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Goldman Leads Wall Street Bonus War

Posted Nov 19, 07 11:56 AM CST in Business 

(Newser) – The Big Five Wall Street securities firms will pay $38 billion in bonuses this year—up from $36 billion last year—while shareholders tote up $74 billion in losses, their worst year since 2002, Bloomberg reports. All but Goldman Sachs lost more than 20% of their market value, says an analyst, but "they're all going to have to fall into line. If Bear and Merrill plead poverty, they're going to lose all of their good people.''

The bigger bonus pool stems from record earnings in acquisitions, IPOs, and sales of junk bonds, according to an analysis of bonuses at Goldman Sachs, Lehman Bros., Merrill Lynch, Morgan Stanley, and Bear Stearns. Record earnings at Goldman are setting the pace: "They're playing a good hand as aggressively as you can play it,'' said John Gutfreund, former Salomon Brothers CEO, putting competitors in "an awkward position.''

Source Bloomberg

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People walk past the Merrill Lynch building on Thursday, Nov. 15, 2007 in New York. John Thain, CEO of NYSE Euronext, was chosen on Wednesday to lead Merrill Lynch effective Dec. 1. (AP Photo/Brian McDermott)   (Associated Press)
A man checks his PDA outside the headquarters of Merrill Lynch & Co., Wednesday, Nov. 14, 2007, in New York.   (Associated Press)
Merrill Lynch's newly appointed CEO John Thain is seen in Davos, Switzerland in this Jan. 29, 2005 file photo.   (Associated Press)
Stanley O'Neal, lost his job as Chairman and CEO of Merrill Lynch & Co., after the company's dismal performance in 2007.   (Associated Press)
This undated handout file photograph of Goldman Sachs president and chief operating officer Lloyd Blankfein was released by the Wall Street investment bank, Friday, June 2, 2006. Associated Press reporters...   (Associated Press)
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Wall Street • Lehman Brothers • Bear Stearns • Merrill Lynch • Goldman Sachs • Morgan Stanley • bonuses • investment bankers


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