These big league MBA's deserve a bit more credit. They knew that racking up big gains sourcing and securitizing debt would result in big bonuses in '03, '04, '05, '06, and even '07. Now a bunch get laid off in '08. But if you have 5 years of good bonuses on Wall Street, you can coast for a while. Not to mention, who really wants to work Wall Street hours for more than 5 years anyway.
It's really all about incentives. Short-term incentives in this case, which are paid for taking long-term risks.
Entry: Merrill Slashes Outlook For Banks, Market Slashes Merrill With Write-Down Rumors
posted by jaems
Jun 20, 2008 12:55PM
These big league MBA's deserve a bit more credit. They knew that racking up big gains sourcing and securitizing debt would result in big bonuses in '03, '04, '05, '06, and even '07. Now a bunch get laid off in '08. But if you have 5 years of good bonuses on Wall Street, you can coast for a while. Not to mention, who really wants to work Wall Street hours for more than 5 years anyway.
It's really all about incentives. Short-term incentives in this case, which are paid for taking long-term risks.