Lifestyles of the rich and infamous
As if to put the icing on the cake, the investment bank Goldman Sachs is set to shell out another $5 billion in bonuses to employees.
What’s more, the bonuses are expected to cover the employees’ work for just the first three months of the year, according to the UK Sunday Times.
According to the report, bankers will receive remuneration of about $170,000 per person for the firm’s 32,500 employees. Some traders are set to receive millions.
Earlier this year, Goldman’s “junior” bankers were told they’d begin receiving salaries that were double their previous takes.
“It’s made me rethink everything,” a Goldman Sachs employee, “sipping champagne,” told the site. “I like the new structure even better. My monthly take home just went way up.”
I’m to the point now that every time I think of Goldman Sachs employees, I think of the dinner scenes at restaurants in the Sopranos or Goodfellas.
cleek
i think of the feast scenes in Caligula.
Cat Lady
Every time I think of GS employees, I think of tiny little pen1ses. It explains everything, with the added benefit of amusing me endlessly.
ellaesther
I have the same thing, I suppose, in that it just doesn’t seem that it can be real. After all this time, all these months and months of this shit, this is still some of the least humanly believable news I’ve read.
kommrade reproductive vigor
The kicker will come when GSack tries to claim the bonuses are charitable donations.
lawguy
Hey, those guys are smart they work hard. Oh wait where have I heard that before?
BenA
I’m obviously in the wrong line of work….
Violet
I think of Nero. They’re fiddling while we’re burning.
Zifnab
@BenA:
Fix’d. I’m sorry, you think the mega-banks hand out the plum jobs based on merit?
Punchy
Ice-T wants royalties for using this….
BenA
@Zifnab:
Hey my libtard and conservative friends assure me that it’s all based on merit.
MikeBoyScout
Bilking people and the whole global financial system is a lot harder than hijacking a truck from Newark airport, or shaking down some nightclubs.
GS employees earn all this dough!
Now, let’s all sing along….
I know I’d go from rags to riches
If you would only say you care
And though my pocket may be empty
I’d be a millionaire
Must I forever be a beggar
Whose golden dreams will not come true?
Or will I go from rags to riches?
My fate is up to you
Comrade Jake
Let there be no question about it: these people feel entitled to these salaries. After all, how can you afford two nannys in Manhattan without them?
“What do you get when you cross a Godfather with an investment banker? Someone who makes you an offer you can’t understand.”-Paul Krugman
Seanly
I have a good buddy from college who has spent his entire career at GS since ’91. I sincerely hope that he is not one of these douchebags setting their polciy. He always had a good head on his shoulders, but money corrupts…
I also hope that he wasn’t involved with these horrible practices by GS.
PeakVT
I suggest we sacrifice the banksters to the volcano gods.
Dave C
Somebody remind me: when do we get to put their heads on pikes?
russell
They are the most productive people on the face of the earth. Just ask them.
Ash Can
I have to say that, in general, I have no problem with people earning big bonuses. None. However, those bonuses must come out of the profit margin, which means after all expenses, including paying back in full any bailout funds lent by the government. I don’t think this is the case here, and that’s what makes me crazy. Furthermore, a quarterly bonus? How is that a prudent business practice? Oh yeah, that’s right. We’re talking about Goldman Sachs, aren’t we?
Bob K
When is the remake of “Wall Street” coming out? I hear Michael Douglas is reprising the role of “Gordon Gekko” – of course these days he’s a slacker compared to these sharks. I’m listening to Walnuts – “Pull the trigger on Iran” and am grateful for dodging THAT bullet. Mind you if we have a Romney/Paul/Palin/Gingrinch win in 2012 who knows what will happen? Rounding up “undesirables” and sending them to FEMA camps? Will there be a Beckian Youth Movement? Liberals for Limbaugh? Nostradamus wasn’t clear on this one. Damn Mayan calendar.
