>>How can any company pay out billions of dollars in bonus, when the comapny lost money?
You’re thinking of these companies as monolithic entities. There’s been a lot of consolidation on Wall Street and when a smaller company gets acquired, their bonus pool is often kept separate based on their own performance rather than the company-wide performance. So, a company can be an overall loser, but the few REALLY profitable sub-units will still be paying out big bonuses.
By the way, there are lots of organizations with pathological problems that think of themselves as meritocracies (La Cosa Nostra).
This reminds me a lot of the movie in the 80’s — WALL STREET ( where we got the phrase “Greed is Good”). Has anyone out there ever stop to consider if what they’re doing has any real social or economic value ? Are they really creating anything ?
The Mafia believes that they are too.
So when it’s “bonus time” the small companies are independant; but when the company fails, everyone goes bankrupt.
Sorry, the banking industry is no different from any other large industry. If the processor division of Intel makes big bucks, but the memory and motherboard and chipset divisions all lose money - then INTEL didn’t make money. At that point, no one gets a bonus - that is the way you keep a large company in business.
Now, frankly I wouldn’t cry at all of these big companies fold, inept managment is its own reward. A smaller and better ran company will simply assume a larger role. However, when Pres Bush and Pres. Zero put a gun to the head of the US Taxpayer and take money out of our pockets, and place a debt onto our children, so they can give it to poorly managed companies - I have a problem with that.
Especially, since after TARP 1 and TARP 2; they have not changed the way they conduct business. Why the heck should they? There have been ZERO consequences for playing fast and lose with our money. What are you going to do? Take away their birthday?
No, until they learn that there are consequences to their actions, there is no reason for them to change the way they run their business. Once again, the Gov’t has rushed in and screwed a completely viable business model.