AIG to Pay Mega Bonuses Next Year Too
If AIG dishing out $167 million in bonuses for 2008’s performance has made you considering a run to the hardware store for a pitchfork, you might want to add torches to your shopping list too.
The employee retention plan that set in stone paying out massive bonuses for 2008 to the mad scientists of the financial products group also specifies another hefty payout for 2009 – and the checks will be almost as large as the ones just handed out. According to a copy of the employee plan (a copy is posted here), senior management are guaranteed bonuses at least 75 percent the size of their 2007 awards, while non-senior management employees are guaranteed bonuses 100 percent the amount of their 2007 payouts. That’s the same rate as the current bonuses were set at, and are benchmarked against 2007, when the valuations of the credit derivative instruments the department created were still believed to be worth something. The only ones not getting the 2009 retention bonus? Those who have left the company. Of course, Congress may still weigh in on altering or taxing bonuses in some form.
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Wow. I hear even Eliot Spitzer is outraged (see http://www.nytimes.com/2009/03/19/business/19spitzer.html?hp/0. That can mean only one thing . . .
Yes, but I trust that the vast majority of those bonuses will be trickling down to the rest of us…that’s how it works, right?
No trickle down. Bankers are unlike any other creature out there. They do not need to spend any of their income on home maintenance, childrens education, vacation, cars, or even magazines and newspapers so the world is better off without the few hundred thousand of them that obviously did nothing but go home and conjure up ways to sell a reverse amortizing interest reset mortgage to a poor seventy year old widow.
Congress fully realizes this today with their brilliant decision to take a portion of the population and tax it at 90%. So the computer programmer at Morgan Stanley who has as much to do with the subprime crisis as the editor of Vogue magazine is properly hosed. Thank goodness. He must have been a jerk any how because he made over $250,000 a year and anyone that makes that ludicrous a sum of money in the financial world is obviously a crook. We should go after them like witches in Salem or like Hitler convinced an entire country to hate a different segment of the population with similar brilliant logic. Anger can cause a lot of stupidity.
Who was supposed to be supervising the activity of these AIG guys and banks and the activity of ratings agencies and the laws that allowed Freddie and Fannie to take on so much leverage? It seems legally it was the Fed and Congress, but that cant be. They obviously had nothing to do with any of this as the head of the NY Fed while this was all going on is now head of the Treasury and Congress is clearly very angry that they had no idea about this. maybe it was the Boogie Man? Lets go get him.