|
An answer to Travis
reply to my AIG thread from Travis -
RIJIMMY, you are comparing apples to oranges. I don't see how one is comparable to the other. AIG was bailed out from going bankrupt, not so they could still give bonuses to their employees. These bonuses are not the cost for doing business...a good employee would make sacrifices if he truly wanted to succeed or even have a job in this economy. Why is it that you think they are "owed" these bonuses? Bonuses are just that...they are given when a company is doing well and you have proven your worth. Well AIG needed to be bailed out, hence no bonus. I don't see what is confusing about any of this?
Travis, from my perspecitve of being in financial services for close to 18 years and working very closely with sales and portfolio managers , here is my response.
AIG is an EXTREMELY diverse company. They are an insurance company as well as an asset management company. Under the asset management arm are the managers of mutual funds and private large accounts as well as sales. These accounts are multi million dollar accounts that bring in TONS of $ into AIG. These people had NOTHING to do with the mortgage crisis. But since their investments, most likley they are in the same division.
A portfolio managers contract stipulates that if they beat the return on their benchmark, they get paid for that. Many, if they are good, make milllions. A salespersons contract says that the get commissions based on a % of the accounts they brought in.Many, if they are good, make millions.
So, if while working for AIG, these people made the returns or sales, they are contractually bound to get the money, they earned.
Now - I know the response, if no bailout, then they'd have no job and no bonus. True. But if they didnt do their job, AIG would be in 10X the hole they are in. Losses would be much greater since the revenue from sales and portfolio returns would be less.
Now, the record out here will show, I was AGAINST the bailout, but since the government invested in AIG, they NEED these people to do their jobs or else the losses will be greater. I dont know anyone at AIG, but I know many of these people at other firms. They are in HIGH demand. There are still portfolios to be managed and still accounts to be sold. My comparison to real estate agents and construction was to demonstrate that as a results of bailouts, people will make $. Thats a good thing. My hope is that they EARN the money. While you may think that the bonuses are extravagant, thats what the markets pay. Other companies can and will pay if AIG wont.
Most importantly to me is the right of the government, without prior agreement to strip away peoples money they earned. this is a massive abuse of power. Where will it stop?
|
Linear Mode
