Bailout Robberies Make Bankers Very Happy

27 October 2008

http://img291.imageshack.us/img291/9558/cbe1080924lr9258824xk6fi0.jpgThe global economy has been turned on its head from this year's stock market crash. Investment banks like those in America receiving $700 billion in funds from the Congressional Bail.

You might expect them to use this cash as wisely as possible, but it appears that Wall Street has different priorities, with very little care for the Americans and the global market.

According to the New York Times, the nine largest commercial banks, which include Citigroup, Merrill Lynch, Morgan Stanley, and Goldman Sachs, have held on to the cash as a "cushion" for their own operations instead of lending the funds to consumers.  At the same time, the market continues to fall flat on its face, and taxpayers like you and me are lying flat on our backs.

To add insult to injury, Wall Street investment bankers and financial staff will still receive more than $70bn (£40bn) in yearly bonuses for their work this year.  According to Time magazine:

Johnson predicts the average managing director at an investment bank, a title typically earned around eight years on the job, will receive a bonus of $625,000. That's down from nearly $1.1 million last year, but it is still 15 times the income of the average American household. Top bankers could receive as much as $1 million. Even a bond trader just out of business school could see his or her bank account enriched by as much as $170,000 this Christmas. "The firms have had an extremely difficult year," says  "But they can't afford to lose talent either."

And just in case you weren't devastated enough, Firedoglake blogger Ian Welsh drives the dagger right into your heart, adding:

"What's worse is this: all profits for Wall Street for the 3 prior years have now been wiped out by this years losses. So, in other words, the people being paid bonuses haven't actually made any money for their companies for going on four years now."

I admit: I never liked banks, and especially not one that pockets taxpayer's hard earned "emergency funds" to limit their own sacrifices. For workers hired to be improving performance of a market that has declined to depths exceeded only by the stock market crash of 1929, this certainly sounds more like a heist than a helping hand.

[NYT] / Cartoon courtesy of Clay Bennett

TOPICS:   Banking

2 comments

  • Christine H.
    Huge bank profit. Does that seem right to you? An insider's club report showed last week why Wall Street never fights fair (and neither we should). Big banks exposed: Now I could understand why we never have the freedom to do what we want to do.It is sure the big banks dont want us to see this.
  • Good F.
    yeah, Thanks very good for report,I follow your blog :)

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