Financial institutions using TARP bailout money to pay executive bonuses <--This is REALLY going to piss off the taxpayer and come back to haunt Wall Street. If they do this it will be them vs. Uncle Sam for the next 4 years. Don't do it guys....If you need to come to the government for a handout, shouldn't your executives forgo a bonus as they are doing in Europe?
The Fed refusing to reveal who received almost $2 trillion in non-TARP loans, or what collateral it has accepted from "emergency" loans made to struggling firms, as Bloomberg reports.
The Treasury Department providing a tax break to banks involved in acquisitions that could amount to $140 billion. <--I, for one, don't have that much of an issue with this one. The reality is it will re-build balance sheets for banks and hopefully keep interest rates low as they won't have to charge crazy rates to generate decent EPS. There are two sides to every story here....
Many people feel, and I have to agree with them on this, that many investment banks generated profits by SIGNIFICANTLY overleveraging themselves and using their capital like a casino. They rolled CRAPS and now the taxpayer has to pay bonuses?
The average American would say "would these guys get the bonuses if not for the U.S. taxpayer? HELL NO!"
I get that these guys work crazy hours, are brilliant people, etc. But part of bonuses is to RETAIN people and to help them walk across the street to the competitor offering even STUPIDER bonuses. Guess what? There are a TON fewer people even around this year, let alone paying bonuses at all!
The taxpayer is going to get VERY pissed VERY quickly if big bonuses come out. I'll even be bold enough to say that some may ask the LEFT LEANING congress, soon to be under Obama's watch, to seriously look at revoking Goldman Sach and Morgan Stanley's bank charter status. Are they really banks? How long can they survive without being able to borrow billions from the federal government for nothing and use it to gamble each day with the taxpayer's money? Now, I would ask Wall Street. Do you really want to piss off the general public and a left leaning congress right now? Your thoughts? Please comment.
35 Year old SWM. I have 3 years of investment banking experience and 7 years of performance management improvement experience (financial analysis). I've worked for 2 Fortune 100 companies and another Fortune 500 company over the years. I've also worked for 2 medium sized businesses.
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