If it's January, it's bonus season on Wall Street. It remains to be seen if the public has the energy to spend on the billion-dollar payouts at the nation's largest firms, but we'll likely hear a sober defense from the industry that includes a reminder that banks had a boffo 2009; they have to pay to retain top talent; and they're paid minimal salaries and rely on bonuses for total comp.
Here's what we're not likely to hear from the industry: thanks for the TARP funds -- yes, we repaid our obligations, but we were close to failing in 2008; double-thanks for the ultra-cheap money which we used to make lots of money on our prop trading desks; and triple thanks for making sure that there were no long-term strings attached that would limit our compensation after we repaid the money.
I'm struck but the irony that banks are declaring bonuses the same week that the Financial Crisis Inquiry Commission (finally) holds public hearings in DC. Though hailed as the Great Recession's Pecora, I'm not setting the bar too high. Still, it might be fun theater to watch Fat Cat CEO grilling.
Image by Flickr User klynslis, CC 2.0
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