Tell-Tale Signs Wall Street Spending is Back
BOSTON (TheStreet) -- Back in October, a party thrown by a top Goldman Sachs (GS) investment analyst included the performer Lil' Kim dressed in a black cat costume. A few weeks later, a since-fired Morgan Stanley (MS) trader drew gossipy fire when he hired a dwarf to be handcuffed to the guest of honor at a bachelor party.
Those two events may not rise to the scandalous level of excesses seen in the 1980s. That they drew considerable media scrutiny, however, reveals two things: that the general public is still ready to pounce at any display of post-bailout lavishness by Wall Street executives; and, those feelings notwithstanding, those executives are growing tired of not flaunting their wealth.
According to an annual compensation report by Johnson Associates, a New York-based compensation consulting firm, most Wall Street professionals were in line to get at least a 15% bonus based on their salary. Fixed-income and equities traders at investment and commercial banks will be in the 20% range (dropping from 40% last year) due to a midyear slowdown.
Even if bonuses aren't as high as last year, there is still plenty of money being doled out. Bonuses at publicly traded banks, for example, averaged about $141,000 per employee, totaling more than $135 billion.The next few weeks -- as all those recently received bonus checks are put to work -- may reveal to what degree recession-fueled frugality (such as it is for high earners) is giving way and keeping money on the sidelines for the sake of appearances becoming less important than that flashy new car, $100 steak or vintage wine. The following are some indicators Wall Street spending is ready to roar back:
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