AIG bonus mess

NEW -> Contingent Buyer Assistance Program
Must be nice... companies that don't get bailouts are laying off people left and right... those that do get 'em... give out bonuses (and I'm sure they'll claim that the bonuses weren't bailout money... yet they don't know exactly where the bailout money is being spent).



Note to self: Next job should be for a bailout recipient.
 
I think Suicide is a great idea. These few employees in the Financial services unit made a ton of money and took AIG and sent it to the toilet. Its like going to the track and picking losers and then getting a bonus.

Where can I get this job ?



Our conservative friends that whine about welfare for the poor or state paid abortions

need to convince us that its "Good Business" to give these guys ther bonus money.



I say let them sue. They deserve NOTHING. They failed the clients, the company, and themselves.

Kind of like feeling sorry for Daniel Sadek dont you think.



Thats it. We need to bail out Daniel Sadek too.



<img src="http://a332.g.akamai.net/f/332/936/12h/www.edmunds.com//media/il/features/personalities/daniel.sadek.qa/redline.1.500.jpg" alt="" />
 
<a href="http://'http://www.nytimes.com/2009/03/17/business/17sorkin.html?no_interstitial'">The Case for Paying Out Bonuses at A.I.G.</a> From the NY Times
 
I wasn't too upset about this yesterday as I figured well thats probably spread among thousands of employees so really the bonus per person is probably not that much.



However, I was just shown this:



<a href="http://www.huffingtonpost.com/2009/03/17/cuomo-reveals-details-of_n_175865.html">http://www.huffingtonpost.com/2009/03/17/cuomo-reveals-details-of_n_175865.html</a>





<blockquote>? The top recipient received more than $6.4 million;

? The top seven bonus recipients received more than $4 million each;

? The top ten bonus recipients received a combined $42 million;

? 22 individuals received bonuses of $2 million or more, and combined they

received more than $72 million;

? 73 individuals received bonuses of $1 million or more; and

? Eleven of the individuals who received "retention" bonuses of $1 million

or more are no longer working at AIG, including one who received $4.6

million;



Again, these payments were all made to individuals in the subsidiary whose performance

led to crushing losses and the near failure of AIG. Thus, last week, AIG made more than 73

millionaires in the unit which lost so much money that it brought the firm to its knees, forcing taxpayer bailout. Something is deeply wrong with this outcome. I hope the Committee will

address it head on.



We have also now obtained the contracts under which AIG decided to make these

payments. The contracts shockingly contain a provision that required most individuals' bonuses to be 100% of their 2007 bonuses. Thus, in the Spring of last year, AIG chose to lock in bonuses for 2008 at 2007 levels despite obvious signs that 2008 performance would be disastrous in comparison to the year before. My Office has thus begun to closely examine the circumstances under which the plan was created.

</blockquote>
 
The issue of the bonuses is a huge sideshow.



The real issue is the funneling of money through AIG to Goldman Sachs, Deutsche Bank and Societe Generale.



<a href="http://dealbook.blogs.nytimes.com/2009/03/15/aig-discloses-counterparties-who-received-224-billion/?hp">http://dealbook.blogs.nytimes.com/2009/03/15/aig-discloses-counterparties-who-received-224-billion/?hp</a>
 
Looks like the rats are leaving the sinking ship after they got the cheese.



11 of the 73 got the cash and have quit AIG.

So much for the "Retention" lie.



<a href="http://www.cnn.com/2009/POLITICS/03/17/aig.bonuses/index.html">http://www.cnn.com/2009/POLITICS/03/17/aig.bonuses/index.html</a>



I am liking that 100% tax. Sounds good. We should have done that to Mozilo.
 
[quote author="ukyo116" date=1237361673]If you need someone to blame, do not blame AIG.



Blame Geithner for letting Lehman Brothers fail.</blockquote>


Actually, you should blame the banking execs who lobbied for decades to get their regulatory oversight removed so they could make small fortunes for themselves, and then were "surpised" when the financial tsunami wrecked their respective companies leaving the taxpayers to recapitalize after they retired gazillionares. And also blame the politicians and govt regulators that were dumb enough to go along with all that. You mean if you remove regulations put in place to prevent the humungeous financial crisis that caused the Great Depression, you can bring about another humungeous financial crisis? Whocoodanoded?



<A href="http://www.pbs.org/wgbh/pages/frontline/shows/wallstreet/weill/demise.html">http://www.pbs.org/wgbh/pages/frontline/shows/wallstreet/weill/demise.html</A>
 
[quote author="ukyo116" date=1237361673]If you need someone to blame, do not blame AIG.



