AIG Must Pay Back Bonus Money

[Soultrader 12]

Article located here: http://www.cnn.com/2009/POLITICS/03/18/aig.bonuses/index.html

 

73 employees got bonuses over $1million. Are they for real? Absolutely disgusting.

[firewalker 10]

Article located here: http://www.cnn.com/2009/POLITICS/03/18/aig.bonuses/index.html

 

73 employees got bonuses over $1million. Are they for real? Absolutely disgusting.

 

Disgusting yes, but totally surprising? Not really...

 

How about all the banks spending government money on sport sponsorship?

[Harlequin 10]

Disgusting yes, but totally surprising? Not really...

 

How about all the banks spending government money on sport sponsorship?

 

Mmmmm.....

[zdo 20]

Somehow, I just can't seem to get nearly as disgusted that AIG passed on the money as agreed as I get that ANY bailouts ( the first, next, and coming) were ever allowed to happen at all...

 

...it's sheer hypocrisy...want to see something that is disgusting to me?

 

A Community Bank Punished For Prudence

 

One might think that a bank with no foreclosures, no loan losses, and no loan loss provisions would be top rated. If so one would think wrong. The clowns at the FDIC gave a negative rating to such a bank last week.

 

...

 

Joseph A. Petrucelli is one of the most cautious bankers in America. In fact, Petrucelli is so cautious that the Federal Deposit Insurance Corp. recently criticized his bank for not lending enough. The FDIC’s negative review of East Bridgewater Savings Bank’s loan volume is an anomaly in today’s current banking scene as lenders reel from their role in offering too many cruddy mortgage products to borrowers with weak credit.

 

Bad or delinquent loans? Zero.

 

Foreclosures? None.

 

Money set aside in 2008 for anticipated loan losses? Nothing.

 

“We’re paranoid about credit quality,” Petrucelli said. The 62-year-old chief executive has run the bank since 1992.

 

Still, the FDIC slapped East Bridgewater Savings with a rare “needs to improve” rating after evaluating the bank under the Community Reinvestment Act. FDIC examiners also faulted East Bridgewater for not advertising and marketing its loan products enough.

Congratulations go to Sheila Bair and the FDIC for helping take asininity to new heights.

 

[Eiger 10]

Somehow, I just can't seem to get nearly as disgusted that AIG passed on the money as agreed as I get that ANY bailouts ( the first, next, and coming) were ever allowed to happen at all...

 

I agree with you about the bailouts ...

 

Re: disgusting: Think about the the poor schmuck who lost his job in December after 15-20 years with the company and now has a hard time making ends meet. He looks at AIG and thinks, Gee, these guys helped create this recession that cost me my job and may even cost me my house, my taxes have helped bail their cookies out of insolvency, and then they get big bonuses! In this guy's mind, disgusting is probably too mild a term.

 

And then there are many others who are still working but are really scared they will be losing their jobs next. They see themselves trying to do the right things, believe they've worked hard, and never thought about getting rich, just make a living. But now they are living in fear that the axe will fall on them and they really don't know what to do. They have no clue. Then they look at AIG and see people getting major rewards for doing the wrong things. The smarter ones see AIG not only as getting caught up in greed and doing the wrong things, but refusing to acknowledge that experience and continuing to be greedy by taking bonuses when undeserved. Fool me once, shame on me; fool me twice ...

 

People are very pissed off.

[zdo 20]

I agree with you about the bailouts ...

 

Re: disgusting: Think about the the poor schmuck who lost his job in December after 15-20 years with the company and now has a hard time making ends meet. He looks at AIG and thinks, Gee, these guys helped create this recession that cost me my job and may even cost me my house, my taxes have helped bail their cookies out of insolvency, and then they get big bonuses! In this guy's mind, disgusting is probably too mild a term.

 

And then there are many others who are still working but are really scared they will be losing their jobs next. They see themselves trying to do the right things, believe they've worked hard, and never thought about getting rich, just make a living. But now they are living in fear that the axe will fall on them and they really don't know what to do. They have no clue. Then they look at AIG and see people getting major rewards for doing the wrong things. The smarter ones see AIG not only as getting caught up in greed and doing the wrong things, but refusing to acknowledge that experience and continuing to be greedy by taking bonuses when undeserved. Fool me once, shame on me; fool me twice ...

