gets paid one simoleon a year, I would have stood up and said "I resign - you geniuses run the thing" and walked out.
Posted by guest , Mar 20, 2009 9:17AM
The problem is you have Wall Street now divided into TARP banks vs. non-TARP banks, and the non-TARP banks will get all the talent. I, for one, am leaving a TARP bank to go to a non-TARP bank next month. Traditionally there is a lot of turnover on Wall Street anyway, but this 90% bonus tax will accelerate turnover like crazy this year. The government seems to be doing its best to ensure that the non-TARP banks outperform the TARP banks. Unfortunately, the taxpayers lose in the end since their billions of investment will go up in smoke.
Posted by guest , Mar 20, 2009 9:22AM
how are you supposed to run your business when throughout the entire organization you are told that if you perform well you will get a bonus and now that carrot is gone.
dont give me crap about these "geniuses" should be fired nonsense, it was maybe a few hundred people who are responsible for this whole mess and for an organization the size of say Citi of 350000 employees its just not fair. not to mention the internal equity problems that will occur for non-us nationals working at these firms who dont have to pay taxes...
Posted by guest , Mar 20, 2009 9:22AM
i have a way to resolve that problem, tax bonuses at 90% throughout the industry.. there you go, problem solved.. its coming, dont think its not -- 'everyone needs to sacrifice during this tough period, change takes time'
Posted by guest , Mar 20, 2009 9:26AM
Hear that giant sucking sound? No, it's not Ashley Dupre. It's all the bankers walking out the doors of TARP-financed institutions.
Posted by guest , Mar 20, 2009 9:26AM
@8 Very easy to declare this after you got the TARP money. When GS at was 40 and change, MS at 6 and everything was spiralling into the abyss in Oct/Nov, you weren't so cocky were you?
Even though the govt made some blunders along the way, it did save everyone's collective asses back then. Look, I'm not a fan of knee-jerk legislation but there has to be SOME accountability. You cannot have "business as usual" as if nothing happenend.
I think the $250K limit is what is rankling people on DB. If it was, say $5m, no one would have bothered and most you would would have been actually enjoyed watch the higher-ups squirm. I'm still not convinced this goes through.
Posted by guest , Mar 20, 2009 9:30AM
If it wasn't so fucking sad, it would almost be funny....
50% of the population pays taxes. The other 50% are free riders.
For the free riders i suggest they get on the aex and the city tour bus because apparently it is been re-routed to visit the homes of AIG executives.
If i was Libby i would have stood up and said "i am done, consider this my resignation".
Posted by guest , Mar 20, 2009 9:30AM
someone hit me with this...
Question - shouldn't all the actors who work for GE (Jay Leno good example) have to pay a 90% tax on thier pay. GE took more than 5 bln. In fact Chuck Gasperino and the others on CNBC who make over 250k shouldn't we hit them too?
Posted by guest , Mar 20, 2009 9:33AM
Liddy not Libby @ 26
Posted by guest , Mar 20, 2009 9:33AM
Yes, the $250k limit is what's really insane, because such a low cap on pay is a significant competitive disadvantage. If it were $1mm or even $500k, far fewer people would be affected.
Posted by guest , Mar 20, 2009 9:34AM
@27. Amen!
Posted by guest , Mar 20, 2009 9:36AM
Congress and the general populous seem to have forgotten that we actually need bankers and that there should be some incentive to keep them in their positions. If this passes everyone that makes > $250,000 should start doing less or no work and show Americans why they get paid what they do. Since the government has become vindictive, I see no reason for the rest of us not to be.
Posted by guest , Mar 20, 2009 9:37AM
27 - Funny how the press hasn't picked up on this one yet! I wonder why...
Posted by guest , Mar 20, 2009 9:41AM
Don't forget this little nugget in the legislation.
(ii) $250,000 ($125,000 in the case of a married individual filing a separate return).
Whoa for you if you are having to file married but with a seperate return.
Posted by guest , Mar 20, 2009 9:43AM
@31
too Atlas, didn't shrug.
Posted by guest , Mar 20, 2009 9:43AM
you people have this all wrong. this is exactly ehat they need to do; they just haven't gone far anough. they should apply this principle behind this rule universally: if "waste" taxpayer money, you get taxed at 90% for anythign over 250K. I'd say that applies to every congressman, the president, most cabinet members, most heads of non-profts and universities. heck, why stop there? let's claw back from prior years!
Posted by guest , Mar 20, 2009 9:44AM
Rather than invest billions of taxpayer dollars in the financial system, why didn't the government just hand out pitchforks, torches and matches to the general populace? Would have been far cheaper for the same result.
Posted by guest , Mar 20, 2009 9:49AM
@25, 8 here
Never needed it, still don't need it. .
