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UBS bonus shake up.

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The Swiss bank UBS set out a tough new pay system yesterday for its top executives that could see senior bankers "fined" or forced to repay part of their bonuses if they under-perform in years of hefty losses.

 

Proclaiming the end of the era of excessive bonuses in the global financial sector, Peter Kurer, the bank's chairman, who is paid a fixed annual salary of 2m Swiss francs (£1.1m), said the new system would eradicate the culture of paying out multimillion bonuses and stock options on short-term results and rewarding excessive risk-taking.

 

The proposed cultural shift would see rewards for "those who deliver good results over several years without assuming unnecessarily high risk," he added.

 

His comments came as Goldman Sachs, the US bank renowned for its huge Christmas payouts, said its seven top executives would get no bonus for 2008. Top executives at Deutsche Bank, Germany's biggest, have already waived their bonuses."

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His comments came as Goldman Sachs, the US bank renowned for its huge Christmas payouts, said its seven top executives would get no bonus for 2008. Top executives at Deutsche Bank, Germany's biggest, have already waived their bonuses."

 

:jesuswept:

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Guest alex
So long as I get mine :)

 

 

Remember my little comment about capital flows the other day? :jesuswept:

I remember your declining my invitation to explain it :lol:

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They'll have to spend the $700bn on salary hikes rather than bonuses I guess.

 

No money man. :jesuswept:

 

Are you kidding me?

 

Simpson Thacher's first test — the deal to give $125 billion to the nine big banks to ease the "credit crunch" that is crippling the economy — wasn't exactly reassuring. Secretary Paulson promised that the banks won't just "hoard" the money — they will quickly "deploy it" through the economy in the form of badly needed loans. There is just one hitch: Neither Paulson nor Simpson Thacher got that "deploy" part in writing — nor did they put in place any mechanism to require the banks to spend their taxpayer billions. Apparently, the part about lending the money to homeowners and small businesses was sort of implied.

 

"There is no obligation for banks to lend the money one way or the other," Jennifer Zuccarelli, a Treasury spokeswoman, tells Rolling Stone. "But the banks have the understanding" that the money is intended for loans. "We're not looking to control their operations."

 

Unfortunately, many of the banks appear to have no intention of wasting the money on loans. "At least for the next quarter, it's just going to be a cushion," said John Thain, the chief executive of Merrill Lynch. Gary Crittenden, chief financial officer of Citigroup, had an even better idea: He hinted that his company would use its share of the cash — $25 billion — to buy up competitors and swell even bigger. The handout, he told analysts, "does present the possibility of taking advantage of opportunities that might otherwise be closed to us."

 

And the folks at Morgan Stanley? They're planning to pay themselves $10.7 billion this year, much of it in bonuses — almost exactly the amount they are receiving in the first phase of the bailout. "You can imagine the devilish grins on the faces of Morgan Stanley employees," writes Bloomberg columnist Jonathan Weil. "Not only did we, the taxpayers, save their company...we funded their 2008 bonus pool."

 

http://www.toontastic.net/board/index.php?showtopic=21802

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So long as I get mine :)

 

 

Remember my little comment about capital flows the other day? :jesuswept:

I remember your declining my invitation to explain it :lol:

 

Simply what is making the system unstable is that investment capital moves quickly towards opportunities for short term gain at high risk. This process is further destabalised by the bonus structure of said firms.

 

So for instance with the housing speculation in the U.S. the money simply didn't have other good places to go for quick returns and portfolio ballast (silly term I know).

 

 

"All the executive heads of the commissions, in nuanced ways, underscored the non-functioning of the international finance system and the inability of individual countries to cope with systemic problems caused by the nature of the current financial flows, and the herd behaviour of foreign investors, and underlined the need for international actions, particularly to curb short-term capital flows, in both the host and home countries.

 

But two representatives of Wall Street firms, Ms Joyce Cornell of Scudder Kemper Investments, a portfolio fund investor which claimed to be active in Africa, and Goldman Sachs International, a global investment bank which was formerly headed by the present US Treasury Secretary Rubin, spoke with differing nuances but with the basic message that countries should not interfere with flows of capital into and out of a country, but rather take measures to provide confidence to the investors and markets."

