Wall Street End of Year Bonus Are Huge!

Everyone agrees Wall Street is having a bad year. Why are bonuses still in over the top? Someone must be profiting from the disaster of our economy, someone beyond the invest bank brokers. Someone is making billions selling stocks and equities short. And they are making sure the brokers who help them are rewarded for a job well done. Joe Kennedy did it in the Depression. There have to be hundreds profiting now from our misfortune.
Too Much

They don’t just make deals on Wall Street. They make myths. And last week Wall Street's myth-making machine was roaring at full throttle — after the news broke that America’s five biggest investment banks will this year shell out a record $38 billion in bonus pay.


To justify the financial industry’s annual bonus blitz, friends of Wall Street fortunes usually recycle some variation on that most elemental of investment banker fables, the wealth creation myth. Wall Street’s movers and shakers, we are assured, create fabulous wealth. They richly deserve an appreciable share of the wealth they create.


This year, that wealth creation myth rings a bit hollow. Over the last 12 months, the movers and shakers of Wall Street have presided over a colossal loss of wealth. Shareholders at Wall Street’s five biggest banks have lost $74 billion off the value of their stock holdings.


[..] Wall Street giants like Bear Stearns and Merrill Lynch, these mythologists acknowledged, have certainly registered big-time losses this year. But these powerhouses, the new myth goes, can’t afford not to shell out big bonuses.


“If Bear and Merrill plead poverty,” as Manhattan College's Charles Geisst opined, “they're going to lose all of their good people.”


But “good” people don’t lose billions betting on risky securities, do they?


True enough, the myth-makers also acknowledge. But not all power suits on Wall Street, they quickly add, have been wheeling and dealing in subprimes. The power suits who spend their time cutting corporate merger deals, underwriting initial public stock offerings, and trading currencies did just fine in 2007.


The bulk of this year’s bonuses, Wall Street’s cheerleaders are arguing, are going to these “successful” traders and bankers, not those wretches responsible for all that subprime unpleasantness.