In the rest of the working world, the downside risk is still the same, just not the upside potential. That is why folks outside wall street have no sympathy for them.
Let’s summarize his reasons as to why Wall Street pays so well :
* Trading stocks, doing IPOs, merging companies, managing money is a very lucrative business. Not everyone can do it. It’s hard. Wall Street hires in that 99 percentile zone. And then they make your life miserable hoping you’ll quit before they break you. Or hoping they break you before you lose money for the firm.
* The score, like an SAT test, is kept with real money—how much your trading desk makes for the firm—how big a chunk of the bonus pool you command for your do-or-die heroics day in and day out.
* The job ain’t fun. ou have to one up on the Goldman Sachs of the world, generate as good a return on equity and earnings growth so that you could win the meritocracy game and get paid in spades. How dare Bear Stearns’ CEO make more than ours! Let’s lever this sucker up with mortgage-backeds and create a trillion-dollar balance sheet. If not us, who?
Every company I have ever heard of, has a ‘gating function’ to determine if any bonus is going to be paid to anyone.
Did the company make a profit?
If the company did not make a profit, no one gets a bonus. If the company made a profit, the bonus paid is a function of how much profit was made.
How can any company pay out billions of dollars in bonus, when the comapny lost money? Is it any wonder they went belly-up?
And then the well-paid take significant risks to stay that way, because the guy sitting next to them is doing just that, and damn the exposure next year to what made you the profits this year. I wouldn't care, except that the likes of GS and MS now expect Uncle Sugar will backstop their risk-taking. So I'm on the hook for their downsides.
If it’s such a meritocracy, then how did Corzine last so long?
I am sure all those who saw their 401k’s dive off the cliff will feel better now, knowing how dynamic the Wall Street guys are.
parsy, who says we should maybe make the work on Wall Street a whole lot easier for them, by banning hedge funds, most derivatives, and imposing the transaction tax
I really, really resent politicians, business folks, sports figures, etc. who have never spent day one in uniform talking about what "warriors" they are, and how they've "done battle" on Wall Street, or on the football field.
I suppose these people have an inferiority complex and really feel the need to portray themselves as soldiers for self-aggrandizement, but it really rings hollow with me, and lessens them in my eyes.
This current economic disaster was almost exclusively caused by the banksters (with Dim politician assistance). How many paid the price for their stupidity and greed? Not very many - they were bailed out by Bush, Paulson, Timmy the Tax Cheat, and the Dhimmocrats.
One of the things I enjoyed about being a salesrep was the “I’ll cut you some slack because you are putting-up the numbers, or I’ll have security escort you from the building immediately” attitude that prevailed in the office. That being said, I didn’t consider myself a “warrior,” although our casualty-rate was high . . . and I didn’t have Uncle Sugar bailing me out for stupidity.
I guess its the hypocrisy of the premise.
Every major firm on Wall Street was on the brink of failure for taking suicidal mortgage debt, packaging them into securities, buying those securities, and then whipping small and medium banks into signing and selling more suicidal debt.
They lose trillions, literally, these ‘warriors’. They go crawling to Main Street, looking for a handout.
They get it, and now they are back to talking about why they have a ‘true meritocracy?’
It’s like the 30 year old living in his mom’s basement bragging about his prowess at ‘Guitar Hero’.