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They'll have to spend the $700bn on salary hikes rather than bonuses I guess.

 

No money man. :jesuswept:

 

Are you kidding me?

 

Simpson Thacher's first test — the deal to give $125 billion to the nine big banks to ease the "credit crunch" that is crippling the economy — wasn't exactly reassuring. Secretary Paulson promised that the banks won't just "hoard" the money — they will quickly "deploy it" through the economy in the form of badly needed loans. There is just one hitch: Neither Paulson nor Simpson Thacher got that "deploy" part in writing — nor did they put in place any mechanism to require the banks to spend their taxpayer billions. Apparently, the part about lending the money to homeowners and small businesses was sort of implied.

 

"There is no obligation for banks to lend the money one way or the other," Jennifer Zuccarelli, a Treasury spokeswoman, tells Rolling Stone. "But the banks have the understanding" that the money is intended for loans. "We're not looking to control their operations."

 

Unfortunately, many of the banks appear to have no intention of wasting the money on loans. "At least for the next quarter, it's just going to be a cushion," said John Thain, the chief executive of Merrill Lynch. Gary Crittenden, chief financial officer of Citigroup, had an even better idea: He hinted that his company would use its share of the cash — $25 billion — to buy up competitors and swell even bigger. The handout, he told analysts, "does present the possibility of taking advantage of opportunities that might otherwise be closed to us."

 

And the folks at Morgan Stanley? They're planning to pay themselves $10.7 billion this year, much of it in bonuses — almost exactly the amount they are receiving in the first phase of the bailout. "You can imagine the devilish grins on the faces of Morgan Stanley employees," writes Bloomberg columnist Jonathan Weil. "Not only did we, the taxpayers, save their company...we funded their 2008 bonus pool."

 

http://www.toontastic.net/board/index.php?showtopic=21802

 

 

 

I can't remember but are there options to buy into these firms with public money or am I talking shit?

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They'll have to spend the $700bn on salary hikes rather than bonuses I guess.

 

No money man. :jesuswept:

 

Are you kidding me?

 

Simpson Thacher's first test — the deal to give $125 billion to the nine big banks to ease the "credit crunch" that is crippling the economy — wasn't exactly reassuring. Secretary Paulson promised that the banks won't just "hoard" the money — they will quickly "deploy it" through the economy in the form of badly needed loans. There is just one hitch: Neither Paulson nor Simpson Thacher got that "deploy" part in writing — nor did they put in place any mechanism to require the banks to spend their taxpayer billions. Apparently, the part about lending the money to homeowners and small businesses was sort of implied.

 

"There is no obligation for banks to lend the money one way or the other," Jennifer Zuccarelli, a Treasury spokeswoman, tells Rolling Stone. "But the banks have the understanding" that the money is intended for loans. "We're not looking to control their operations."

 

Unfortunately, many of the banks appear to have no intention of wasting the money on loans. "At least for the next quarter, it's just going to be a cushion," said John Thain, the chief executive of Merrill Lynch. Gary Crittenden, chief financial officer of Citigroup, had an even better idea: He hinted that his company would use its share of the cash — $25 billion — to buy up competitors and swell even bigger. The handout, he told analysts, "does present the possibility of taking advantage of opportunities that might otherwise be closed to us."

 

And the folks at Morgan Stanley? They're planning to pay themselves $10.7 billion this year, much of it in bonuses — almost exactly the amount they are receiving in the first phase of the bailout. "You can imagine the devilish grins on the faces of Morgan Stanley employees," writes Bloomberg columnist Jonathan Weil. "Not only did we, the taxpayers, save their company...we funded their 2008 bonus pool."

 

http://www.toontastic.net/board/index.php?showtopic=21802

 

 

 

I can't remember but are there options to buy into these firms with public money or am I talking shit?

 

That's what Brown has done. The taxpayer will get their money back, as long as the companies don't fold.

 

Paulson has handed the banks the cash and sent out the message to private investors that there are certain companies that the government will not allow the stock to fall on. A risk free investment for the wealthy at the expense of the poor.