Blame Geithner for letting Lehman Brothers fail.</blockquote>


How about I blame Lehman for Lehman failing. Give me a break. Economic cycles happen and I accept them as a part of life. I do not accept this "too big to fail" BS that I keep hearing. Whats another few hundred or thousand DOW points. These are hard lessons to learn for the finance world, but are we going to keep bailing them out so its a footnote and a 10 year lesson? Or let it sting and let it be a 100 year lesson?



Worst case scenario; a massive loss of wealth, which ultimately evens itself out with deflation and the lesser amounts of money being worth more again, <strong>life goes on. </strong> Property doesnt explode, buildings dont instantly crumble, and temporarily out-of-work individuals dont forget their marketable skills. The underlying assets of the economy arent going anywhere. So quit telling me we're doing this to prevent some apocalypse of disorder from which we may never return. I don't buy it. The people who control the wealth and key positions of influence have everything to gain from you believing that we MUST act to save these companies.



Market is risk. Business is risk. LOOK UP THE DEFINITION OF "RISK." All I see are whiny kids pounding their fists on the table because they "dont like it!!!!". Its supremely unfortunate that these tantrum-throwing individuals have the power to pull the strings to finance their remedy with my tax dollars. How are the dynamic and innovative corporations of tomorrow supposed to emerge when the obsolete dinosaurs of the past are kept around on life support taking up all that space?



And your suggestion that its not AIG's fault is supremely ignorant. Read up on their part in dealing with these "creative market instruments".
 
[quote author="MojoJD" date=1237422828]

How about I blame Lehman for Lehman failing. Give me a break. Economic cycles happen and I accept them as a part of life. I do not accept this "too big to fail" BS that I keep hearing. Whats another few hundred or thousand DOW points. These are hard lessons to learn for the finance world, but are we going to keep bailing them out so its a footnote and a 10 year lesson? Or let it sting and let it be a 100 year lesson?



Worst case scenario; a massive loss of wealth, which ultimately evens itself out with deflation and the lesser amounts of money being worth more again, <strong>life goes on. </strong> Property doesnt explode, buildings dont instantly crumble, and temporarily out-of-work individuals dont forget their marketable skills. The underlying assets of the economy arent going anywhere. So quit telling me we're doing this to prevent some apocalypse of disorder from which we may never return. I don't buy it. The people who control the wealth and key positions of influence have everything to gain from you believing that we MUST act to save these companies.



Market is risk. Business is risk. LOOK UP THE DEFINITION OF "RISK." All I see are whiny kids pounding their fists on the table because they "dont like it!!!!". Its supremely unfortunate that these tantrum-throwing individuals have the power to pull the strings to finance their remedy with my tax dollars. How are the dynamic and innovative corporations of tomorrow supposed to emerge when the obsolete dinosaurs of the past are kept around on life support taking up all that space?



And your suggestion that its not AIG's fault is supremely ignorant. Read up on their part in dealing with these "creative market instruments".</blockquote>


Is my view supremely ignorant now?



Let me make myself clear, I do not like anything that is going on with any of the bailouts. No one should be given a single cent.



Where did I mention that this was to prevent an apocalypse? I am a proponent of the Austrian economic belief that busts must be allowed to run their course with minimal government intervention. It just so happens that I live in a country where this is not happening, so I must go with the flow per say.



My beef with this whole thing is the inconsistency of their actions. Why did Bear Stearns get bailed out, but not Lehman Brothers? Then right after Lehman fails, AIG gets rescued? What kind of policy is that? They are making things up as they go, and I do believe there are some outside forces influencing these actions that we are not being told. I talked with a colleague the other day about AIG, and all she could focus on was AIG execs getting millions. I pointed out to her (in the above link that I provided) that Goldman Sachs was getting billions through AIG from the government. And she sort of shrugged that off and continued in anger about the AIG execs. What am I missing here? Is a billion not 1000 times a million? The whole thing is madness to me.
 
I took your post the wrong way. I just think they should all fail. Also, 90% of my rant is against the popular notion of "saving these guys to help us all out" that's being thrown around a lot lately... not your post. :)
 
This is a good article from back in September.

I posted it in the Politics thread on AIG too.

In simple english it explains what went wrong at AIG back in the fall.

They only played one side of the hedge and got burned.



<a href="http://www.reuters.com/article/newsOne/idUSMAR85972720080918">http://www.reuters.com/article/newsOne/idUSMAR85972720080918</a>



But as I said in that thread. The managers of the AIG Financial Services were responsible

for the big picture. Live by the sword and die by the sword. In this case they need to fall on there swords and be men. Huge bonus money for imploding the company is not appropriate

in any scenario.
 