Peasants are People too!
rootless-e
r€nato
If we really had a socialist president, Obama would confiscate their bonuses.
kay
Come on. They deal in information, right? That’s how they make decisions? They knew.
From Terry Frieden
CNN Washington Bureau
Friday, September 17, 2004 Posted: 5:44 PM EDT (2144 GMT)
WASHINGTON (CNN) — Rampant fraud in the mortgage industry has increased so sharply that the FBI warned Friday of an “epidemic” of financial crimes which, if not curtailed, could become “the next S&L crisis.”
Assistant FBI Director Chris Swecker said the booming mortgage market, fueled by low interest rates and soaring home values, has attracted unscrupulous professionals and criminal groups whose fraudulent activities could cause multibillion-dollar losses to financial institutions.”
rootless-e
To me, GS business has become easier to understand if you consider each transaction as starting with a letter that goes something like
Greeetings:
I am former bank president of
Liberia BankWAMU and have located a $3405002239203290 account in your name. […]ericblair
@Ash Can:
My problem is that the term “bonus” lets them have it both ways. When business is good and they get enormous, eye-popping bonuses, it’s because they earned it: it’s not salary, you see, it’s commission where they went out and hustled for every last dime of it. When business is not so good and the firm has come close to blowing up the world financial system, and the employees get, er, well, enormous, eye-popping bonuses, it’s because it’s their salary, you see, that’s how they get paid and it’s unfair to take it away from them.
I kinda see what they did there.
pharniel
@rootless-e:
That’s a good way to get yourself marked for kdinapping.
russell
The “bonuses come out of the profit margin” part is key.
NYSE:GS
It’s not their f**king money.
Bob K
@cleek:
Google “Incitatus” if you have a chance – go ahead. Guaranteed laugh or your money back.
kay
@rootless-e:
They knew the underlying loans weren’t any good.
I’m curious what the argument is going to be if the grand jury return indictments here:
“That truism may apply in the criminal investigation by federal prosecutors into Countrywide Financial, which was the nation’s mortgage leader prior its spectacular collapse and fire-sale acquisition by Bank of America (BAC) in 2008. Two years into the investigation of the bank, a grand jury late last year began hearing witness testimony — signaling an acceleration in the process, and the possibility that this phase of the case may now be nearing its resolution, according to an article in The Wall Street Journal.
That resolution could take the form of the grand jury issuing indictments, or potentially not. Grand jury proceedings are conducted in secret, and the article notes it’s not clear who the targets of the investigation are, nor what potential crimes are being examined.”
GS is saying that the losers in this current transaction were “sophisticated actors” who should have known better. If we find out that there was fraud involved in the transactions that led to the underlying debt, what do they say then? That they, GS, a sophisticated actor if there ever was one, were fooled, by those crafty homeowners?
Doesn’t this “sophisticated actor” claim have to play both ways?
Joseph Nobles
“And then it was over.” – Henry Hill
ChrisS
Wow … is it that these guys are reaping massive profits because astronomical amounts of money is easily transferred today because of computers and electronic transactions? Has productivity soared exponentially in the financial markets because ten thousand transactions no longer need an army of traders or analysts. One banker can now do the work of hundreds of 1960s employees?
Of course, also included are the borderline illegal conduct, exotic financial instruments, and good ol’ fashioned ponzi schemes with 250 million americans “managing” their own retirement.
GregB
The Moonie Times is scraping the bottom of the Obama hate barrel with this latest hit piece.
Obama golfs instead of going to Polish President’s funeral.