Edited by Happy Face

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They'll have to spend the $700bn on salary hikes rather than bonuses I guess.

 

No money man. :lol:

 

Are you kidding me?

 

Simpson Thacher's first test — the deal to give $125 billion to the nine big banks to ease the "credit crunch" that is crippling the economy — wasn't exactly reassuring. Secretary Paulson promised that the banks won't just "hoard" the money — they will quickly "deploy it" through the economy in the form of badly needed loans. There is just one hitch: Neither Paulson nor Simpson Thacher got that "deploy" part in writing — nor did they put in place any mechanism to require the banks to spend their taxpayer billions. Apparently, the part about lending the money to homeowners and small businesses was sort of implied.

 

"There is no obligation for banks to lend the money one way or the other," Jennifer Zuccarelli, a Treasury spokeswoman, tells Rolling Stone. "But the banks have the understanding" that the money is intended for loans. "We're not looking to control their operations."

 

Unfortunately, many of the banks appear to have no intention of wasting the money on loans. "At least for the next quarter, it's just going to be a cushion," said John Thain, the chief executive of Merrill Lynch. Gary Crittenden, chief financial officer of Citigroup, had an even better idea: He hinted that his company would use its share of the cash — $25 billion — to buy up competitors and swell even bigger. The handout, he told analysts, "does present the possibility of taking advantage of opportunities that might otherwise be closed to us."

 

And the folks at Morgan Stanley? They're planning to pay themselves $10.7 billion this year, much of it in bonuses — almost exactly the amount they are receiving in the first phase of the bailout. "You can imagine the devilish grins on the faces of Morgan Stanley employees," writes Bloomberg columnist Jonathan Weil. "Not only did we, the taxpayers, save their company...we funded their 2008 bonus pool."

 

http://www.toontastic.net/board/index.php?showtopic=21802

 

 

 

I can't remember but are there options to buy into these firms with public money or am I talking shit?

 

That's what Brown has done. The taxpayer will get their money back, as long as the companies don't fold.

 

Paulson has handed the banks the cash and sent out the message to private investors that there are certain companies that the government will not allow the stock to fall on. A risk free investment for the wealthy at the expense of the poor.

 

Thanks.

 

Brown is so old skool. :jesuswept:

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Naomi Klein questioned the legality of it last week, and she's expanded on it today...

 

There's a few elements now that are being described as illegal that we're finding out. First of all, the equity deals that were negotiated with the largest banks and also some smaller banks, representing $250 billion worth of the bailout money, this is the deal to inject capital into the banks in exchange for equity. The idea was to address the so-called credit crunch to get banks lending again. The legislation that enabled this was quite explicit that it had to encourage lending. Barney Frank, who was one of the architects of that legislation, has said that it violates the act if the money is not going to that purpose and is instead going to bonuses, is instead going to dividends, going to salaries, going to mergers. He said that violates the acts, i.e. it's illegal. But what we know is that it's going precisely to those purposes. It is going to bonuses. It is going to shareholders. And it is not going to lending. The banks have been quite explicit about this. Citibank has talked about using the money to buy other banks.

 

Then there's other aspects of this that are borderline illegal. We found out that in the midst of the crisis, the Bush Treasury Department pushed through a tax windfall for the banks, a piece of legislation that allows the banks to save a huge amount of money when they merge with each other. And the estimate is that this represents a loss of $140 billion worth of tax revenue for the US government. Many tax attorneys who were interviewed by the Washington Post said that they felt that the way in which the Treasury Department went about this by unilaterally changing the tax code was illegal, that this had to include Congress. Congress only found out about it after the fact.

 

There's another piece of this puzzle that is also borderline illegal, which is that in addition to the $700 billion that we are discussing, the $700 billion bailout, there's another $2 trillion that's been handed out by the Federal Reserve in emergency loans to financial institutions, to banks, that actually we don't really know who they're handing the money out to, because, apparently, it's a secret. They could be handing it out to a range of other corporations -- I think they are -- but they're saying that they won't disclose who has received these taxpayer loans, because it could cause a run on the banks, it could cause the market to lose confidence in the institutions that have taken these loans. Once again, that represents an additional $2 trillion.

