Apparently even Wall Street executives think Wall Street bankers get paid too much.
That's the opinion of financial industry veteran Morgan Stanley CEO James Gorman, the Financial Times reports. Gorman says that under new pressure from increased regulation, big banks will have to rein in their pay rates.
“There’s way too much capacity and compensation is way too high,” Gorman said in an interview with the FT. “As a shareholder I’m sort of sympathetic to the shareholder view that the industry is still overpaid.”
This isn't the first time Gorman has criticized Wall Street pay. He said that Morgan Stanley employees unhappy with lower levels of compensation should "just leave," in an interview with Bloomberg TV in January.
Easy for him to say though. Last year, Gorman took home $10.5 million in total compensation. Of course, that pay package might be considered modest compared to other Wall Street CEOs, especially since it fell 25 percent from the year before. JPMorgan Chase CEO Jamie Dimon, for example, was paid $23 million last year (elite Wall Street CEOs generally got nice little raises last year, by the way).
But across the board, the belt is tightening on Wall Street, including at Morgan Stanley itself. The investment bank is set to cut 4,000 jobs by the end of this year and is also considering lower pay and bonuses in the new year, Bloomberg reports.
Also on HuffPost:
Trading Loss 'Puts Egg On Our Face'
Dimon said JPMorgan Chase's unexpected $2 billion loss on credit trades in May "<a href="http://www.huffingtonpost.com/2012/05/10/jpmorgan-chase-london-whale_n_1507662.html?ref=business" target="_hplink">puts egg on our face, and we deserve any criticism we get</a>."
Regulation 'The Nail In Our Coffin'
In March 2011, Dimon expressed his fear over new regulations, warning that higher capital requirements would be "pretty much the nail in our coffin for big American banks," according to the <a href="http://www.ft.com/intl/cms/s/0/3157bcbe-5b05-11e0-a290-00144feab49a.html?ftcamp=rss#axzz1IB5kVGLG" target="_hplink">Financial Times</a>.
Warning that limiting proprietary trading would also affect market making, <a href="http://www.cnbc.com/id/45986077/Jamie_Dimon_Regulators_Undermining_Economic_Objectives" target="_hplink">Dimon was quoted by CNBC</a>, "The United States has...the most liquid [capital markets in the world]. If you lose liquidity because you lose market making, you cost investors money."
'Little To Do With Financial Crisis'
"Proprietary trading had very little to do with the financial crisis," <a href="http://www.gurufocus.com/news/159099/interview--jpmorgan-ceo-jamie-dimon-on-regulation-volcker-rule-some-of-the-global-regulations-are-unamerican)" target="_hplink">Dimon told FOX Business Network Senior Correspondent Charlie Gasparino</a> in January, adding that "you can't even make markets for your clients" with the Volcker Rule.
Volcker 'Doesn't Understand'
"Paul Volcker by his own admission has said he doesn't understand capital markets," <a href="http://dealbook.nytimes.com/2012/04/06/what-volcker-rule-could-mean-for-jpmorgans-big-trades" target="_hplink">Dimon told FOX Business.</a> "He has proven that to me."
Volcker Rule Too Narrow
in February, Dimon asserted the Volcker Rule had been written too narrowly. "If you want to be trading, you have to have a lawyer and a psychiatrist sitting next to you determining what was your intent every time you did something," he was quoted as saying in <a href="http://news.businessweek.com/article.asp?documentKey=1377-aIjS6U8zr2Z8-1PEFKF7I5P2SI88Q43D587IV8L" target="_hplink">Businessweek</a>.