 

People are very pissed off.

 

Yes I can sympathize with these emotional reactions - but codde ignorance and stupidity ? No Way! John Q. Lostjob and Joan E. Maylosejob are outraged that these ‘bonusees’ expect to get the agreed upon pay for putting together deals. BUT, somehow, they are not outraged that the govt is increasing John and Joan own personal debt in increments of freakin $100,000 at a time and that members of Congress’ real motivation for forcing these liabilities on to John and Joan is to keep their seats/ own jobs /power... talk about major rewards for doing the wrong things! And John and Joan are not just getting fooled once. They are getting fooled again and again... and we're supposed to be 'understanding' ?! Fwiw, a large % of these John's and Joan's work(ed) in financial services and sales and would not be voluntarily giving their agreed upon 'bonuses' back if the shoe were on the other foot... they would not feel doing the jobs they were hired to do was doing the wrong thing.

 

btw - The ‘bonues’ were forbidden in the original bill…After all the ‘blame game’ attacks on the republicrats, it now turns out obama (’s crew) called dodd and said put it back in to allow the bonuses... This culture is going insane. When I read comments like “… “Maybe, just maybe we have a President who really wants to do some good” it hits me just how lalaLand things are getting. The peeps will have to learn the hard way, narcissists never actually want to do some good.

[Eiger 10]

Politics upset you, eh? This has been going on since forever, and is unlikely to change. I think, though, it may be wider than just the bonuses at AIG -- that's the current scapegoat. When you get a chance, take a look at the clips from 'Stewart vs. Cramer.' There are three parts (link to the first only, but you'll see the other two parts on the site). It's maybe 15-minutes in total. I sense the potential for a much wider outcry. Within that discontent, people are looking for a place to lay the blame. And it most certainly won't be on themselves.

 

http://www.thedailyshow.com/video/index.jhtml?videoId=220536&title=jim-cramer-pt.-1&byDate=true

[fitzkie 10]

Governement is controlled by the financial elite.

 

AIG was given billions so they could pay at 100% of value the fiancial elite. Do some research the 800 billion bailout has turned into 9 trillion with no transparency.

 

B

[AgeKay 10]

Before being disgusted at everyone who receives bonuses even though their bank is being bailed out, have you considered that a few of these people had actually made their bank money?

 

For example, there might have been 10 people in one department doing market making in currencies which made 100 million. Do these people not deserve their bonuses? Of course, it is out of question that the loan department where another 100 people work that lost several hundred million or even billion does not deserve bonuses.

 

Is it fair that bank employees that have nothing to do with all of this get laid off? No! But this is the risk you take being an employee. You let others decide...

[JBWTrader 10]

I have to agree with AgeKay to some extent,

If an employees renumeration package is based partly on the achievement of the overall corporate goals AND on the achievement of individual performance goals then in this eg with AIG they should get nothing for the overall corporate goal achivement and whatever % their personal goals related to their achievment.

 

However...

 

It is always a test of the HR practices to strike a balance here when setting this up and of course the reviewing process. What can be difficult is linking a persons direct responsibilities/Authority/Tasks or JOD to the direct financial measures of performance/achievements. Its often very difficult to find clear direct one to one indiv employee achiements with a direct finacial one. Hence often there are departmental goals for achievement also included.

 

Each case needs to be looked at Individually within the context of individual,department/section and coporate goals/achievements of course.

 

What complicates it with AIG eg is that I hear many of their financial goal achievements were not Reality based (as it turns out )...wow, no wonder people are calling for a general withdrawal of monies earnt as bonuses.

However each case still needs to be looked at individually.

 

I can say that in the future because of the furore with AIG more and more of peoples personal goals and department goals will be linked to the overall goals of the company(and as they should be) in a more realistic financial sense.

 

I make these assertions on limited info about the case, so excuse me if I am incorrect anywhere with the facts. Thats another story again with this particular case in general I believe.

