Bonuses For AIG

[elucidator]

@Scylla

That’s so dramatic. You could just ask, and I’ll tell you why the salaries for traders are what they are…

Aww, c’mon, Big Guy, gimmee a break! We both know when you get your dander up, you can be as dramatic as a busload of divas driving over a cliff!

…First off, it’s not a job you would really want to do if it didn’t pay a lot. Some of the other jobs, like fireman, teacher, truck driver and farmer have their own rewards and attractions which are not financial. Being a trader has no such rewards…

Why do I care about that? My question was about value, not motivation. Whatever moves someone to take up an occupation is an interesting sidelight, perhaps, but doesn’t speak to whether or not the occupation is needful or valuable. I’ve a friend who can repair watches, he got into it because he actually loves precise and painstaking work with little tiny gears. I think he’s probably quite good at it, hard to know, since no one comes to him with watches to repair!

…To describe it, you use terms like “shuffling credit back and forth,” but few people actually understand how trading works and what it is, and why it’s important. That’s for the same reason few people understand calculus… It takes some work before you can do it.

I suspect we share a prejudice, one I’m laboring to rid myself of, we tend to think of smart people as somehow better, more deserving. And if only smart people can do something, that something must be important.

But, no, alas, smart is only a characteristic, not a virtue. Its a force-multiplier, a smart bad person is capable of evil, a dumb bad person is usually confined to malice and chaos.

So telling me that an occupation requires smartitude doesn’t really get to the issue.

…Traders carry empty gatorade bottles with them in the morning. Guess why?..

They chaw?

…So, there is a long process spent in finding you and training you and having you gain experience, and finally seeing if you have the knack. I’d say about one out of 50 that try to do it actually become traders…

Again, it;s difficult. Got it. Multiple times more difficult than farming or teaching? I have some friends who are both, I’ll pass that along. They have access to informative sites, they would be happy to tell you where to go.

…As a good trader, you provide enormous benefits to your firm…after by the salesforce and the company’s customers…

Which explains why the company finds him valuable. Why should I? And why should I imagine that he is multiple times more necessary? Sez who? in the vernacular.

In short, I ask about social value, you give me free market principles. I fear you have them confused. Or worse, you actually belive them to be the same.

[Scylla]

'Luce:

I tell you need to be smart, it takes a while to learn, and it’s very difficult, but that they can make a lot of money for the firms that employ them. You say “c’mon tell me why they get paid so much” I suspect your missing something fundamental if you can’t fill in the blanks from there.

I could tell you why it’s important to you:

Traders provide both efficiency and liquidity to markets. These are crucial qualities. At times like recently when they fail to do so the entire country suffers the consequences. Industries shut down, unemployment goes up, credit tightens, companies can’t do business or get goods to sell. In short everything falls apart.

[Scylla]

@elucidator

In short, I ask about social value, you give me free market principles. I fear you have them confused. Or worse, you actually belive them to be the same.

Liquidity and efficiency, then.

[Scylla]

@elucidator

In short, I ask about social value, you give me free market principles. I fear you have them confused. Or worse, you actually belive them to be the same.

Are you aware of a system of commerce that provides a higher social value to a society than capitalism?

That would be a new thing.

If you’re not aware of such a system than free market values do serve social value. I frankly find the fact that people think they don’t offensive, as you live in a society that enjoys substantial benefits from them.

[elucidator]

@Scylla

Are you aware of a system of commerce that provides a higher social value to a society than capitalism?..

Working on it. its taking a lot longer than we expected. Could use your help, if you’ve nothing better to do.

…That would be a new thing…

Duh.

…If you’re not aware of such a system than free market values do serve social value. I frankly find the fact that people think they don’t offensive, as you live in a society that enjoys substantial benefits from them.

Sorry. Nothing personal. If you get out of the way, we won’t bother you so much. Better still, you could help push…

But you keep coming back to a simpistic insistence that some value exists. That isn’t the question, the question is the value proportional to the privilege Do his children deserve better health care, better schools, better lives than the teacher’s child, or the farmers? Because of the exceptional value he creates? I think not. And certainly not multiples, not five times or ten. That’s* right *out!

[gonzomax]

@elucidator

Working on it. its taking a lot longer than we expected. Could use your help, if you’ve nothing better to do.
Duh.
Sorry. Nothing personal. If you get out of the way, we won’t bother you so much. Better still, you could help push…

But you keep coming back to a simpistic insistence that some value exists. That isn’t the question, the question is the value proportional to the privilege Do his children deserve better health care, better schools, better lives than the teacher’s child, or the farmers? Because of the exceptional value he creates? I think not. And certainly not multiples, not five times or ten. That’s* right *out!

