Greedy Bankers Paying Themselves Huge Bonuses. They Still Don’t Get It.

October 15, 2009

R.F. Wilson writes: In case you’ve missed the big news from the financial world, the investment bank Goldman Sachs is planning to pay its employees in Britain bonuses totalling £14 billion, the biggest ever pay-outs in its 140-year history. On average these hard working people would get around £500,000 each, with the top directors standing to be awarded many millions.

Other banks in the City are expected to follow suit and pay themselves some serious bonuses as well. The only difference now is that the bulk of the bonuses will be paid in shares. But make no mistake, this is not much different from getting cash, as there are many ways that you can use your shares to raise capital very quickly.

So what does it tell us about the money men? Well, the saddest thing of all is that they took all of us for a ride, used our money to get out of the mess that they themselves had created in the first place and are now rewarding themselves while everyone else is struggling to cope with the recession. The Great Swindle of this century is still going strong. The middle men, who create absolutely nothing and gamble with other people’s money, are on a roll. And the British government is playing up to them and pretending that it can do absolutely nothing to force the greedy bankers stop paying themselves huge bonuses. It is all about the free market you see: free to be abused by the arrogant money men but never actually that free when it comes to protecting the interests of the ever suffering taxpayers.

Now I have several questions to ask, being a cynical man: how could it happen that despite the so-called ‘pressure’ from the British government, and personally from the Chancellor, Alistair Darling, the money boys still do whatever they want? Should they not be rewarding the taxpayers with hefty bonuses for saving their miserable skins? How come that when it was doom and gloom in the banking world that everyone had to chip in to keep the banks afloat, but once they got out of the mess, leaving the rest of the economy in tatters, by the way, they are celebrating all by themselves?

Another question: if an investment bank like Goldman Sachs is making huge profits again it must mean that it has been investing all that money into projects that are supposed to benefit, at least to some extent, other industries. But if so, it is very difficult to see which of the industries, say, in recession hit Britain are getting all the investment. Manufacturing continues its slide and unemployment is rising. So that means that Goldman Sachs and the rest of the investment banks in the City have been up to their old tricks again: packaging and repackaging debts and propping up economies that flood the world with their cheap products that nobody really needs anymore.

And now for the killer question: if the governments across the Western world, Britain included, of course, cannot supposedly force the money men to stop paying themselves obscene bonuses, does it not mean that ministers in these government must be directly or indirectly profiting from these bonuses. Otherwise what would be the reason for them not to hit the banker boys hard with all sorts of sanctions to make them listen to reason. Government, by the way, have a lot of means at their disposal to force the money men to comply with their instructions. Do not forget, that governments give the banks licenses to operate and they can always recall them or at least threaten to do that. So if the money men ignore what governments tell them then it means there is something very odd and I would even say illegal happening.

And another thing: the money men are behaving now in a way as if the current recession is coming to an end. It is not the case at all. The fact that astronomical amounts of public money were spent on bailing out failed banks does not mean that the economy as a whole has been revived. The banks are still not lending properly, because they know they would need to cover up their losses that have not yet been revealed. So the bonuses that we are hearing about are just a way of pulling out as much money as possible from the ‘pot’ before the next wave of the financial crisis hits the banking sector.

These banker boys have no shame. It is enough to look at their ugly mugs to see what sort of people they are. They do not give a damn about anyone but themselves. But they are not even bright enough to understand that when the rest of the economy is going down it will eventually bring them all down with it. A feast during a plague, as they used to say in the Middle Ages, always ends in a terrible hangover. I would add to it the more recent wisdom that says that you should never build your prosperity on other people’s grief or you risk losing your fortune as quickly as you made it. If not even quicker.

This is something, though, that they do not teach in investment banking. And in banking generally.

– End –

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