 

All the Best

 

John

[MightyMouse 12]

I have to agree with AgeKay to some extent,

If an employees renumeration package is based partly on the achievement of the overall corporate goals AND on the achievement of individual performance goals then in this eg with AIG they should get nothing for the overall corporate goal achivement and whatever % their personal goals related to their achievment.

 

However...

 

It is always a test of the HR practices to strike a balance here when setting this up and of course the reviewing process. What can be difficult is linking a persons direct responsibilities/Authority/Tasks or JOD to the direct financial measures of performance/achievements. Its often very difficult to find clear direct one to one indiv employee achiements with a direct finacial one. Hence often there are departmental goals for achievement also included.

 

Each case needs to be looked at Individually within the context of individual,department/section and coporate goals/achievements of course.

 

What complicates it with AIG eg is that I hear many of their financial goal achievements were not Reality based (as it turns out )...wow, no wonder people are calling for a general withdrawal of monies earnt as bonuses.

However each case still needs to be looked at individually.

 

I can say that in the future because of the furore with AIG more and more of peoples personal goals and department goals will be linked to the overall goals of the company(and as they should be) in a more realistic financial sense.

 

I make these assertions on limited info about the case, so excuse me if I am incorrect anywhere with the facts. Thats another story again with this particular case in general I believe.

 

All the Best

 

John

 

 

I am pretty certain that the people who got the huge bonuses at AIG where not the people who were responsible for AIG taking on those huge risks. They were in fact people who were hired by AIG because of their ability to place huge amounts of securities with large investment groups, pension funds, foreign governments, fund managers, and other misc institutional investors. These guys and gals were hired away from other companies to come to work for AIG because of their talents. AIG may as well close the doors completely if they cannot place the debt instruments that they underwrite. These "bonused guys" have the ability and connections to place massive amounts of securities. It has zero to do with risks that AIG took. It's just difficult for Mr. Front porch to conceive of someone getting millions in a bonus from a near bankrupt company.

 

Having the govt regulate how much all the employees get paid will result in a talent drain since those who will be effected the most will simply move to a company that is not being regulated. The regulated companies will all flop or have to severely change the way they do business. The result will be forced failure after we inject billions. Not a good plan.

 

The guys that negotiated the guaranteed bonuses will ultimately get paid. It will wind up in court, we will pay extra fees for litigating the case, and they will ultimately get paid because it was a contract. Another bad plan.

 

Not wanting them to get their bonus is an emotional thought. As in many other parts of our lives, letting your emotions make decisions for you is never a good idea.

[zdo 20]

Eiger,

re

Politics upset you, eh?

:doh: Yep I need to drop it and image creating the new after this system completely crumbles itself... Actually at this point I am more upset that I am doing the rant instead of millions and millions of fellow earthlings than I am about the 'politics'.

...here is another dumbass wasting his time yelling about what's wrong instead of creating something functional...

 

The distraction on Capitol Hill this week has to do with the jackpot bonuses that executives at AIG recently received. The argument is over a relative drop in the bucket. The total amount of bonuses given out was $165 million. The government has put $170 billion into AIG so far. Many now are demanding we get this money back. We ought to be spending our time and effort doing something more worthwhile, like figuring out how the Federal Reserve is handling the trillions of dollars they are creating and pumping into the economy, and how that is affecting the purchasing power of dollars in your pocket.

The big mistake was appropriating the TARP funds in the first place. A Johnny-come-lately bill of attainder won't stop the spending epidemic. This whole situation is a perfect demonstration of why "doing nothing" and letting failing companies fail would have been much better than sinking valuable money and resources into them.

When a company makes a profit, it is a signal that it is taking resources and increasing their value while controlling costs. When a company operates at a loss, it is a signal that it is decreasing the value of its resources or letting out-of-control costs outstrip any value it has created. A company operating at a loss is therefore an engine of wealth destruction. Bankruptcies are a net positive for the economy because more productive competitors are rewarded by opportunities to buy up remaining assets at bargain prices to strengthen their operations. In an economy that allows this kind of growth and change, any jobs lost by bankruptcy are soon replaced by new ones as the most efficiently managed businesses gain access to more assets and expand.

Bankruptcy was the stimulus that we needed in the case of AIG. More bankruptcies would clean out malinvested resources and enable economic growth again.