If you are going to take away bonuses from AIG, then you must go after Goldman Sachs, Merrill Lynch, Societe Generale, Deutsche Bank, and UBS.



<a href="http://www.bloomberg.com/apps/news?pid=20601087&sid=a5V0jKS7y.WI&refer=home">Treasury Preserves Bank Payday With AIG Rescue Cash</a>
 
[quote author="ukyo116" date=1237429101][quote author="MojoJD" date=1237422828]

How about I blame Lehman for Lehman failing. Give me a break. Economic cycles happen and I accept them as a part of life. I do not accept this "too big to fail" BS that I keep hearing. Whats another few hundred or thousand DOW points. These are hard lessons to learn for the finance world, but are we going to keep bailing them out so its a footnote and a 10 year lesson? Or let it sting and let it be a 100 year lesson?



Worst case scenario; a massive loss of wealth, which ultimately evens itself out with deflation and the lesser amounts of money being worth more again, <strong>life goes on. </strong> Property doesnt explode, buildings dont instantly crumble, and temporarily out-of-work individuals dont forget their marketable skills. The underlying assets of the economy arent going anywhere. So quit telling me we're doing this to prevent some apocalypse of disorder from which we may never return. I don't buy it. The people who control the wealth and key positions of influence have everything to gain from you believing that we MUST act to save these companies.



Market is risk. Business is risk. LOOK UP THE DEFINITION OF "RISK." All I see are whiny kids pounding their fists on the table because they "dont like it!!!!". Its supremely unfortunate that these tantrum-throwing individuals have the power to pull the strings to finance their remedy with my tax dollars. How are the dynamic and innovative corporations of tomorrow supposed to emerge when the obsolete dinosaurs of the past are kept around on life support taking up all that space?



And your suggestion that its not AIG's fault is supremely ignorant. Read up on their part in dealing with these "creative market instruments".</blockquote>


Is my view supremely ignorant now?



Let me make myself clear, I do not like anything that is going on with any of the bailouts. No one should be given a single cent.



Where did I mention that this was to prevent an apocalypse? I am a proponent of the Austrian economic belief that busts must be allowed to run their course with minimal government intervention. It just so happens that I live in a country where this is not happening, so I must go with the flow per say.



My beef with this whole thing is the inconsistency of their actions. Why did Bear Stearns get bailed out, but not Lehman Brothers? Then right after Lehman fails, AIG gets rescued? What kind of policy is that? They are making things up as they go, and I do believe there are some outside forces influencing these actions that we are not being told. I talked with a colleague the other day about AIG, and all she could focus on was AIG execs getting millions. I pointed out to her (in the above link that I provided) that Goldman Sachs was getting billions through AIG from the government. And she sort of shrugged that off and continued in anger about the AIG execs. What am I missing here? Is a billion not 1000 times a million? The whole thing is madness to me.</blockquote>
Why did Bear and AIG get a life line and Lehman didn't? Easy, because Goldman didn't have much to lose with Lehman going down.
 
[quote author="usctrojanman29" date=1238024146]





Why did Bear and AIG get a life line and Lehman didn't? Easy, because Goldman didn't have much to lose with Lehman going down.</blockquote>


Because Lehman did not ante up in the Long term Capital Management crisis. The boys just waited until Lehman needed help and cut 'er loose.
 
Dear A.I.G., I Quit!

<A href="http://www.nytimes.com/2009/03/25/opinion/25desantis.html">http://www.nytimes.com/2009/03/25/opinion/25desantis.html</A>
 
[quote author="no_vaseline" date=1237337790]Just nationalize them and force the congressional salary restrictions/caps on them already.</blockquote>




The Road to Serfdom <a href="http://www.google.com/url?sa=t&source=web&ct=res&cd=9&url=http://www.iea.org.uk/files/upld-publication43pdf?.pdf&ei=qinLSbbzHNzMlQeO1dDZCQ&usg=AFQjCNENbPc1YpgYdRjDl3YADRD0gIa8QA&sig2=g01kcLWeTz-PUBQlYGS0aw">[PDF]</a>



<a href="http://en.wikipedia.org/wiki/The_Road_to_Serfdom">See also</a>



<a href="http://en.wikipedia.org/wiki/Socialism">And this</a>



<a href="http://3.bp.blogspot.com/_DmV9AzbuPNQ/SbCtjxM9SmI/AAAAAAAAAkQ/Ul8nqua4c1s/s400/unicorns-rainbow.jpg">One more</a>



<a href="http://failblog.files.wordpress.com/2009/02/fail-owned-kool-aid-fail.jpg">Ok last one seriously</a>
 
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