Lloyd Blankfein Took Home $125 Million In Bonuses In Last 10 Years, But Shareholders Haven't Been So Lucky

Lloyd Blankfein, CEO of Goldman Sachs, took home $125 million in cash bonuses over the past decade, Bloomberg reports.

Shareholders, however, haven't been quite so lucky.

Even though Goldman has outperformed its peers over Blankfein's tenure, Bloomberg points out that one-year certificates of deposit and 10-year Treasury bonds purchased in September 2000 beat Goldman's total return over the same period. The logic behind lavish CEO pay depends on maximizing returns for shareholders, but Bloomberg notes that the S&P 500 Financials Index, which includes 80 companies, has dropped 49 percent in the past ten years.

Blankfein, who paid $26 million in 2008 for a condo in the Robert Stern-designed 15 Central Park West building in Manhattan, and who last month sold his previous apartment at 941 Park Avenue for $12.15 million, has overseen a period of relative strength since becoming CEO in June 2006.

Even as the financial world nearly collapsed around it, Goldman has remained strong, or gotten even grown stronger. When Goldman settled with the S.E.C. for $550 million in July, the perception was that the bank and its CEO, who joined the company back in 1981 when it bought his then-employer J. Aron, had gotten off easy.

Transparency regarding bonuses has been limited. This summer, the financial community braced for embarrassment in anticipation of a report by U.S. pay czar Kenneth Feinberg disclosing the total bonuses Wall Street paid during the beginning of the bailout (from the passage of the Troubled Asset Relief Program in October 2008 until February 2009, when oversight laws were passed), the Wall Street Journal said. But when the report actually came out in July, Feinberg didn't say how much of the total $1.6 billion the 17 firms in question actually got, and declined to cite specific examples of excessive compensation.

He said, according to the WSJ, that the payments "were ill advised, they were troublesome. But I do not believe it is fair to declare ... that the payments were 'contrary to the public interest.'"

Comments

[termo123]

04:48 PM on 09/28/2010

Yeah, but most of that was for playing Mini Me in the Austin Powers movies

[BigDaddyWow]

09:48 PM on 09/25/2010

And here is the bad news... Blankfein wasn't close to being one of the top earners.

[senorlou]

09:04 AM on 09/23/2010

And certain people want to get our Social Security money into their hands.  

[tribilin219]

06:54 PM on 09/22/2010

These Wall St bums should be in jail and not in congress telling those crook's Lie's !

[senorlou]

09:05 AM on 09/23/2010

I agree, they should be in jail - a lot of them.  What they do for a "living" should be made illegal.  Wall Street needs serious reforms.

[joungredding]

02:07 PM on 09/22/2010

http://www.huffingtonpost.com/robert-rosenthal/facing-life_b_730966.html

[JoeBlough]

02:03 PM on 09/22/2010

Share holders are the pawns that protect the kings and queens.

[tuberider]

12:53 PM on 09/22/2010

...and the shareholders' karmic value has been, perhaps eternally, damaged.

[steve11407]

11:47 AM on 09/22/2010

Surprise, surprise.

[sueinmn]

08:49 AM on 09/22/2010

Share holders are today being treated somewhat like employees, having little say and realizing cuts in order for the CEO to maintain his bloated bonus and packages.

[wecanonlyhope]

08:03 AM on 09/22/2010

I fail to understand why this should be news. When the top brass take home inordinate bonuses instead of rewarding shareholders with larger dividends and adding to the firm's capital base the return to shareholders diminishes over time. DUH.

[tacevad]

07:45 AM on 09/22/2010

There is no longer any logic behind lavish CEO pay

[48thGuy]

07:34 AM on 09/22/2010

I just love good ol' corpspeak!...'We do everything with shareholder value in mind'...

[andycan]

04:44 AM on 09/22/2010

Give him 125 years in jail, what the heck!

[Jackal Jackal]

11:49 PM on 09/21/2010

THE PROBLEM BLANKFEIN IS THAT HE AND THE REST OF THE INVESTMENT BANKERS AND NORMAL BANKERS IS THAT SINCE THEY ARE THE MARKET MAKERS.....THEY CREATE CDOS AND OTHER COMPLEX FINANCIAL PRODUCTS, THAT THEY SELL TO INVESTORS, THEY ONLY GIVE HALF OF THE INFORMATION TO THE INVESTORS, THEN BET AGAINST WHAT THEY HAVE SOLD. SO, IN ANOTHER WORDS, THEY MAKE MONEY 2 WAYS. THEY BET AGAINST THE PRODUCTS THEY SOLD, THEN THEY MAKE MONEY FROM THE INVESTORS THAT GOT THE SHAFT.
COLLATROIZED DEBT OBLIGATIONS ARE A SET OF SECURITIES THAT BANKS BUY IN BULK THEN CREATE A PACKAGE WHERE CONTINUAL DEBT FROM HOUSING AND CREDIT CARDS AND THE LIKE, KEEP FEEDING THESE BANKERS. AS LONG AS THE DEBTS ARE NOT BEING PAID FOR, THESE BANKERS MAKE MONEY OFF THE INTEREST RATE AND SO FORTH.
EVERY BANKER WAS DOING IT. ACTUALLY THEY ARE NOT BANKERS, THEY ARE TRADERS. BLANKFEIN TOOK OVER THE TOP JOB FROM A BANKER.
BLANKFEINS OF THIS WORLD, WILL TRADE AND TRADE EVEN AS THE ECONOMY TANKS.....WHICH IS WHAT THEY WERE DOING AT THE END OF LAST QUARTER.
THE GOVT IS NOW LOOKING AT SECURITIES THAT BLANKFEIN AND COMPANY SOLD TO INVESTORS. WHAT BLANKFEIN AND COMPANY DID NOT SAY IS THAT THE SECURITIES IN PARTICULAR THAT THEY CREATED AND SOLD, WERE MEANT TO BE WORTHLESS, AND HEDGFUND MANAGER PAULSON WALKED AWAY WITH 1 BILLION AND GOLDMAN MADE 17 MILLION IN FEES.

[sueinmn]

08:51 AM on 09/22/2010

Your hard on the eyes, please get rid of the caps.

[dukeitout]

10:22 PM on 09/21/2010

Just did some rough calculations on the kind of crummy stock holder returns 3 of the biggest investment banks preformed for their stockholders over the last 10 years.

In Sep 2000 Goldman stock was 100; 2010 it was 150; per year gain was about 4 %.
In Sep 2000 Bank of America stock was 30; 2010 it was 14; per year loss was about 6 %.
In Sep 2000 Citigroup stock was 40; 2010 it was 4; per year loss was about 20 %.

Conclusion: Goldman Sachs was less bad than the other two.

[selenasade]

08:51 AM on 09/22/2010

I have no financial knowledge but a few years ago, I did some rough calculations after a particular stock market crash. The conclusion was no ordinary person ever makes more than a modest return on their money, in the long run, unless they work at it full time themselves. So, I decided to play safe. The outcome is I haven't made a killing but then I haven't lost anything. So, I am better off than my friends.