AIG, by losing money and maneuvering their operations to the brink of bankruptcy, was telling us that they were inefficient. So what did we do? We forced the taxpayer to assume the losses, and now we are supposed to be shocked that it is not working out. Had AIG gone bankrupt, it would have been impossible to hand out these bonuses. The taxpayer would have been fleeced for $170 billion less last year. Had they gone bankrupt, the world would not have come to an end, it would just continue on with one less engine of wealth destruction.

We should have learned from Japan. The 1990's is referred to as Japan's "lost decade" because of the zombie banks kept on life support by the Japanese government. Any productivity was redirected through these engines of wealth destruction, resulting in long term stagnation. We should and can avoid this outcome if we come to our senses.

A recession should be a time of strengthening and regrouping for an economy. But as long as the government insists on maintaining the status quo by propping up failed institutions, we will continue to dig a bigger hole for ourselves

Ron Paul 3/23/09

[Eiger 10]

... Actually at this point I am more upset that I am doing the rant instead of millions and millions of fellow earthlings than I am about the 'politics'...

 

I resonate with Ron Paul and the Libertarian outlook. When I first read Ayan Rand a number of years ago, I didn't think I could continue to live and work in such a dysfunctional system. Virtually everything I saw smacked of statism and the mindless crushing of the individual. Her work had an enormous impact on me, as have the Austrian Ecomomic school of thought (Von Mises, Rothbard, Rockwell, et al). I did withdraw from being an employee of the system, as now I am simply a trader and a psychologist with a small private practice with as minimal a connection to the statist system as I can manage. I found that ranting about the obvious (and I was pretty loud) always fell on deaf ears.

 

Paul's surprize that we failed to learn from Japan is really no surprize at all. We will nearly always opt for the instant gratification, even when it is against our best interests long-term. Our behavior is really no different than the addict's in this regard. Even though expensive, it felt "right" that we were doing something now with AIG despite knowing it runs counter to capitalism and will work against us in the end. It's the same thing we (i.e., our politicians) did in Afganistan and again in Iraq. Back then we wanted to do someing now, even though it made no long-term sense.

 

Eiger

[olie1018 10]

Why don't you focus on the real facts? the real issue is much bigger than aig... the bonus money is barely over 1% of the total amount... you sound like you are a sound bite junkie manipulated by the liberal media... corruptocrats in hollywood, d.c., americans addicted to sound bites, being apathetic, ignorant to the facts, and selfish... these are the real problems, just to name a few...

 

jim

[zdo 20]

Why don't you focus on the real facts? ...

jim

 

I really wish I could oblige you but here’s all I got today…

 

http://www.safehaven.com/article-13035.htm

 

 

and PS

 

Been busy packing my bug-out-bag, readying the remote retreat and stocking up on 100 Things that Disappear First. While we're waitin' on 1Q09 earnings, howz about a review of the some of last year's conspiracy theories and a look at where they are now.

You'll remember reports of new, family-oriented prison camps being built around the US; reports that battle-hardened troops brought back from Iraq would be stationed in cities throughout the country; that fighter planes were flying between skyscraper canyons in those cities; 500,000 plastic coffins were being stored in Atlanta, home of the CDC; plans to supplant the US dollar with a North American currency, which was superseded by plans for a NWO currency; complete loss of faith in the US along with worldwide financial collapse; and natural disasters of biblical proportions indicating the end of times.

Old news now perhaps, but they sure sounded like conspiracy theories at the time.

Then there's this one, which is still circulating and has more traction than UFOs. It's the most audacious of them all and it was, and continues to be, that we've hit the bottom. The bottom of what and defined how you ask? The bottom of everything -- Peak Bottom -- defined by any financial-performance metric whatsoever, no matter how insignificant, even as small as a Kudlow mustard seed. And here's what I think of this one -- to I quote The Mogambo Guru, although not necessarily on this subject -- hahahahahaha.

Camping, FEMA Style

This is government at its best. I'm serious. Jobs were created and money was saved by flipping WWII Japanese-American remote retreats and repurposing a few FEMA shelters to create new, family-style, involuntary housing facilities. So now you know where the recent uptick in multi-family construction permits and government employment came from.