Tsulagi
Pretty good when you now have the real Tonys and Guidos while eating their cannelloni at dinner talking about Goldman’s scores saying “We’re doing it fuckin wrong.”
kommrade reproductive vigor
@rootless-e: Congratulations. Would you like your Internets wrapped?
rootless-e
@kay: The key to understanding all this is the common Wall Street slang phrase
IBG/YBG
I’ll Be Gone/You’ll Be Gone
The people who really deserve to go to jail, first, are the ratings agencies.
cleek
@kay:
of course they knew.
they also knew that stopping the party would be the end of their careers. that’s the problem with all bubbles: even if they see it happening, a politician can’t do anything about it because:
a. the big boys aren’t done milking it, and will blame him for their losses.
b. the little people will get soaked and blame him for their losses.
c. this time, it’s different!
a & b directly threaten the politician’s career and c makes it OK to ignore until the bubble bursts – ‘nobody saw this coming”.
rootless-e
@Tsulagi: truer than most people know
http://tpmcafe.talkingpointsmemo.com/2007/03/08/myth_of_union_corruption/
Summary: Pension fund in hands of mafia was better for workers than pension fund in hands of “professional money managers”.
WereBear
I’m sure the reasoning behind quarterly bonuses is that if they wait, all the money will be tied up in litigation, and they don’t get to take it home.
Think of the homeless dollars that would languish in somebody else’s vault, instead of theirs. Unloved, unspent!
They are just averting a tragedy, that’s all. Now move along, raggedy scum.
LuciaMia
So, the SEC is finally doing it’s job. Are they trying to atone for Bernie Madoff?
Linda Featheringill
It might be good for employees of GS to pop their bonuses into savings accounts.
Just saying.
The Moar You Know
Unreal. I don’t know if my company will even be in existence this time next year, not to mention wondering whether I’ll still have a house.
I hate these people with every fiber of my being. They robbed us all, stuck us with the check, and are still walking around as free men, lighting cigars with hundred-dollar bills and bitching about how it is so hard to get good help anymore.
I am seriously rethinking my commitment to pacifism.
kay
@cleek:
Why doesn’t that impugn their credibility as investment professionals? They’re getting up there and testifying that “no one could have predicted” and they are in the prediction business, and the FBI’s certainly made a prediction that they were in for “massive losses”.
Is there some kind of wink-wink thing I’m missing here?
Not between the public and investment firms, but between investment firms and their clients?
The clients don’t say to themselves, “well, GS must have been staffed by morons if they were 3 years behind the FBI”.
OR, are they thinking “that crafty GS were betting against us, and that makes them really smart!”
PeakVT
@rootless-e: Don’t forget OPM – other people’s money.
Cat Lady
@kay:
Shut up, that’s why.
/Blankfein
Brachiator
You’re not far off the mark. Fabrice Tourre, who dubbed himself ‘Fabulous Fab’ in emails, was one of the bankers at the center of Goldman Sachs financial dealings. He loved to live large:
The UK Daily Mail (somewhat equivalent to the NY Post) has a good summary of the Goldman Sachs dealings that have led to the latest SEC investigation here.
ericblair
@cleek:
And that’s one of the reasons why the Holy Free Market will never stop this kind of shit. If you do the smart thing and try to pull back you will get run over and won’t survive to see the rest of the industry blow up. You need that awful wet-blanket parade-pissing-on regulation thing to stop things from getting out of hand, because actions done for the good of the individual actor do not magically make an outcome good for all. Anybody who doesn’t like it can go Galt themselves.
ajr22
Are the American people Artie Bucco in this analogy? Or the guy who gets the bottle smashed over his head in Goodfellas?
bemused
John, I want to thank you for putting up the cspan video of Barry Lynn discussing his book “Cornered”. Lynn was excellent. Definitely well worth taking an hour to watch. Now I must read his book.
arguingwithsignposts
I’m sorry. I *do* have a problem with people receiving huge bonuses. It leads to precisely this kind of shenanigans. Our entire system of compensation is whacked out. People who actually do *work* for a living make subsistence wages while rock stars, athletes and bankstas make more in a year than most people will make in a lifetime.
Sorry, that’s fucked.
kay
@Cat Lady:
I really don’t get the way they think. Not GS. I get that. But their clients.
“Off to the fleecing!”
It’s somehow really attractive to get robbed by such illustrious people?
