This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Goldman Bonuses: Collateral Damage

NEW YORK ( TheStreet) -- Goldman Sachs' (GS - Get Report) executives deserve big bonuses, but those at most other banks do not.

That looks to be the message from Lloyd Blankfein, CEO of the mighty vampire squid, judging from comments he made at a banking conference in Frankfurt.

According to a Bloomberg report, Blankfein said multi-year contracts should be banned, and "clawbacks" should be instituted to stop executives from taking outsized risks with shareholder capital. No more setting the house on fire and walking away with the loot, in other words.

This is good news for shareholders everywhere, and it won't make much difference to Goldman, which doesn't often make mistakes. Paying its executives heavily in stock, as Blankfein proposes, ought to work out fine for them, as Goldman's stock pretty much only goes up anyway.

It is less good news for executives at Goldman competitors like Morgan Stanley (MS - Get Report) and JPMorgan Chase (JPM - Get Report), and especially ones like American International Group (AIG - Get Report) and Citigroup (C - Get Report), who have a record of screwing up and are owned largely by taxpayers.

The same can be said for the few legacy Merrill Lynch bankers still at Bank of America (BAC - Get Report). BofA is in trouble with New York Attorney general Andrew Cuomo, in part for failing to tell shareholders about bonuses paid to the Merrill bankers.

What a selfish guy, that Blankfein, suggesting bankers should actually have to make money for the companies they work for, rather than just for having fancy resumes! Is this the end of capitalism as we know it? Doubtful, but let's hope so.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
AIG $58.61 0.00%
BAC $16.50 0.00%
C $54.08 0.00%
GS $206.19 0.00%
JPM $65.78 0.00%

Markets

DOW 18,010.68 -115.44 -0.64%
S&P 500 2,107.39 -13.40 -0.63%
NASDAQ 5,070.0260 -27.95 -0.55%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs