The big financial houses have a problem. They’re slated to pay billions in bonuses this year . . . and they’ve taken in billions in taxpayer money so that they can live to make that payday. This from the WSJ . . .
In a sign that Wall Street is waking up to the political tempest over billions of dollars in year-end bonuses likely to be paid out at securities firms lining up for government infusions, top executives are in discussions to possibly cap their own compensation, according to people familiar with the situation.
While the discussions remain fluid and many details still must be agreed to, the talks underscore an emerging consensus among some of the securities industry’s most powerful executives that the escalating pay controversy is creating yet another public-relations mess for Wall Street.
Ya think?
The problem here isn’t, or at least shouldn’t be the executives. If they can’t figure out that they need to cap their comp, at least their cash comp, Congress will show them the way. It’s the big “producers” that everyone worries about. If you don’t pay the big bucks, they walk away.
Two questions . . .
1. Where will they walk to? The choices are dramatically reduced from a year ago.
2. Do you really think they won’t anyway? If they’re that good, my bet is they’re talking to the private equity guys and the hedge funds already.
Tags: Executivepay, TARP, decision making
