Bonus Watch '12: Jefferies Has Got Your Cold Hard Cash Right Here

Back in the day, as in pre-crisis, bonus season on Wall Street was a happy time. Sure, you still had your miserable pricks who would bitch and moan about the fact that they hadn't gotten as much as the guy who sat next to them, even they the guy who sat next to them was a "non-contributing zero who wouldn't recognize alpha if it bit him in the ass," but prior to to fall 2008, anyone who was unhappy about his or her bonus was a) quibbling over receiving a huge sum of money instead of an imperial fuck-ton of money and b) in a position to actually make good on a threat to jump ship, since firms were hiring. Now, with a few exceptions, bonus season makes people feel sad. Angry. Impotent. Like the world is out to get them. Not only has the total amount of one's bonus come down, but many companies have decreased the cash portion, while increasing the deferral period on stock to, in some cases, almost half a decade. Then you have Jefferies. Last year it let employees decide between an all stock bonus or an all cash bonus with 25% lopped off.  This year the investment bank-cum-butcher shop isn't even forcing anyone to choose, instead dumping a bag of cash on everyone's desk and reminding them who loves 'em.
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Back in the day, as in pre-crisis, bonus season on Wall Street was a happy time. Sure, you still had your miserable pricks who would bitch and moan about the fact that they hadn't gotten as much as the guy who sat next to them, even they the guy who sat next to them was a "non-contributing zero who wouldn't recognize alpha if it bit him in the ass," but prior to to fall 2008, anyone who was unhappy about his or her bonus was a) quibbling over receiving a huge sum of money instead of an imperial fuck-ton of money and b) in a position to actually make good on a threat to jump ship, since firms were hiring. Now, with a few exceptions, bonus season makes people feel sad. Angry. Powerless. Frustrated. Confused. Like the world is out to get them. Not only has the total amount of one's bonus come down, but many companies have decreased the cash portion, while increasing the deferral period on stock to, in some cases, almost half a decade. Then you have Jefferies. Last year it let employees decide between an all stock bonus or an all cash bonus with 25% lopped off. This year the investment bank-cum-butcher shop isn't even forcing anyone to choose, instead dumping a bag of cash on people's desk and reminding everyone who loves 'em.

The decision to pay immediate cash is a departure from some competitors’ compensation structures. Morgan Stanley capped 2011 cash bonuses at $125,000 and deferred an average of 75 percent of employees’ payouts, up from 40 percent two years earlier. Zurich-based Credit Suisse Group AG awarded a portion of 2011 bonuses for more than 6,000 bankers in bonds backed by derivatives that will pay out over several years. “It is no secret that virtually every one of our bank holding company competitors is forcing onto their employees extremely high levels of non-cash compensation with long vesting periods or compensation in the form of cash to be received well into the future,” Chief Executive Officer Richard Handler and executive committee Chairman Brian Friedman wrote. “You can’t spend non-cash compensation or unpaid cash to buy a home, purchase groceries, invest in your life or help out friends and family.”

Of course, this gesture of love and appreciation has got to be a two-way street, which is why in the same memo Dick and Brian noted that they would be extending gardening leave periods, should anyone be getting any ideas about seeking employment elsewhere, which they know you would never do, since there's not a bank on the Street that'll keep ya warm at night like they do.

Jefferies Vows Immediate All-Cash Bonuses as Bigger Banks Defer [Bloomberg]

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Bonus Watch '13: Jefferies CEOs

Dick Handler ended up doing pretty okay for himself.

Layoffs/Bonus Watch '12/13: Morgan Stanley

Back in January, Morgan Stanley CEO James Gorman sent a simple messages to his employees, who had been grumbling about their pay: STFU or GTFO. "You're naive, read the newspaper, No.1," Gorman told Bloomberg he would say to any members of his staff that wanted to give him lip about their compensation to his face. "No. 2, if you put your compensation in a one-year context to define your over all level of happiness, you have a problem which is much bigger than this job. And No. 3, if you're really unhappy, just leave." Today, in an interview with the FT, Gorman reiterated his stance and added that in addition to reducing compensation for current employees, the bank will likely be drastically cutting pay for future analysts. If anyone has a problem with that, consider applying for a gig at Bank of Mythical Pre-Crisis Era Bonuses. Alternatively, Gorman is happy to discuss a compensation plan in which you'll be awarded shares of his foot in your ass, which vest immediately. In the latest sign of the pressure Wall Street is under to cut costs and address high pay levels, James Gorman, chief executive, said that staff and remuneration would have to be sacrificed as banks cope with lower profits. “There’s way too much capacity and compensation is way too high,” Mr Gorman said in an interview with the Financial Times. “As a shareholder I’m sort of sympathetic to the shareholder view that the industry is still overpaid.” Morgan Stanley itself is already axing 4,000 jobs, 7 per cent of its workforce, by the end of this year. In the new year, Mr Gorman said, the bank will consider its next round of cost-cutting, including lower pay and bonuses. News of further pay cuts, including potentially for new entrants at the investment bank, comes just weeks after Goldman Sachs confirmed it was overhauling its well-known entry-level programme for analysts. Goldman was said to have tired of the number of analysts in the programme who left the bank for hedge funds. Mr Gorman said that Morgan Stanley will probably keep its own analyst programme, but pay could be reduced significantly. Morgan Stanley Chief Warns On Wall Street Pay [FT] Earlier: James Gorman To Employees: STFU Or GTFO

Bonus Watch '12: Now With Less Cash

According to "revenue compensation trends," though good vibes and happy thoughts could prove them wrong. Wall Street’s cash bonus pool is likely to fall for a second straight year as the financial industry grapples with market turmoil, economic weakness and new rules, New York state Comptroller Thomas DiNapoli said. Revenue and compensation trends have “edged downward” since February, when DiNapoli estimated that the 2011 pool for Wall Street declined by 13.5 percent to $19.7 billion, the comptroller said today in a report. “Based on those trends, the total cash bonus pool for work performed in 2012 is likely to decline for a second year in a row,” DiNapoli said in a statement. The last time the pool shrank for two consecutive years was in 2007 and 2008, at the beginning of the global financial crisis, according to the comptroller’s office. Wall Street Bonus Pool Seen Shrinking for Second Straight Year [Bloomberg]