They have to believe the following two things at the same time:
1. “the people at GS did not realize this was a horrible investment”
2. “the people at GS are brilliant at predictions”
If they don’t believe those two things, the only other possibility is this “the people at GS knew it was a horrible investment, and fleeced us, but that’s okay, because they’re really smart, so it’s our fault”.
rootless-e
@kay:
I wonder if GS told Buffet that it had received a Wells notice or if it slipped their minds.
kay
@rootless-e:
I just became familiar with the phrase “Well’s notice” yesterday, so I can’t comment, other than to hope that GS not giving notice is actionable.
Gregory
Every time I think of Goldman Sachs employees, I think of the marketing division of the Sirius Cybernetics Corporation (“a bunch of mindless jerks that were the first ones up against the wall when the revolution came”).
rootless-e
@kay: Frankly, I think they are in deep shit.
If I had purchased their stocks or given them money to manage and found out later that they had been warned of an intention to sue for screwing their customers and that they had not bothered to tell me, I’d be talking to a law firm or two.
WereBear
@rootless-e: I’m in total agreement.
It’s their own, turning on them, that will really mess them up.
And they have both the money and the motivation.
Bob L
@Cat Lady: Picture a bunch of nerds who are now being told they are the cool kids.
Mnemosyne
@ajr22:
I think we’re the kid in Goodfellas that Tommy shoots in the foot and then murders when he complains about it.
(If you haven’t seen the movie lately, that kid is played by future “Sopranos” star Michael Imperioli.)
mai naem
Gee, whatever happened to the BJ posters who always say “Bbbbut it’s not illegal.” I’ve been listening to Bloomberg today and I am amazed at how “objective” the reporters/hosts are being. My god, I am wondering when the last time I heard so much reticence in just going along with the prosecutor’s charges. Even Martha Stewart was pretty much convicted before she actually agreed to the deal.
rootless-e
@mai naem: Martha Stewart is a Democrat.
licensed to kill time
These guys gotta have pretty big sacks to put all their gold in, man. Gold Man Sacks.
ThatLeftTurnInABQ
@The Moar You Know:
Ditto that. Ever since 2008 I’ve been grabbing books and reading what I can about Gilded Age. Two things stand out in notable contrast to our current era: (1) back then there were elites both in the media and finance who actually cared about the country as a whole and wanted to fix things that were obviously broken, and (2) some very angry folks were blowing shit up and killing rich people. I can’t help wondering if that is a total coincidence, or if there was a causal relationship between those two factors. I do hope we can somehow get (1) without (2) one of these days, but my optimism on that score is being tested.
rootless-e
@licensed to kill time:
from the Austin O’Henry Pun Off
————
http://www.punpunpun.com/22928.html
My name’s Smith Barneycle. I was Schwabing down the decks as we sailed the bankrupt seas on the outer Banks of America. The day was a Capital One. “Guten Morgan, Stanley,” I said ponzi’ing our Earnest & Young captain. He said, “that’s a NAS DAQ you’ve cleaned.” I said, “‘Tis Deloitte Touch I use.”
But then PIRATES on the Horizons! He said “They’re giving Chase, Man! Hattan down the hatches!! We are Madoff money. We’ve got Gold, man! Sachs of it! If they cash us they’ll bonus! I said A I ..Gee, captain!
So Frost we headed to the Norwest, but they State Street behind us. The pirates’ First National aboard was AMEX…ican, named Fidel, a Tijuana resident. I shouted “Comerica! I’ll Merrilly Lynch you!” But he was Regions for his gun. I said “IMF’d!”
“Let’s make a Countrywide alliance. I offer you a Mellon dollars. Let’s make this ship a Prize Waterhouse of finance.”
The captain said “What is that USA,A? UBS-ing me? This is the First Union I’ve ever seen. I’ve MetLife and I’m Fed up with it. USTrust someone and they Wachovia. I Wells Fargo my duties and resign.”
