See- The Economy Is Fine

For some people:

Pay on Wall Street is on pace to break a record high for a second consecutive year, according to a study conducted by The Wall Street Journal.

Compensation on Wall Street is on pace to break a record high for a second consecutive year, as more than three dozen top banks and securities firms will pay $144 billion in salary and benefits. Elizabeth Rappaport, Bob O’Brien and Neal Lipschutz discuss. Also, Guggenheim Partners’s Scott Minerd discusses why he thinks that despite record highs, gold can be expected to rise even higher.

About three dozen of the top publicly held securities and investment-services firms—which include banks, investment banks, hedge funds, money-management firms and securities exchanges—are set to pay $144 billion in compensation and benefits this year, a 4% increase from the $139 billion paid out in 2009, according to the survey. Compensation was expected to rise at 26 of the 35 firms.

The data showed that revenue was expected to rise at 29 of the 35 firms surveyed, but at a slower pace than pay. Wall Street revenue is expected to rise 3%, to $448 billion from $433 billion, despite a slowdown in some high-profile activities like stock and bond trading.

So if the tea party is so anti-corporate as we have been told, surely the Republicans have a plan to rein in these ridiculous profits and to address unemployment on main street, right?

34 replies
  1. 1
    Odie Hugh Manatee says:

    If you go by the metric that the worse we do then the bigger bonus they ‘earn’, then it’s clear that they have ‘earned’ every penny of their bonuses. In fact, I bet the biggest (and last) bonuses they get will be the year they finish siphoning off the rest of the cash we have.

    After that, they can hang their “Mission Accomplished” banner and party all night.

  2. 2
    Omnes Omnibus says:

    Well, that’s a relief. I was quite worried.

  3. 3
    wilfred says:

    What are the fuck are you even talking about, John? Tea party, Republicans??

    Why don’t you ask the party in fucking power if they’ve got a plan to rein in ridiculous profits? Or is that question objective support for Sarah Palin?

    Talk about projection.

  4. 4
    Dennis SGMM says:

    That’s why I’m so glad that the .25% tax on stock trades didn’t go through and that capital gains continue to be taxed at 15%. Every time I see a Gulfstream go overhead, every Maybach that whispers down the street makes my heart take flight as I’m scrounging for recyclables.

  5. 5
    comrade scott's agenda of rage says:

    The Tea Partiers Republicans will say what their Wall St paymasters tell them to say.

    When was the last time you actually heard one of those crackers actually spout off some anti-corporate sound bites?

  6. 6
    jonas says:

    $144 billion is a bargain when you think about it for all the producing these producers produce. I mean, without them we wouldn’t have… Um. Lemme think here. I’ll get back to you all in a minute!

  7. 7
    eemom says:

    Can we direct a “Green Balloons” at the emmessemm?

    The onslaught of outrage and insanity has reached a truly unbearable level.

  8. 8
    Ash Can says:

    So if the tea party is so anti-corporate as we have been told, surely the Republicans have a plan…

    This sums up what to me is one of the most thoroughly brain-dead aspects of the Tea Party. They rail against the bank bail-out, but don’t want anyone to do anything to prevent it from happening again.

    We often say here that in a just world, stupidity should hurt. I believe that in many ways, it does hurt. But these people are too brain-dead to realize that they’re in pain.

  9. 9
    Omnes Omnibus says:

    @wilfred: The tea party folks claim to be against the big banks as part of their populist schtick. If they truly are populist anti-corporatist as they claim they are, they should have something to say about issues like this. Yet they don’t. This puts the lie to their anti-corporate and anti-bank rhetoric. This particular post is not about doing something about Wall Street profits; instead, it is about the hypocrisy of the right-wing populists.

  10. 10
    Face says:

    But they live in uber-expensive NYC, so that $144 billion is more like $289.31.

  11. 11
    themann1086 says:

    These assholes really didn’t learn anything from FDR saving their butts from torches and pitchforks, did they?

    When the revolution comes, they’ll be second against the wall. First goes to our failed media experiment.

  12. 12
    wilfred says:

    This particular post is not about doing something about Wall Street profits; instead, it is about the hypocrisy of the right-wing populists

    Oh. What about left-wing populists?

  13. 13
    inthewoods says:

    What’s so interesting about this is that these guys were complaining about how Obama is so anti-Wall Street and business – yet somehow, they’ve managed on yet again making more money than God. Amazing how a little complaining about how your feelings have been hurts allows you to make billions without anyone questioning it again. Remember – Obama is the problem.

    Makes me think of this:
    http://i.imgur.com/k6Aoz.jpg

  14. 14
    Zifnab says:

    But… but… but… why should bankers be punished for their success? If these Galtian Geniuses can bring in $144 billion in net revenue when the economy contracted just the year before, why on earth shouldn’t we let them keep all of it?

    I think the real problem here is that the capital gains tax – at a whooping 15% – is just too damn high. If we reduced it or removed it entirely, we could really see the producers start producing and perhaps we could finally pull us out of the Recession that Obama’s terrible economic policies have dragged us into.

  15. 15
    LittlePig says:

    The system is working as designed. Carry on.

  16. 16
    jonas says:

    @comrade scott’s agenda of rage: Exactly. They weren’t upset about TARP because billionaire bankers got bailed out and Main Street got screwed. That was gravy. They were *really* upset because the bailouts then allowed the government to set pay and bonuses for these guys. Soshulisum! The bailout they really flipped out over was the mortgage assistance program that threatened to give average, working class people a lifeline on losing their homes. Remember Rick Santelli’s rant on CNBC that got the whole ball rolling? About to lose your house? Fuck you! Should have thought about that before deciding to get unemployed and not have a trust fund.

  17. 17
    Omnes Omnibus says:

    @wilfred: I don’t know. Cole wrote about one thing. Writers do that. If he wrote about everything related to every issue in every post, he would need to write Tolstoy-length posts every couple of hours.

  18. 18
    Zifnab says:

    @wilfred:

    Why don’t you ask the party in fucking power if they’ve got a plan to rein in ridiculous profits?

    Um… we did have a plan. We had the revised Volcker rules, we had windfall profits taxes, we had increases on the capital gains and general income tax rates, we had the per stock purchase fee (at a fraction of a penny per share) that would discourage the wealth destructive effect of high frequency trading.

    All of these ideas were presented by Democratic Senators and House Representatives. All were gutted out by Democratic “moderates” and Republican obstructionists before the Financial Reform Bill could pass.

    Please don’t give us this long winded whine about how Democrats, as a political party, just don’t care. There are at least a hundred DC Congressmen willing to pass good legislation. Unfortunately, you need 219 in the House and 60 in the Senate if you want any true reform.

    We have a plan. We simply don’t have the votes.

    And after 2012, we’ll have even fewer votes.

    That’s the grim reality of American politics.

  19. 19
    El Cid says:

    If the government were to do anything about employment, it would be Stalinism. If the government would do anything about mega-high compensation (i.e., such as higher taxing), it would be Robert Mugabe theft of golden eggs. This is the TeaTard way.

  20. 20
    Jules says:

    The first comment after the article pretty much says it all:

    Anyone who works a.k.a. slaves on Wall Street 10-12 hours/day and is tethered to his Blackberry 24/7 deserves everything they get in salaries and bonuses. Considering how many hours they put in and how hard they work and how much wealth they generate for the country and New York and considering how much taxes they pay, they are just a bit less paid per hour than the public sector parasites and unions who get $80-100K/year for working 2-3 hours/day, if that. And the no-show jobs and corruption and greed is much uglier in the public sector than on Wall Street.

    These journalists should be more careful about what they write, their envy is showing. Hey, no one held a gun to their heads forcing them to become journalists, they could have become traders on Wall Street. It is inappropriate to show so much envy and resentment to Wall Street. People should curb their envy and greed.

    See.
    SEE!
    Why does no one understand? Those Wall Street SLAVES work pretty damn hard for that money. DAMN HARD.
    and look UNION parasites provide no service at all!
    and envy, you iz wallowing in ur envy….
    Please, please understand how damn hard it is to work inside ever freaking day tied to your BlackBerry even when one is using the crapper.
    OH, the HUMANITY11!!!111

  21. 21
    Brighton says:

    The purpose of national wealth is to improve the life of the average worker, not the wealthy elite. Every percentage point added to the gap between the rich and poor in this country represents a failure of society to properly distribute wealth. It is the job of government to engineer the economy such that ordinary people get higher wages, low prices, adequate health care, police protection, justice, education, leisure time, and retirement security. I judge an economy on how well it is providing these things, whether through public or private systems.
    David Brooks blamed it all on civil service pensions in an op-ed today. How can he justify Wall Street bonuses but not reasonable pensions to actual workers who, btw are ineligible for social security?
    My response to Brooks here

  22. 22
    wilfred says:

    @Zifnab:

    Then you fucking lost. I supported Obama, when a lot of people around here were Clinton or Edward supporters, because they and McCain were simply unthinkable.

    He was a transitional President in a move towards the left, the same movement you’re constantly deriding at the same time you recognize that your party is corrupted and essentially controlled by its die-hard conservative elements.

    Your argument is that that’s the best that can be done. It isn’t.

