AIG

[RIROCKHOUND]

No discussion of them using bailout money for bonuses? or are we just used to it...

[BigFish]

I blame the government for not having the foresight to see these types of situations arising and having stipulations attached to the bailout money! I feared this money would be misappropriated from the get go......enough friggin bailouts!!!! Let these companies/banks roll over and die. The taxpayers are paying the freight and the price is getting too high! S-H-I-T like this happens and they continue to hand out money!!!!

[Raven]

From everything i've read and heard about A I G

they were the lead Domino that would have started a very negative
CHAIN REACTION if we had let them go Under

so while i'm in AGREEMENT with you Larry i also respect that LOGIC

but here we have a PERFECT scenario to test the waters for accountability in the OBAMA administration to see if this
misappropriations of Bailout monies will be addressed.

I read that it was written into their contracts to receive these
bonuses ......or..... the people receiving them could just sue AIG for them which would amount to the very same thing.

[JohnR]

The "news" reports that is contractual bonuses that were contracted before the plunge and TARP and bailouts, etc...

This is contractual, they have to do it.

OTH, if I were at the helm of AIG, I'd be telling folk you can have part of your bonus & a pinkslip through that door or you job and no bonus through that door. No its not fair but it really is not fair to the people that are paying for this bailout.

Oh, wait a minute, we're not paying for it, China is. And they are already publibly berating the US to make good on it, and they are tired of reaching into their pockets. Just in time for China to be flexing their muscles in a maritime lebensraum.

[Raven]

it's early.... lebensraum.
some of us FARMERS have never even seen that word

[fishsmith]

nothing changes, just like obamas promise of no earmarks, 6 million for the kennedy library, wtf. The rich get richer, and everyday joe gets a paycut, then bends over and readys for an increased income tax. thank you sir, may I have another.

[Crafty Angler]

Rav, it means we're gonna be in the scheiser with them soon...

My wife is German American...

Achtung, baby...

[Raven]

i read once that they have enough of a population to make a land bridge to America out of dead bodies across the ocean....

[spence]

I'd have to assume these were legally binding otherwise the Government would try to stop them.

What's almost worse are the retention pay increases they say are necessary to keep top talent? Like who the %$%$%$%$ got AIG into this mess in the first place?

AIG should be thankful their doors are open.

-spence

[Travis]

Originally Posted by spence

I'd have to assume these were legally binding otherwise the Government would try to stop them.



AIG should be thankful their doors are open.

-spence

How can they be legally binding...we are talking about a bail out...any previous agreement should be NULL AND VOID as it is TAX MONEY to bail them out...there should be NO SLACK at all for this, the government and current administration is absolutely at fault. WRECKLESS SPENDING and another Pelosi trip on the tax payers private jet...And I thought the republicans were always the ones with the blinders on????? Things are out of control.

[Raven]

Originally Posted by Crafty Angler

Rav,
My wife is German American...

I presume she can make a cake upside down.

[TheSpecialist]

It's funny they can make the Automakers redo contracts wih the UAW, but not the %$%$%$%$%$%$%$%$s that got us in the predicament.

[RIJIMMY]

ok - lets do something really, really, really wacky, lets form our opinions based on something we lack - DETAILS!!

I want to know, how many exempt (people who dont get paid overtime) employees with a salary less than 100K got bonuses? What was the average percentage of their base salary?

How many making more than 100k got bonuses, what was their percentage of pay?
How much of the bonuses were paid to sales? Admin? Technology?

Lets know who got this money before throwing stones. Some IT guy working 60 hours a week, making 70k a year and getting no overtime, deserves a bonus in my book.

[buckman]

Should have never bailed them out. Then we wouldn't be having this discussion. We will be having similar discussions about every company involved in the great $$$ give away of 09.

[sokinwet]

http://dealbook.blogs.nytimes.com/20...s-information/

Good NYT current article. This is going to get interesting. Notice what division is getting this $$...not any IT types is my guess.

[BigFish]

Originally Posted by buckman

Should have never bailed them out. Then we wouldn't be having this discussion. We will be having similar discussions about every company involved in the great $$$ give away of 09.

I said the same thing when Bush signed his bailout.......and didn't they screw us then!! Lavish trips all expenses paid for the execs plus bonuses!!! We should demand back every penny and let them do what businesses are supposed to do when things go bad because companies are run into the ground......go chapter 11 or go out of business! End of "F'in" story! I am sick and tired of this crap....what the "F" is wrong with these people?!!!!!!!!