I said “GMAC Captain now! Why would E-trade places with me? Oh, well, it’s Ameritrade, and I’m Citi pretty.”
licensed to kill time
@rootless-e: I take my hat off to such superior punsmanship.
scarshapedstar
I think of the Nazis-locked-in-a-burning-theater scene in ‘Inglourious Basterds”.
Brachiator
@ThatLeftTurnInABQ:
We must be reading different books.
Whenever I read about the era, I keep running up against robber barons and people whose unabashed selfishness was equalled only by their glee in crushing the poor.
And for me, the epitome of the excesses of the Gilded Age was perhaps the Bradley Martin Ball of 1897.
By comparison, the annual wage for unskilled labor and manufacturing workers in 1897 was about $133.
What other books are you reading? Are there any that you particularly recommend? I recently bought The First Tycoon: The Epic Life of Cornelius Vanderbilt, by TJ Stiles, but have not yet had a chance to get to it.
Comrade Kevin
@Gregory: It really is too bad that Douglas Adams is no longer with us.
ThatLeftTurnInABQ
@Brachiator:
I recommend Kevin Phillips’ Wealth and Democracy, and the Edmund Morris bios of TR as a good place to start, and then harvest their bibliographies as you see fit. I agree about the outrageousness of the things which went on back then (such as the examples you quoted) – my point is that the same era also featured a strong and active muckraking progressive press, various elitist do-gooders who tried to push for reform in health and sanitation (for example they worried that epidemiology would not respect class barriers during a pandemic), and recognition by even such luminaries as J.P. Morgan that the existing financial system was broken and in need of fixing for the sake of both economic and social stability, or else the markets would crash and the reds and blacks would threaten revolution from below. In the latter case it is particularly instructive to read about the back room negotiations by which TR rounded up support and financial donations for his re-nomination campaign in 1904, in the process securing endorsement from very conservative business newspapers, i.e. the equivalent of the WSJ today.
Can you point to anything which is comparable today, aside from perhaps Soros and a few of the tepid noises that Warren Buffett makes from time to time? Can you imagine the WSJ reluctantly but firmly coming out in support of Obama’s re-election in 2012 (not in the news section but on the op-ed pages) ? The very idea is laughable.
Sad_Dem
I like John Robb on bomb throwing. The GS folks say they are sure the free market solves problems, and he’s got examples of how good old free enterprise can put buyers and sellers of guillotines together.
Alan in SF
I’m to the point now that every time I think of Goldman Sachs employees, I think of the dinner scenes at restaurants in the Sopranos or Goodfellas.
Me, I’m thinking the restaurant scene in “Brazil” all the way.
Brachiator
@ThatLeftTurnInABQ:
I think I might have the Phillips’ book lying around somewhere. I’ll add the Morris bio to my list. Thanks.
I’d read about JP Morgan’s efforts to help stabilize the financial system during the Panic of 1907. Morgan acted as a de facto Federal Reserve head — that institution did not exist yet and came about in part because Morgan’s forcing bankers and other financial types to get together and co-operate proved effective in resolving the crisis. Businessman James Stillwell was also instrumental in getting the financial leaders together during this crisis. On the other hand, In 1876 Stillman had supported Porfirio Díaz’s overthrow of the government of Mexico by the Revolution of Tuxtepec.
The PBS program, The American Experience, featured a good profile of Morgan, which may still be available online here.
ornery curmudgeon
@Bob L: @Cat Lady: Picture a bunch of nerds who are now being told they are the cool kids.
No, these are the bullies.
These are the slick Good Ol’ Boys. Players. The Winners who backslap and backstab with equal good humor.
Nerds are the scapegoats the Winners threw out.
Salt and freshly ground black people
Goldman banksta’s refrain:
I wanna be a billionaire, so fricking bad
Sell some CDO’s and make a wad
I wanna be on the cover of Forbes magazine
Smiling as I destroy your 403(b)
Oh every time I close my eyes
I see my name in shining lights
A different sucker every night oh
I swear the world better prepare
For when I’m a billionaire