All of this will be paid back asap by the banks that agreed to cooperate with the Feds. This will leave the truly f*ed banks out to dry and in the spotlight. Just the situation the gov't wanted to avoid.
Further, now (and thankfully) the gov't will not be able to direct lending (something they know nothing about, ex. TARP).
Why don't you get accountable to your TPS report, thanks.
Posted by guest , Mar 20, 2009 9:50AM
working at a Boutique: priceless...
Posted by guest , Mar 20, 2009 9:50AM
@14 - Yes. It's a slippery slope and down we go. Putin, Putin... is that you?!
-12
Posted by guest , Mar 20, 2009 9:52AM
@27 Don't forget Baldwin and Tina Fey. Too see those 2 caught in this web would almost be worth the price.
Posted by guest , Mar 20, 2009 9:57AM
Remember a few weeks ago when a DB poster asked what the marginal tax rate would be on the "fat cats" making over $250,000? I bet he didn't think it would be 90%.
Posted by guest , Mar 20, 2009 9:57AM
@40 Unlike most of you, they have transferable skills.
This is hilarious. Bankers hate CNBC anchors, late night talks how hosts and sitcom actors now?
Posted by guest , Mar 20, 2009 10:01AM
@26 As a taxpayer I want the $1 which Liddy gets as salary to be returned. How dare he lie to Congress that AIG will be able to pay the US back? What you geniusses don't realize is that the AIG bonusses are being paid to the "mark-to-modellers" and the "hard-to-value" securities are CDO-squareds. It's only a matter of months before these go lights out. Then you the taxpayer get pay out on wipeout-squared.
Posted by guest , Mar 20, 2009 10:06AM
I don't believe that GE or GE Capital has taken any TARP funds. Can anyone provide details?
Posted by guest , Mar 20, 2009 10:09AM
Marx to market??
Posted by guest , Mar 20, 2009 10:09AM
@44 (and 27)--ge capital got $139 mill in gaurantees. no capital injection.
Posted by guest , Mar 20, 2009 10:11AM
From http://www.nytimes.com/2009/03/20/nyregion/20siege.html?scp=1&sq=bus%20tour&st=cse
The Connecticut Working Families party, which has support from organized labor, is planning a bus tour of A.I.G. executives’ homes on Saturday, with a stop at the company’s Wilton office.
I hope they deliver some toast.
Posted by guest , Mar 20, 2009 10:12AM
Hey, what happened to my TRADER magazine? I love reading about the swashbuckling hedge fund manager bsd's and I especially like those ads for Bentley, Breguet and AP.
Posted by guest , Mar 20, 2009 10:14AM
@48- um trader monthly closed dumbass.
Posted by guest , Mar 20, 2009 10:18AM
@49 sarcasm detector awol today?
Posted by Clown Capital , Mar 20, 2009 10:20AM
@43
Not if we create a new version of accounting! Let's call it mark to magic!
Posted by guest , Mar 20, 2009 10:23AM
TGFD hasn't heard "Bill of Attainder" talk or "Ex Post Facto" talk for a very long time.
I think Wall Street's "best and brightest" deserve a big round of applause here.
Why? Because their behavior, which gave us the "Credit Crisis", may now result in a "constitutional crisis" too.
The Guy from Delaware
Posted by guest , Mar 20, 2009 10:24AM
everyone is missing the point; the 250k is cumulative HOUSEHOLD income for TARP recipients... this bill is blatant wealth distribution and has nothing to do with accountability
Posted by guest , Mar 20, 2009 10:32AM
Anyone have a bill number for this legislation (the one mentioned in article to hit the committee on Tues)?
Posted by guest , Mar 20, 2009 10:37AM
If anyone thinks Goldman would have survived without TARP money and the AIG cash they are an idiot. Goldman was so smart they used to refuse to syndicate 2nd lien private equity loans because they were such great investments and wanted to keep them in house. Take a look at Goldman's level three assets back in the beginning of 2008/late 2007. Without Paulson they would be toast just like Bear and LEH. This talk about "talent" is hilarious, putting together a pitch book and a financial model that shows 15% EBITDA growth in every scenario is not a "talent", once you "walk away" from your TARP bank and try to find another high paying job you will realize that, that skill will get you $60K in virtually every other industry in the US right now. -buyside
Posted by guest , Mar 20, 2009 10:40AM
http://www.govtrack.us/congress/bill.xpd?bill=h111-1586
H.S. Bill 1586
Posted by guest , Mar 20, 2009 10:45AM
how is it ok that BHO made a joke about retards & the special olympics and there is no outrage yet? oh dear flaming jesus, would everyone be so up in arms if GWB had made the same remark. HE MADE FUN OF RETARDS!
