Lordy, lordy, somebody hand me my smelling salts and take me over to the fainting sofa please, because the United Kingdom has just issued an ultimatum to the 'High and Mighty Bankers' in their country regarding the new 'Bonus Laws' that have recently been issued by the UK Regulator known in their country as the Financial Services Authority (FSA).
This new 'tough stand' is not going to make our own Pay Czar, Kenneth Feinberg a 'Happy Camper' as he sits around twiddling his thumbs, directing his secretary to issue the 'Standard Outrage Memo' to the media, like he did this week regarding the $100 million in a fresh round of bonuses to AIG employees of its financial products division, (the unit whose risky bets helped sink the company leading to a $180 billion government bailout,) in addition they are also due to pay out tens of millions of dollars more in March, mostly to former employees who did not agree to the 'certain' concessions.
Dear me, Mr. Pay Czar, the British are coming, the British are coming....
In an extraordinary ultimatum that has shocked some of the City's biggest companies, the Financial Services Authority (FSA) told bank bosses that 60pc of all pay must be deferred, with no exceptions, even for those whose contracts conflicting with the edict. Many of the global players have in recent weeks made representations to the City watchdog, in particular about pre-existing employment contracts that guarantee bonuses over a year or more. But their appeals have been met with the FSA's toughest yet response.
One pay executive in a major bank told The Daily Telegraph: "The message came back that while the FSA agreed that it does not have jurisdiction over contractual law, it does have jurisdiction over issuing bank licences in London, and that we should go away and unwind the contracts."
One Merrill Lynch employee said: "We thought that contracts would be immune from changes but were told by bosses that their hands were tied and there was nothing they could do, the regulator had put its foot down." One headhunter said: "Many of these contracts have guarantees that 50pc of the bonus will be paid in cash. These are tricky things to unpick. But cleverly, the FSA has put the onus on the banks to unwind the contracts, rather than itself getting embroiled in a complex legal row." Banks that have not yet told staff about the bonus payouts are now scrambling to ensure that they are comply with the FSA rules.
Wow, excuse me while I fan myself with my 'southern belle' fan, but hearing sentences from Bankers like these:
'We thought 'our' contracts would be immune from changes..' (but they're not you greedy little bastards.. now are they?)
and...
Banks that have not yet told staff about the bonus payouts are now scrambling to ensure that they are comply with the FSA rules.
and...
'the FSA has put the onus on the banks to unwind (their own fucking) contracts......'
.....just sends shivers down my spine knowing that the UK and the FSA have put down their foot and said to all these 'risk taking, hedge hog greedy, sub-prime predatory lending, fraud snake oil salesmen' to STFU, and comply with the 'new bonus laws,' screw your 'pre-existing contracts, or we are pulling your damned Banking and Investment Licences, and then you'll all have to go and get a real job working on the docks in Liverpool, or working at Harrods Department Store selling 'kitchen ware in the 'cook it, try it, and taste' it exhibition booths.
God, don't cha just 'love it?'.....
A little on the history of the new 'bonus laws' in the UK:
The FSA's position is the culmination of nearly a year of debate over how to curb huge sums paid out in remuneration by banks. In March, the regulator wrote to the bosses of the major investment institutions explaining that it was preparing a code designed to limit excessive pay in the aftermath of the financial crisis. The consultation was followed in August by the publication of guidelines that demanded pay had to be calculated in relation to overall over risks.
The FSA issued guidelines on best practice for remuneration committees as well as recommendations for deferrals, claw-backs and a lower proportion of cash payouts. When it found that some companies still planned to award multi-year guarantees and cash bonuses in the face of mounting political and public controversy, the regulator began to take a harder line.
In October, Lord Turner, chairman of the FSA, said he had "a range of levers'' at his disposal to block "excessive bonus payments''. "We will be talking to banks about whether their bonus pools are appropriate and if they aren't we will have a full and frank discussion with them,'' he said. At the time Lord Turner declined to detail the measures available to him.
http://www.telegraph.co.uk/...
Thank you 'Lord Turner'....do you think you could possibly talk to our 'Lord'...Pay Czar, Kenneth Feinberg, and perhaps let him borrow your 'set of brass balls' for a few months?
Can you ever, imagine, even in your wildest dreams, our Treasurer Timothy Geithner or 'the arsonist'..Ben Bernanke standing up in our nation telling all the Bankers that they 'Must Comply With New Bonus Laws - Or They Would Have Their Banking/Investment Licences Pulled?'