[BigFish]

Stimulus???? Whats with the first 7 million coming to Mass. going to the Kennedy Library???? What the "F" is that all about???? Paying back a political favor perhaps??? They say it will create jobs???!!!! Paleeeeeezzzzz!!!! How many friggin' jobs will be created at a Library????? Criminals all of them and its high time we as a people begin seeing them for what they are!!!

[spence]

Originally Posted by RIJIMMY

Lets know who got this money before throwing stones. Some IT guy working 60 hours a week, making 70k a year and getting no overtime, deserves a bonus in my book.

Yea, the IT staff has a contractually binding bonus agreement

Good one.

From what I hear these were the folks managing the credit default swaps at the center of this mess.

-spence

[Travis]

Originally Posted by RIJIMMY

ok - lets do something really, really, really wacky, lets form our opinions based on something we lack - DETAILS!!

I want to know, how many exempt (people who dont get paid overtime) employees with a salary less than 100K got bonuses? What was the average percentage of their base salary?

How many making more than 100k got bonuses, what was their percentage of pay?
How much of the bonuses were paid to sales? Admin? Technology?

Lets know who got this money before throwing stones. Some IT guy working 60 hours a week, making 70k a year and getting no overtime, deserves a bonus in my book.

It doesn't matter who what when where or why....they were bailed out! The alternative is that your character loses his job...sometimes sacrifice is required, another thing people can't fathom...

[RIROCKHOUND]

Well; we own 80% of AIG, right? then give them 20% of the bonuses.

I think the ball was dropped that this wasn't stipulated in the original deal.
On the other hand, it is 170Mil out of 175Bil, or there abouts, right? So it is ~0.1% of the total AIG bailout....

[BigFish]

Why is there no Government oversight as to how this money is spent???? Why???? Why????

[RIJIMMY]

Originally Posted by spence

Yea, the IT staff has a contractually binding bonus agreement

Good one.

From what I hear these were the folks managing the credit default swaps at the center of this mess.

-spence

"from what I hear" is from a media too stupid to ask the right questions.
I'm not sure what contreactually binding means in this scenario, but I bet there are divisions of AIG that are profitable and I bet IT and Admin people have an offer letter that stipulates a bonus payout. That could be a legal mess.

[RIJIMMY]

another one for the morons. Great idea, but err, arent their bonuses ALREADY taxed, duh!!!
Democrats - you need AIG more than AIG needs you. I wish their employees organized and said FU and stayed home. Wanted to see how much money wou;d be lost in one day?

WASHINGTON (CNN) -- Sen. Christopher Dodd on Monday suggested a tax provision to recoup the bonuses for executives of ailing insurance giant AIG.


Sen. Chris Dodd said the government could apply a tax to the AIG bonuses.

1 of 3 Dodd, D-Connecticut, said the notion is in the "earliest of thinking" and has not been settled on as a way to resolve the issue, which has set off outrage in Washington and across the country.

The tax would apply only to those at AIG who have received bonuses. The provision would help the government get back the money in the form of tax revenue.

[sokinwet]

" "from what I hear" is from a media too stupid to ask the right questions."
It appears that AIG is refusing to release the info. to a request from the NY Attorney General....agreed the media is "dumbed down" to the level of the avg. idiot but that doesn't seem to be the case here.

[fishbones]

Originally Posted by RIJIMMY

another one for the morons. Great idea, but err, arent their bonuses ALREADY taxed, duh!!!
Democrats - you need AIG more than AIG needs you. I wish their employees organized and said FU and stayed home. Wanted to see how much money wou;d be lost in one day?

WASHINGTON (CNN) -- Sen. Christopher Dodd on Monday suggested a tax provision to recoup the bonuses for executives of ailing insurance giant AIG.


Sen. Chris Dodd said the government could apply a tax to the AIG bonuses.

1 of 3 Dodd, D-Connecticut, said the notion is in the "earliest of thinking" and has not been settled on as a way to resolve the issue, which has set off outrage in Washington and across the country.

The tax would apply only to those at AIG who have received bonuses. The provision would help the government get back the money in the form of tax revenue.

Dodd's notion is in the "earliest of thinking"? Doesn't seem like there's much thought to it at all. You're right, Jimmy. Bonuses are taxed. They're taxed at a much higher rate than normal pay because the tax is progressive. It's good to know that Dodd has a career in politics because he wouldn't get by very well in the real world.

I also read this morning that Geitner might be coming under some fire for the bonus fiasco. There's some talk that he was aware of the AIG bonuses and didn't mention it to anyone. If that's true, he's off to a bit of a rough start.

