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Pimco Paid Billionaire Gross $290 Million Bonus In 2013

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http://www.zerohedge.com/news/2014-11-14/pimco-paid-gross-el-erian-over-half-billion-dollars-2013-bonuses

Pacific Investment Management Co. paid its former Chief Investment Officer Bill Gross a bonus of about $290 million in 2013, a year in which his Total Return Fund (PTTRX) trailed a majority of peers, according to documents provided to Bloomberg View by someone with knowledge of Pimco’s bonus policies.

Mohamed El-Erian, 56, the former chief executive officer who previously shared the title of CIO with Gross, received a 2013 bonus of about $230 million, according to figures first reported today by Bloomberg View columnist Barry Ritholtz.

By comparison, Laurence D. Fink, CEO of BlackRock Inc., the world’s biggest money manager, received $22.9 million in 2013 compensation, and Michael Diekmann, CEO of Pimco’s parent Allianz SE (ALV), was paid 7.2 million euros ($8.99 million), regulatory filings show.

Well you have to pay the talent. An amazing salary for skimming off the top.

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Well as there appears to have been zero taxpayer's bailout associated with these bond funds, then it's all private money. No fraud, no racketeering. Nothing but decent investment until the last few years of sub-par.

So the best of luck to him and Mo El-A.

And IIRC wasn't W.H.G one of the founders of Pimco?

FWIW, I think the guy is worth the pay packet.

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That is exactly why the City is made of marble. It is a % take on essentially on an increase of the money supply by the Bank of England/Fed etc. that makes people think the charge is worthwhile.

What is even worse is that it is $1.5bn for the top 60 managers!!!!!

Hmm. You're conflating this particular investment with the catch all of 'the Citeh'. And I suspect you do know better.

Every fund manager charges fees for their services.

If his fund had previously made billions over a period and he sliced 10% : then why shouldn't he ? This is straightforward investment and nothing to do with bansksterism.

And BTW do you have any evidence that the Fed has had any input or interference with Pimco at all - since this is a stateside corporation.?

Edited by ZeroSumGame

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ZeroSumGame, on 14 Nov 2014 - 10:53 PM, said:

Well as there appears to have been zero taxpayer's bailout associated with these bond funds, then it's all private money. No fraud, no racketeering. Nothing but decent investment until the last few years of sub-par.

So the best of luck to him and Mo El-A.

And IIRC wasn't W.H.G one of the founders of Pimco?

FWIW, I think the guy is worth the pay packet.

You mean those big creditor bailouts, of which Pimco is one of the largest. Of the GSE's, government debt, bank debt of which Pimco was/is one of the world's largest holders and lobbied furiously for. With asset purchases, higher prices, subsidised refinancing, lower yields. All private money and decent investments with no public backing at all.

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You mean those big creditor bailouts, of which Pimco is one of the largest.

So please supply some links to your evidence that Pimco actually received taxpayers' funds. Or indeed FED collateral.

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At least with so few individuals creaming off these insane amounts in pay and bonuses, rather than it being shared more widely (as I would prefer), is probably strengthens the overall deflationary impulse.

Hotairmail; was it you who posted up a YouTube video of a former investment banker, saying there is no future in investment banking? How it's with hedge funds, and even there, when you invest, you need one which has terms the main traders will reinvest something like 50% of their previous years bonus back into the fund, to help ensure the same traders will take performance very seriously in all years to come?

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ZeroSumGame, on 15 Nov 2014 - 12:18 AM, said:

So please supply some links to your evidence that Pimco actually received taxpayers' funds. Or indeed FED collateral.

What part of creditors and bailout do you not understand? But if that's a serious question then try googling Pimco and GSEs/bank debt/Tarp/Geithner/bailout, or look up Pimco's holdings over time then try a bond pricing formula. I'll start you off:

"In my opinion, the private credit markets have forfeited their privileged right to operate relatively autonomously because of incompetence, excessive greed, and in minor instances, fraudulent activities. As a result, the deflating private market’s balance sheet is being re-nationalized in some cases with increased regulation, in others with outright guarantees and agency lending. Ultimately government programs which support private credit market assets may be required in order to prevent an asset deflation of significant proportions. Authorities must act quickly, with a shot of adrenalin straight to the heart of the problem: home prices."

Bill Gross, concerned mortgage debt holder, 2008.

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What part of creditors and bailout do you not understand? But if that's a serious question then try googling Pimco and GSEs/bank debt/Tarp/Geithner/bailout, or look up Pimco's holdings over time then try a bond pricing formula. I'll start you off:

"In my opinion, the private credit markets have forfeited their privileged right to operate relatively autonomously because of incompetence, excessive greed, and in minor instances, fraudulent activities. As a result, the deflating private market’s balance sheet is being re-nationalized in some cases with increased regulation, in others with outright guarantees and agency lending. Ultimately government programs which support private credit market assets may be required in order to prevent an asset deflation of significant proportions. Authorities must act quickly, with a shot of adrenalin straight to the heart of the problem: home prices."

Bill Gross, concerned mortgage debt holder, 2008.

Again : please supply some links with evidence that Pimco received taxpayer or FED funds.

You've quoted someone's opinion.

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If my memory serves me correctly, he was directly lobbying/threatening of dire consequences for a bailout.

Yes HAMy your memory does serve you correctly. Grossy did indeed talk his book. As does every investment manager since time immemorial.

Why the antipathy to successful fund managers?

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I can't find a way to blame Pimco for being on the receiving end of a Fed bailout.

In fact, if the government gave my company access to almost unlimited interest free debt and offered to buy some stuff that I was otherwise going to throw in the skip for top retail prices, then I would probably have the company pay me a bonus!

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pipllman, on 15 Nov 2014 - 09:14 AM, said:

I can't find a way to blame Pimco for being on the receiving end of a Fed bailout...

I don't necessarily blame them either. My point was they received massive taxpayer funds (bailout) via Governments making GSE and bank debt holders whole, thereby keeping their business from going to the wall; not even whether they should have or how they went about it.

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Isn't it a bit like all the QE money going into the hands of the first receivers who put it into assets like property bumping up the value. Likely quite a lot would go into funds with them being pretty certain that all values would float. Back in the 80s share price boom one trader was reported as saying (and likely it's been oft repeated in recent years either on the record or off the record) "a chimp could make money in this market" - and if you're first in line for the handouts it's a variant on that and those running the funds taking their sometimes massive cut.

(no offence intended to chimps)

Edited by billybong

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Hmm. You're conflating this particular investment with the catch all of 'the Citeh'. And I suspect you do know better.

Every fund manager charges fees for their services.

If his fund had previously made billions over a period and he sliced 10% : then why shouldn't he ? This is straightforward investment and nothing to do with bansksterism.

And BTW do you have any evidence that the Fed has had any input or interference with Pimco at all - since this is a stateside corporation.?

Someone has to be the biggest bond fund.

It happens to be PIMCO and thus it happens to be Gross.

It could be anyone.

If PIMCO had gone bust 20 years ago you'd never have heard of Bill Gross, he (probably) wouldnt be a billionaire and this article would be about someone else.

Edited by R K

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Isn't it a bit like all the QE money going into the hands of the first receivers who put it into assets like property bumping up the value. Likely quite a lot would go into funds with them being pretty certain that all values would float. Back in the 80s share price boom one trader was reported as saying (and likely it's been oft repeated in recent years either on the record or off the record) "a chimp could make money in this market" - and if you're first in line for the handouts it's a variant on that and those running the funds taking their sometimes massive cut.

(no offence intended to chimps)

Exactly.QE, ZIRP and bank bailouts did this.

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