  23. 23
    Ash Can says:

    @wilfred: You’re barking up the wrong tree. There should never be plans in place to rein in profits per se. If your business plan is a winner, it will result in big profits. Yay you. The proper place for regulation is in making sure those profits come fairly and legally. The question of who, if anyone, is getting hurt over the course of those profits being generated is the one that must always be addressed. Secondarily, the question of what’s being done with those profits indicates an opportunity for fiscal planning. There was a lot to be said for the tax rates of years ago that encouraged reinvestment and provided for government services. Now, if you want to argue that the old tax framework served as a way to “rein in” profits, I might not agree on a technical basis but I’d see your point. Stepping directly into business plans and deliberately limiting profits, however, is a short route to disaster.

  24. 24

    I think it’s important to remember that the only reason they’re working that hard is because the Bush Tax rates are still active.

    As soon as they have to pay 1 penny more in taxes, all of those billions in profit and productivity will disappear.

  25. 25
    ChrisWWW says:

    I agree with wilfred.

    At this point it’s just a diversion to talk about the Tea Party in this context. Bank profits are not obscene because of the Tea Party, and the Tea Party isn’t in a position to change anything right now.

  26. 26
    WyldPirate says:

    Damn, I seem to remember that President Nixon implemented wage and price controls and 1971.

    Fucking amazing that Our Savior Who shalt Not Be Criticized–President Obama— is to the right of Nixon.

    Way to be tough on those Wall Streeters who stole trillions, Barry. You were almost as tough on them as you were all of the criminals in the Bush administration.

    Hooray Barry! USA! USA!

  27. 27
    ruemara says:

    @WyldPirate:

    God, you’re a moron and an asshole. Congrats on being a multi-tasker.

  28. 28
    R. Porrofatto says:

    three dozen top banks and securities firms will pay $144 billion in salary and benefits

    To put this number in perspective, in 2006 the total combined profits of Chrysler, Ford, GM, Honda, Toyota, Nissan, and Volkswagen was $12 billion.

    The Wall St. parasites are bleeding the world dry. We’re all working for them.

  29. 29
    WyldPirate says:

    @ruemara:

    It’s called sarcasm you stupid fuckwit.

  30. 30
    gene108 says:

    My brother had an interesting counter-argument to big bonuses. The big bonuses are a model other industries should follow. Basically the companies reward the people, who work for them for value they provided to the company, rather than socking the money away or paying dividends to the owners.

    I just don’t know how much of the money trickles-down to the rank-and-file, but if it did it would be worth revisiting my less than warm-and-fuzzy views on these bonuses.

  31. 31
    blahblahgurgleblegblah says:

    That’s over 1% of US GDP going to a few hundred people, most of whom make absolutely _nothing_ and simply push around paper. This is outright kleptocracy.

  32. 32
    sparky says:

    @Ash Can: actually, no–there are all kinds of ways to make money in this “system” that are inefficient, destructive, unhelpful or otherwise simply siphon money without adding any value. additionally, society prohibits ANY profits in certain kinds of industries because it considers the costs outweigh the benefits. there is no reason–other than a faith best labelled religious in nature–that profits that come with high externalities should not be either taxed, prohibited or prohibited through confiscatory taxation.

    @ChrisWWW: yes. maybe john is just feeling like he needs to troll the blog, but complaining about how tea party people are incoherent hypocrites is pretty old news. much more to the point, if i may (ooh i must :P) it does exactly zip to alleviate the problem* and reason that so many people are unhappy with DC, namely, that Obama and co. contrary to their claims, had two years to do something, and all they came up with was repeating what Bush did–extend and pretend, along with an illusion of “reform.”

    now, we can have a debate about whether that was a good idea, but let’s not pretend that there was ever any serious move towards FIRE sector reform by anyone in the Obama administration. so, for example in this case, the anger is justifiable, if misdirected.

    in the foolish hope of forestalling the inevitable bad faith misreading, this is not to suggest that the teabaggers are not pawns in the game of “Billionaires for Billionaires”, only that the Ds offer no meaningful alternative to Rs on this point.

    *it’s a problem whether the subject is motivating voters or if the subject is what passes for “policy”. “my opponent is a hypocrite” is fine when things are going swimmingly, but when the “dream” such as it is, is drowning in the bathtub, pulling the plug is more efficient than pointing fingers.

  33. 33
    sparky says:

    @blahblahgurgleblegblah: yes, when you consider that the source of these payments is, literally, the UST. it’s one thing to fleece your fellow citizens; it’s another level of state failure altogether when you are openly taking money for the general weal and converting it to private wealth with the government’s blessing.

  34. 34
    Jay Banks says:

    They should be made to pay all of their profits into a fund that will pay for the next bailout of big banks instead of the miniscule 0.001% of their profits !

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