At least some of the campers will be refugees from the Mexican-American drug wars. Troops of both countries have been amassing at the border for some time. And, Dubya's back in Texas, one of the hot spots, a whoopin' and a hollerin' to "Bring them on!" We know how that worked out the last time. Hahahahahaha (hat tip to TMG).

Concentration, internment, or armed-guarded human enclosures by whatever name are the kind of places where there's always room for one more. This summer's rioters (see below) will need involuntary accommodations and, who knows, the country could be called upon again to further victimize natural-disaster survivors, as was the case after Katrina.

Battle Stations in a City near You

War-hardened troops from Iraq reassigned for duty on US soil? Is this constitutional? What's the constitution these days anyway; it's a bit late to worry about that now. Troops have been at their new battle stations in US cities for months. According to the latest from the Army Times, the original plan for 20,000 will be increased to as many as 80,000.

Troops at the border, troops in the cities, and fighter pilots overhead -- bet you think it's to foil the Mexican drug gangs, right? No, the army states flat out that troops are being "readied to deal with what could be widespread civil disorder resulting from an 'unforeseen economic collapse' or 'loss of a functional political and legal order." Something to keep in mind as you plan your summer vacation this year.

Related, are reports around the country of searches and/or drills conducted jointly by local law enforcement and other uniformed personnel such as members of the National Guard and federal agencies including the Bureau of Alcohol, Firearms and Tobacco and FBI. So far, tickets have been issued and locals have been traumatised. It's something we'll have to get used to, which is the point, after all.

Oh, and Blackwater got kicked out of Iraq and they're back too.

End of Times

I'm no biblical scholar or even a church goer for that matter, but I vaguely remember something about pestilence, fire, earthquakes, floods and the like as milestones along the way to the Apocalypse, the Rapture, TEOTWAWKI or, at the very least, when TSHTF.

Bird Flu has been identified in Kentucky over the last few days and there is increased risk of West Nile virus in stagnant swimming pools of foreclosed homes; still, 500,000 plastic coffins seem like a lot. They killed the birds and all you need is some DEET for the WNV. Lately, volcanoes all over the place have been a'rupting and a'spewing; earthquakes just missed the Vatican, or were in the same country at least; floods -- lots of floods; and all manner of other natural disasters including no sun spots for what seems like forever. Interpretation of these phenomena rests on the same logic as "it's a recession if you have a job; if you've lost your job, it's a depression." If you lived in New Orleans, Indonesia, are Italian, or haven't cleaned your pool lately, it's the end of times. Especially if you are now dead.*

The Chipping of America

Perhaps you've chipped your pets, farm animals, kids and are using one to plug the hole in your head. New cars are being equipped with GPS chips and old cars will be retrofitted with them; they've been in trucks for some time to track and tax road usage. Chips are all the better to see you with, to trace you with and, ultimately, some think, to tax you with.

Chips are already in homes in California. They are implanted in thermostats to regulate energy use and cannot be overridden by the homeowner. Obama wants to expand this program across the country. Too hot? Too cold? Too bad.

What's Left

McCain showed us his, but Obama has not. Is our president a foreigner, a Muslim or Muslim sympathizer and about to offer up the US to the NWO? And why did he perform the kowtow for the king of Saudi Arabia? Should we be scared, really scared?

Last, but not least, there're the UFOs, the conspiracy theory that keeps giving. Believers must be thinking, what, the **** probes weren't enough; what's an extra-terrestrial got to do to get some respect? Well, if the Grand Archdruid is sceptical of 95% of the evidence, and he is, then I will cling to the 5% chance that the spaceship is coming.

*OT: According to the FBI, 9% of subprime mortgagees were dead when the mortgage was made. I'm wondering: at what point in the process were they dead and when did they know they were dead. Like so much else these days, we may never know.

Marygwen Dungan

 

PPS btw …and what happened to the bush bashing peace activists… were they abducted?

http://www.cnsnews.com/public/content/article.aspx?RsrcID=46413

Edited April 10, 2009 by zdo

[olie1018 10]

that's a lot of speculation, theory, and hearsay... focus on the real facts... facts help the mind make intelligent and accurate decisions...

 

jim