Oh, wait....I forgot, we don't have any 'Bonus Laws'....
Bankers justified their massive paychecks by pointing to the outsize returns many investors received during the credit boom. But even after crashing the economy, bankers are still finding ways to lavish themselves with compensation. The bankers at the nation’s six largest banks – Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Morgan Stanley – are on pace to take home $150 billion in bonuses, benefits, and compensation in 2009, 19% more than their high during the peak of the financial boom in 2007.
Total bailout funds received*
Goldman Sachs $63.6 billion
JPMorgan Chase $94.7 billion
Bank of America $199.0 billion
Wells Fargo $36.9 billion
Citigroup $341.1 billion
Morgan Stanley $25.0 billion
2009 Projected Bonuses & Comp.
Goldman Sachs $22.3 billion
JPMorgan Chase $29.1 billion
Bank of America $32.2 billion
Wells Fargo $26.3 billion
Citigroup $25.0 billion
Morgan Stanley $14.5 billion
This massive windfall for bankers comes straight out of taxpayers’ pockets. After taking nearly $17.8 trillion in bailouts to stay afloat, banks and other financial firms are still relying on taxpayer-funded programs to generate their profits. Along with the now-publicized TARP investments, debt guarantees, AIG payments, and emergency lending programs, big banks are also benefitting from a Federal Reserve commitment to pump $1.25 trillion into the market for mortgage-backed securities, which has fueled a speculative trading boom that is currently propping up bank earnings.
Instead of ramping up risk-taking and lavishing bankers with excessive bonuses and compensation, the banks could be contributing to a real economic recovery. The top six banks are on pace to pay $150 billion in bonuses and compensation this year, which translates to $577 million every day or $72 million every hour. Even a small portion of the bankers’ total bonuses and compensation – just days or hours of pay, in some cases – could make a huge impact at the national, state, and local levels.
http://ourfinancialsecurity.org/...
Hats off to the United Kingdom for laying down the law to their out of control Bankers. Tip tip, Cheerio and all that rot....
Somehow, it doesn't make me feel the slightest bit confident that with the present 'Congressional Whores' on the Banking Finance Committee who are doing everything they can to put the kibosh on Elizabeth Warren and President Obama's plan to have a real Consumer Protection Agency in place in the near future, is really in the long run going to make a difference with these Bankers and their hideous 'bonuses'...and when Lloyd Blankfein the CEO stated recently that if Goldman Sachs were to go 'belly up' that we, the taxpayers would once again have no other choice but to bail them out....again, I can't help but feel like a hostage being held by the Mafia Banking Cabal, known as Wall street.
And it doesn't help when you finally come to the reality and conclusion that is staring us all in the fact, regardless of how we try to smooth it all over and play party politics....that both parties are working for Wall Street, and could give a rats ass about Main Street.
Wall Street firms and their executives have been uniquely generous to both political parties, emerging recently as one of the largest benefactors of the Democratic Party. Between November 2008 and November 2009, Wall Street firms and executives handed out $42 million to lawmakers, mostly to members of the House and Senate banking committees and House and Senate leaders. During the 2008 elections, Wall Street showered Democratic candidates with well over $88 million and Republicans with over $67 million, putting the Street right up there with the insurance industry as among the nation's largest equal-opportunity donors.
Some Democrats are quietly grumbling that all the tough talk emanating from the White House in recent weeks -- the President calling the Street's denizens "fat cats" and threatening them with limits on their size and the risks they can take, even waiving a watered-down version of Glass-Steagall in their faces -- is making it harder to collect money from the Street this mid-term election year. And the Street is quietly threatening that it may well give Republicans more, if the saber-rattling doesn't stop.
Congress isn't doing a thing about Wall Street because it's in the pocket of Wall Street. Dodd's outburst at the Street is like the alcoholic who screams at a bartender "how dare you give me another drink when all I've done is pleaded with you for one!" Dodd is right about one thing. The American people are frustrated, and the failure of Congress to pass real financial reform is insulting. But in trying to place responsibility for this appalling failure on Wall Street, Dodd insults us even more.
http://www.huffingtonpost.com/...