Posted by guest , Mar 20, 2009 10:45AM
I for one, if this crap gets passed, am paying my bonus back. I would rather my ass of a company get the money than the 'tard government get one penny. Take that middle America. No soup for you!
Posted by guest , Mar 20, 2009 10:56AM
No, I'm not talking about the 90% bill. I'm talking about the one mentioned in the article.
I don't think it's been introduced yet - love to see the details. The Bloomberg article made it sound like performance-based bonuses would be acceptable - as long as they met the standards of the Treasury.
Posted by guest , Mar 20, 2009 11:26AM
Since Credit Default Swaps appear to be the core problem, here's TGFD's suggestion for dealing with the CDS crisis:
Uncle Sam should turn the current $45 Trillion, unregulated CDS market into a regulated market, closer in size to the $900 Billion it was back in 1999 by...
1) Restricting CDS payouts to only those entities who also own the underlying bonds, and then only after the actual bonds have defaulted, and only in the amount actually defaulted.
2) All 3rd-party CDS holders, those who don't own the actual underlying bonds, those with no real skin in that game other than the CDS premium they paid, and who comprise the vast majority of CDS holders, and who are expecting a big payday of OPM, should be permitted to get only their paid premium returned, and then only if there are sufficient funds available after the "proper" CDS holders are paid.
3) Going forward, CDS contracts will be written only for those entities who own the actual underlying bonds, and then only in the amount of the actual bond itself, and only once per bond.
TGFD doesn't know how congress would write the actual law that would empower my suggestion, but if they can do TARP, TALP, the Stimulus Bill, and the AIG-FP Tax, all on the fly, I'm sure they could do this as well, and pretty fast too.
In closing, I'll say, who cares if all those 3rd-party gamblers get paid? Will they have really lost anything?
The Guy from Delaware
Posted by guest , Mar 20, 2009 11:42AM
@60 so that reduces AIG's 1.6 trillion dollar to what? Will it make a difference? No.
Posted by guest , Mar 20, 2009 12:05PM
@#61...
TGFD is not just talking about AIG. I'm referring to everybody, to the entire CDS market. It will make a big difference.
The Guy from Delaware
Posted by guest , Mar 20, 2009 12:24PM
Geithener = complete and utter fail
Posted by guest , Mar 20, 2009 12:56PM
@60, you are like all the other idiots who think that banning naked CDS solves problems. Okay, so CDS buyers have to own the bond. Then, who the heck is going to sell that CDS buyer the protection? Umm....broker/dealers? Well, do you think that broker/dealers want to be entirely long CDS? They want to hedge it by buying protection. But they can't if naked CDS is banned. So that means that no one will want to sell CDS protection...so no one will be able to hedge their bond exposure by buying protection. Which in turn means that general corporate issuance will slow to a crawl as no Wall Street firm will underwrite an issue without being able to hedge it on their books. Oh, but of course, Wall Streeters are greedy losers who served no purpose. Let's just have Main Street underwrite trillions of dollars of corporate debt issues.
Posted by guest , Mar 20, 2009 2:18PM
guest@#64...
Thank you for the reply.
"General corporate issuance will slow to a crawl as no Wall Street firm will underwrite an issue without being able to hedge it on their books."
Did it ever occur to you that a lot of debt, corporate or otherwise, should never have been underwritten in the first place? "Greedy Wall Streeters" were quick to underwrite any piece-of-shit that floated by as long as they could collect a fee and buy a swap to protect themselves, and as long as Moodys/Fitch/S&P AAA ratings were available for the proper fee. TGFD's suggestion will clean that mess up.
"Okay, so CDS buyers have to own the bond. Then, who the heck is going to sell that CDS buyer the protection?"
If a bond is worth insuring, and if the underwriter and the bond purchaser did their proper homework, and if the ratings outfits weren't just selling ratings to anyone who'll pay, then the bond buyer will get his insurance. Otherwise, he won't buy the bond, and the bond may never be underwritten in the first place. And what, pray tell, would be wrong with that?
BTW, currently, another DB thread is talking about Goldman's big score on some AIG CDS bets. This is exactly WTF I'm talking about. This whole CDS market that everyone takes "Oh so seriously", is nothing but a huge balloon full of hot air, a house of cards, and a ponzi scheme all in one. The sooner Congress recognizes this and sticks a pin in the damn thing, the better, and the sooner we can start to recover, sans unregulated CDSwaps.
"Oh, but of course, Wall Streeters are greedy losers who served no purpose."
When it comes to shit-bond underwriting and to irrational CDSwaps, you are correct.
The Guy from Delaware
Posted by guest , Mar 20, 2009 11:01PM
@65 I am not 64 and you think markets are efficient. Please leave.