 

:jesuswept:

 

The other thing that the Fed won't disclose is what they have accepted as collateral in exchange for these loans. This is a really key point, because, of course, at the heart of the financial crisis is -- are these so- called distressed assets. The value of these assets is enormously controversial. They may be worth very little. So if the Fed has accepted distressed assets as collateral in exchange for these loans, there's a very good chance the taxpayers aren't going to be getting this money back. So Bloomberg News has launched a lawsuit in federal court to find out who has received the loans and what has been accepted as collateral, because they believe that this lack of transparency is illegal. So that's why we're calling this the "trillion-dollar crime scene" or the "multi-trillion-dollar crime scene." And they're really challenging lawmakers to call them out, the Treasury is.

 

Henry Paulson's original three-page proposal, the $700 billion stickup, where he basically said, "Give me $700 billion. Don't ask any questions. I can never be challenged by any arm of government or any court of law." Now, that aspect of the bailout was supposedly dealt with, and we were all reassured that there was going to be transparency, accountability, legality. But now we're finding out that, in fact, Henry Paulson has achieved his original goal by stealth, because there is no accountability, and lawmakers are very hesitant to challenge this, because they're afraid of causing a run on the banks, of causing more market instability. So, essentially, what the Bush administration has done is said, you know, "We dare you to challenge us and be responsible for the great depression." And the Democrats, not known for their firm spines, have so far failed to challenge them in anything other than rhetoric.

 

The full interview is here...

 

http://www.alternet.org/workplace/107458/n...bailout/?page=1

Edited by Happy Face

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I'll have a good read of that later. Thanks.

 

On first impressions it looks like the criminality of the super rich continues unabated. :jesuswept:

 

I'm fascinated by it all. Can't read enough.

 

She highlights the difference between the US and UK packages in more detail than I had...

 

Gordon Brown got voting rights at the banks that they bailed out, seats on the boards, 12 percent dividends for UK taxpayers, as opposed to the five percent negotiated in the US and no voting rights and no seats on the board. Other thing Gordon Brown did is he got it in writing that the banks had to start lending, as opposed to Henry Paulson, who didn't get it in writing, and the banks are not lending.

 

America would rather go bust than allow a hint of socialism into the system.

 

Where we've nationalised the banks, the US has privatised the treasury.

 

That 2 trillion quote above, isn't the whole story either. CNBC have totalled the bailout bill at $4,284,500,000,000, that's $4.28 trillion.

 

http://www.cnbc.com/id/27719011/

 

"More than what was spent on WW II, if adjusted for inflation"

 

And still, the anti-bailout marches go unreported by the mainstream media.

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I'll have a good read of that later. Thanks.

 

On first impressions it looks like the criminality of the super rich continues unabated. :)

 

I'm fascinated by it all. Can't read enough.

 

She highlights the difference between the US and UK packages in more detail than I had...

 

Gordon Brown got voting rights at the banks that they bailed out, seats on the boards, 12 percent dividends for UK taxpayers, as opposed to the five percent negotiated in the US and no voting rights and no seats on the board. Other thing Gordon Brown did is he got it in writing that the banks had to start lending, as opposed to Henry Paulson, who didn't get it in writing, and the banks are not lending.

 

America would rather go bust than allow a hint of socialism into the system.

 

Where we've nationalised the banks, the US has privatised the treasury.

 

That 2 trillion quote above, isn't the whole story either. CNBC have totalled the bailout bill at $4,284,500,000,000, that's $4.28 trillion.

 

http://www.cnbc.com/id/27719011/

 

"More than what was spent on WW II, if adjusted for inflation"

 

And still, the anti-bailout marches go unreported by the mainstream media.

 

 

Makes one wonder donnit? :lol:

 

 

Quite tempted to start my Parky's top 50 people who run things and no one has ever heard of much thread. :jesuswept:

Edited by Park Life

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I'll have a good read of that later. Thanks.

 

On first impressions it looks like the criminality of the super rich continues unabated. :jesuswept:

 

I'm fascinated by it all. Can't read enough.

