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This Bonus Season On Wall Street, Many See Zeros

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http://www.nytimes.com/2010/12/20/business/20bonus.html?_r=1&ref=business

Bonus season is fast approaching on Wall Street, but this year the talk does not center just on multimillion-dollar paydays. It’s about a new club that no one wants to join: the Zeros.

Drawn from a broad swath of back-office employees and middle-level traders, bankers and brokers, the Zeros, as they have come to be called, are facing a once-unthinkable prospect: an annual bonus of ... nothing.

“It’s going to a cause a lot of panic on Wall Street,” said Richard Stein of Global Sage, an executive search firm. “Everybody is talking about it, but they’re actually concerned about it becoming public. I would not want to be head of compensation at a Wall Street firm right now.”

In some ways, a zero bonus should not come as a surprise to many bankers. As a result of the 2008 financial crisis, Wall Street firms like Goldman Sachs and banks like Citigroup raised base pay substantially in 2009 and 2010. They were seeking to placate regulators who had argued that bonuses based on performance encouraged excessive risk.

At Goldman, for instance, the base salary for managing directors rose to $500,000 from $300,000, while at Morgan Stanley and Credit Suisse it jumped to $400,000 from $200,000.

Even though employees will receive roughly the same amount of money, the psychological blow of not getting a bonus is substantial, especially in a Wall Street culture that has long equated success and prestige with bonus size. So there are sure to be plenty of long faces on employees across the financial sector who have come to expect a bonus on top of their base pay. Wall Streeters typically find out what their bonuses will be in January, with the payout coming in February.

One executive, whose firm prohibited discussing the topic with the news media, said the bump in base salaries had confused people, even though their overall compensation was the same. “People expect a big bonus,” this person said. “It is as if they don’t even see their base doubled last year.”

Dealing with the Zeros can be complicated. “It’s a real headache,” said another senior banker, who asked not to be identified because the topic is so volatile at his company. There has been so much grousing that in some cases, he said, “we’ll throw $20,000 or $25,000 at each of the Zeros so they’re not discouraged.”

“No matter what we pay people, it is never enough and they always find something to complain about,” this banker said.

While Zeros are turning up in the ranks of back-office employees and midtier bankers and traders who typically earn $250,000 to $500,000, their bosses way up the compensation ladder are still expected to notch handsome paydays in the millions.

Wow how will these people cope, pay doubled and a bonus of nothing, but hey you might just get lucky and get a $25k pay rise thrown at you just so diddums doesn't get discouraged or upset.

Meanwhile on main street the average joe gets to slave away on a temporary contract and lower pay, whilst footing the bill for the financial sector collapsing. It's tough at the bottom but at least you won't be a zero.

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http://www.nytimes.c...=1&ref=business

Wow how will these people cope, pay doubled and a bonus of nothing, but hey you might just get lucky and get a $25k pay rise thrown at you just so diddums doesn't get discouraged or upset.

Meanwhile on main street the average joe gets to slave away on a temporary contract and lower pay, whilst footing the bill for the financial sector collapsing. It's tough at the bottom but at least you won't be a zero.

Much of it was hush money to keep them quiet whilst the massive City pass the parcel on loan scams were in covert operation.

Now it comes from skimming your Pension, borrowing and Investments thru much higher 'transaction' charges and fEEs they whacked up as soon as the downturn hit!

Edited by erranta

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Much of it was hush money to keep them quiet whilst the massive City pass the parcel on loan scams were in covert operation.

Now it comes from skimming your Pension, borrowing and Investments thru much higher 'transaction' charges and fEEs they whacked up as soon as the downturn hit!

should that not be "MaSSive"?

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  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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