Anyone that doesn't realize that both Shelby and Dodd are working on the same team are simply deluding themselves. They play a great game of 'good cop, bad cop,' but in the end they are not fooling anyone, least of all the American people who are now watching as Wall Street are collecting the all time highest bonuses in the history of our nation, after these same rat bastards are the very ones who brought our nation to it's knees putting 25 million people out of work, stealing their retirement and life savings, and forcing unprecedented foreclosures sending our nation into the Great Depression II.
The Times isn't sure whether the bonuses will just be really big or super giganormously absurd, but in any case they'll be a lot more than the rest of us suckers Americans will ever make in one year: "Goldman Sachs is expected to pay its employees an average of about $595,000 apiece for 2009, one of the most profitable years in its 141-year history. Workers in the investment bank of JPMorgan Chase stand to collect about $463,000 on average." The sheer bigness of these numbers has got some bankers worried that those nosy-busybodies from Washington might start asking uncomfortable questions, or maybe even clawing back some of their winnings through a special tax. Britain has put that kind of tax in place- raising more than $10 billion dollars this year.
And what's worse, some experts even have the temerity to ask if Wall Street has really learned anything from the tribulations of the last year: "There is nothing I’ve seen that gives me the slightest feeling that these people have learned anything from the crisis. They just don’t get it. They are off in a different world"— and that's coming from John Reed, one of the founders of Citigroup. And he's not the only one who's upset: some of the pesky bank shareholders have begun to ask whether finance industry is a heads-we-win-tails-you-lose kind of system.
But let's be honest: Wall Street has nothing to worry about. We'll be writing this exact same post twelve months from now— and there's not a damn thing any of us can do about it.
http://gothamist.com/...
I guess that last sentence is true at the rate things are going in our nation, that we will probably be writing the exact same things about these 'bonuses' twelve months from now, because somehow I just don't think that between this year, and next year, we are going to find Timothy Geithner or Ben Bernanke standing up at the podium together telling the Banks:
'Here are the new Bonus Laws - Comply With Them or We will Pull Your Banking/Investment Licences.'
Senator Bernie Sanders noted a few simple actions that Ben Bernanke, Chairman of the Federal Reserve could do TODAY, that he refuses to do in favor of Wall Street over Main Street:
"Democrats and President Obama are putting their credibility on the line if they think they can criticize Wall Street and big banks one day and then turn around and support Bernanke, Wall Street’s candidate, the next day," Sanders said. "That doesn’t pass the smell test."
"The issue for Democrats is whether they will allow Republicans to pretend to be the populist, anti-Wall Street party, or whether they will have the courage to stand up to Wall Street and bring in a Fed chairman who will represent the needs of working families rather than huge financial institutions," Sanders added.
Sanders has demanded that the Fed use its powers to substantially lower outrageous credit card interest rates, protect homeowners facing foreclosure and to make affordable credit available to small and medium-size businesses. He also has demanded increased transparency at the Fed and the names of financial institutions that took more than $2 trillion in secret subsidies from the central bank. Bernanke has refused.
If our own Congressional Whores refuse to even put the slightest pressure on Bernanke to perform these acts of 'mercy' on Main Street during these desperate times, the idea that Bernanke would actually threaten our own Bankers on Wall Street with pulling their licences, like the FSA has done in the UK shows the stark and ugly reality of just who is in charge of our nation's well being, and once again, this puts America to shame in comparison to what other countries in Europe are already doing to straighten out there 'key financial sectors' demanding that the bonuses be regulated, 'or else.'
How many of your are willing to call your Senators (including members of the Banking Senate Finance Committee) and ask them point blank:
'Can you tell me why you Senator, having reelected Ben Bernanke, there are have absolutely no demands or action taken on these three simple actions, that are well within the power and duty of the the Federal Reserve to take immediately?' These actions are: its powers to substantially lower outrageous credit card interest rates, protect homeowners facing foreclosure and to make affordable credit available to small and medium-size businesses.
Good luck with getting a rational response, or having the Senators and Banking Finance Committee, never 'getting back to you' on these questions. But if you do take that action, I would love to hear back from you, as to what occurred and what specifically the 'answers' were given to you concerning this lack of 'very reasonable actions' that are being ignored.
Oh, well, God Save The Queen......I think I'll have a 'spot of Sherry' in honor of her Majesty, and toast her totally kick ass Banking Regulator, Lord Turner, chairman of the FSA. God knows we sure could use a few men like him 'kicking some Banking Bonus Butts' around here.
Thanks...