[spence]

Originally Posted by fishbones

Dodd's notion is in the "earliest of thinking"? Doesn't seem like there's much thought to it at all. You're right, Jimmy. Bonuses are taxed. They're taxed at a much higher rate than normal pay because the tax is progressive. It's good to know that Dodd has a career in politics because he wouldn't get by very well in the real world.

A bonus is taxed just like income when you file your return, it's the withholding that's usually taxed at a higher rate as the calculations typically assume you're going to be earning that extra money every period...or it's a flat rate that's often higher than your regular tax rate.

Generally speaking, most people don't really care unless you're trying to defer tax payments or you really need the cash.

-spence

[RIJIMMY]

As much as we might want to void those A.I.G. pay contracts, Pearl Meyer, a compensation consultant at Steven Hall & Partners, says it would put American business on a worse slippery slope than it already is. Business agreements of other companies that have taken taxpayer money might fall into question. Even companies that have not turned to Washington might seize the opportunity to break inconvenient contracts.

If government officials were to break the contracts, they would be “breaking a bond,” Ms. Meyer says. “They are raising a whole new question about the trust and commitment organizations have to their employees.” (The auto industry unions are facing a similar issue — but the big difference is that there is a negotiation; no one is unilaterally tearing up contracts.)

But what about the commitment to taxpayers? Here is the second, perhaps more sobering thought: A.I.G. built this bomb, and it may be the only outfit that really knows how to defuse it.

A.I.G. employees concocted complex derivatives that then wormed their way through the global financial system. If they leave — the buzz on Wall Street is that some have, and more are ready to — they might simply turn around and trade against A.I.G.’s book. Why not? They know how bad it is. They built it.

So as unpalatable as it seems, taxpayers need to keep some of these brainiacs in their seats, if only to prevent them from turning against the company. In the end, we may actually be better off if they can figure out how to unwind these tricky investments.

Not that any of this takes the bite out of paying these bonuses. For better or worse — in this case, worse — someone at A.I.G. decided this company needed to sign bonus agreements last year to keep people before the full extent of its problems became clear.

Now we can debate why A.I.G. felt it necessary to guarantee seven executives at least $3 million apiece when the economy was clearly on shaky ground. Perhaps we will find out these contracts were a bit of sleight of hand to enrich executives who knew this financial Titanic had hit the iceberg. But another possible explanation is that A.I.G. knew it needed to keep its people.

That is the explanation offered by Edward M. Liddy, who was installed as A.I.G.’s chief executive when the government effectively nationalized the company last fall. (He is being paid $1 a year.)

“We cannot attract and retain the best and brightest talent to lead and staff” the company “if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury,” he said.

There’s some truth to what Mr. Liddy is saying. Would you want to work at A.I.G.? Sure, maybe for $3 million. But not if you could go somewhere else for even more — or even much less.

“The jobs are terrible,” said Robert M. Sedgwick, an executive compensation lawyer at Morrison Cohen who represents a number of employees of banks that have taken government money. “You have to read about yourself in the paper every day. These people are leaving as soon as they can.”

Let them leave, you say. Where would they go, given the troubles in the financial industry? But the fact is, the real moneymakers in finance always have a place to go. You can bet that someone would scoop up the talent from A.I.G. and, quite possibly, put it to work — against taxpayers’ interests.

“The word on the street is that A.I.G. employees are being heavily recruited,” Ms. Meyer says.

[spence]

Originally Posted by RIJIMMY

If government officials were to break the contracts, they would be “breaking a bond,” Ms. Meyer says. “They are raising a whole new question about the trust and commitment organizations have to their employees.”

This is perhaps the biggest crock of %$%$%$%$ I've ever heard.

These executives understood exactly the risk they were putting AIG under when they chose to insure sub-prime loans from default without adequate cash ratios in the bank.

What people don't realize is that a lot of the money sent to AIG is then being sent to other banks as insurance payoffs for mortgage defaults, because the exects at AIG gambled on the premise that housing prices would never fall and they would never have to pay out.

Sounds like a ponzi scheme to me. "Bond" my ass...

-spence

[Fishpart]

You mean Barney Frank and Chris Dodd didn't think of htis $hit when they crafted the basis of the legislation in the Senate Banking Comittee??

Congress is responsible for 90% of the mess we are in as they are the comittes who develop the legislation and get a majority vote from both houses of congress and then get the President to sign.

[Raven]

obama is on the scent.....

ooooh i hate to be those guys right now