 

She highlights the difference between the US and UK packages in more detail than I had...

 

Gordon Brown got voting rights at the banks that they bailed out, seats on the boards, 12 percent dividends for UK taxpayers, as opposed to the five percent negotiated in the US and no voting rights and no seats on the board. Other thing Gordon Brown did is he got it in writing that the banks had to start lending, as opposed to Henry Paulson, who didn't get it in writing, and the banks are not lending.

 

America would rather go bust than allow a hint of socialism into the system.

 

Where we've nationalised the banks, the US has privatised the treasury.

 

That 2 trillion quote above, isn't the whole story either. CNBC have totalled the bailout bill at $4,284,500,000,000, that's $4.28 trillion.

 

http://www.cnbc.com/id/27719011/

 

"More than what was spent on WW II, if adjusted for inflation"

 

And still, the anti-bailout marches go unreported by the mainstream media.

 

 

Lot of the aggro started when the Fed didn't have to declare (as they used to have to) how much currency they were printing/circulating.

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I wonder what the cost would be if the banking system collapsed without it.

 

(In financial and non financial terms)

 

I dont fancy a return to Victorian London Ta.

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I wonder what the cost would be if the banking system collapsed without it.

 

(In financial and non financial terms)

 

I dont fancy a return to Victorian London Ta.

 

It collapsed in 1979 mate. :jesuswept:

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I'll have a good read of that later. Thanks.

 

On first impressions it looks like the criminality of the super rich continues unabated. :scratchchin:

 

I'm fascinated by it all. Can't read enough.

 

She highlights the difference between the US and UK packages in more detail than I had...

 

Gordon Brown got voting rights at the banks that they bailed out, seats on the boards, 12 percent dividends for UK taxpayers, as opposed to the five percent negotiated in the US and no voting rights and no seats on the board. Other thing Gordon Brown did is he got it in writing that the banks had to start lending, as opposed to Henry Paulson, who didn't get it in writing, and the banks are not lending.

 

America would rather go bust than allow a hint of socialism into the system.

 

Where we've nationalised the banks, the US has privatised the treasury.

 

That 2 trillion quote above, isn't the whole story either. CNBC have totalled the bailout bill at $4,284,500,000,000, that's $4.28 trillion.

 

http://www.cnbc.com/id/27719011/

 

"More than what was spent on WW II, if adjusted for inflation"

 

And still, the anti-bailout marches go unreported by the mainstream media.

 

 

Makes one wonder donnit? :lol:

 

 

Quite tempted to start my Parky's top 50 people who run things and no one has ever heard of much thread. :jesuswept:

 

That's the kind of action we need to make people stand up and take notice. :)

 

And if you haven't already, you should click on the slideshow at that CNBC link. Shows how, adjusted for inflation, nothing America has ever done before has cost them this much...

 

 

Hoover Dam - $782 Million

Panama Canal - $7.9 Billion

Gulf War 1 - $98 Billion

Marshall Plan - $115 Billion (Rebuilt the economies of every European nation involved in the war bar Germany back to pre-war levels in just 6 years)

Louisiana Purchase - £217 Billion

Race to the Moon - £237 Billion

Savings & Loan Crisis - $256 Billion

Korean War - $454 Billion

The New Deal - $500 Billion

Gulf War II / War on Terror - $597 Billion

Vietnam War - $698 Billion

NASA (Cumulative) - $851 Billion (over 50 years worth of funding)

World War II - $3.6 Trillion

 

Bailout '08 - $4.28 Trillion

 

It's a huge sum - being handed over to private companies and shareholders.

 

Just one last wooly liberal point...

 

Basic health and nutrition for everyone on the planet would cost another $13 Billion.

 

http://www.globalissues.org/article/26/pov...facts-and-stats

 

:(

Edited by Happy Face

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I had no idea it was that high. :jesuswept:

 

 

This sets some interesting precedents.

 

 

**Get back to this a bit later.

Edited by Park Life

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"The super bubble....Over 25 years....Constant credit expansion using greater and greater leverage (gearing)..." Soros.

 

 

 

 

Edited by Park Life

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