The exceptional value he creates is balanced with the exceptional value he loses. Doesn’t matter .He gets big money and bonuses any way.These guys took a ride on the genius train when the market was easy. How are they doing now? They are getting canned and looking for jobs.

[Stratocaster]

@elucidator

But you keep coming back to a simpistic insistence that some value exists. That isn’t the question, the question is the value proportional to the privilege Do his children deserve better health care, better schools, better lives than the teacher’s child, or the farmers? Because of the exceptional value he creates? I think not. And certainly not multiples, not five times or ten. That’s* right *out!

Says who? Who decides what monetary value someone’s work equates to? You? A committee of kind, progressive-minded folk like you? Do traders make more than firemen? Less? What’s the calculus for that? We’ve seen how command economies operate, and it’s a disaster.

Your contribution is monetarily worth, by definition, what someone is willing to pay you. Not a penny more or less. No one “deserves” the highest level of health care; some people can afford it though. Government has an obligation to provide for those who legitimately require a safety net. Everyone else will unfortunately have to rely on the benefits they can derive by what someone is actually willing to pay them.

Is your progressive ideal really more “to each according to his needs, from each according to his skills” nonsense? I think you’re overestimating the opportunity this administration change presents.

[elucidator]

So, It Is Written, then, Stratocaster? One of those eternal verities that cannot be altered by mere men? Mind if we try anyway?

And, no, I don’t think I overestimate the progressiveness of the Obama admin. Left of center but very slightly, if at all, and swamped by immediate and urgent priorities.

[Enderw24]

@Scylla

Traders provide both efficiency and liquidity to markets. These are crucial qualities. At times like recently when they fail to do so the entire country suffers the consequences. Industries shut down, unemployment goes up, credit tightens, companies can’t do business or get goods to sell. In short everything falls apart.

Here’s the thing. The traders, the bankers, the lenders, the movers, the shakers, they didn’t “fail to do so” in the sense of “I won’t go back to work unless I’m paid,” they “failed to do so” in the sense of “I epically failed and brought down the entire world economy.”
You, the trader, are only a necessary and crucial component of this economy because we, all society we, have failed in determining what makes a viable economy.
Pushing paper back and forth isn’t it.
It certainly provides a needed service at times. But its role should be in the facilitation of trading of REAL goods and REAL services, not the further pushing of paper.
We as a society have failed in how our economy is structured. You, as financial representatives, have taken advantage of this fact. But don’t tell me that you’re crucial to our economic wellbeing just because you’ve gamed the system to ensure that to be the case. Don’t tell me it’s necessary for you to get back to work when there’s no incentive for you to do anything differently this time. And don’t tell me that you’re the only ones fit to fix it when this very fact is what’s wrong with our economy in the first place!

If our economy was based upon REAL goods and REAL services and not on pushing paper there’s no way we could have gotten into this mess to begin with. Sorry if I don’t feel like rewarding this structure with bonuses.

[tagos]

@Enderw24

Here’s the thing. The traders, the bankers, the lenders, the movers, the shakers, they didn’t “fail to do so” in the sense of “I won’t go back to work unless I’m paid,” they “failed to do so” in the sense of “I epically failed and brought down the entire world economy.”.

Which kind of givers the lie to all this ‘smartness’ bullshit.

What they mean by ‘smart’ is in fact ‘ruthless pursuit of narrow, short-term self interest.’ Which ended is a world disaster. These people are not smart, just greedy and uncaring of anyone else’s well-being. Sociopaths.

Sociopathy is not a desirable personality trait yet we handed the economy over to them.

[kaylasdad99]

@Enderw24

If our economy was based upon REAL goods and REAL services and not on pushing paper there’s no way we could have gotten into this mess to begin with. Sorry if I don’t feel like rewarding this structure with bonuses.

There could be an argument to be made that an economy based exclusively on REAL goods and REAL services could not possibly achieve and sustain the level of widespread technological sophistication that we enjoy today.

There COULD be an argument to be made. Or maybe there couldn’t. I’m not only the wrong person to make the argument, I’m the wrong person to evaluate whether such an argument is actually possible.

[Eva_Luna]

@kaylasdad99

There could be an argument to be made that an economy based exclusively on REAL goods and REAL services could not possibly achieve and sustain the level of widespread technological sophistication that we enjoy today.

There COULD be an argument to be made. Or maybe there couldn’t. I’m not only the wrong person to make the argument, I’m the wrong person to evaluate whether such an argument is actually possible.

For that matter, what is a “real service”?

[kaylasdad99]

Missed the edit window: P.S. if such an argument is actually put forward, ISTM that a corrollary to that argument might be that the degree of widespread technological sophistication we have achieved is ultimately unsustainable, even with paper-pushing being an essential engine, because of it relying on endless growth, which in a finite planet, is ultimately impossible.

And I’m tired, so I don’t want to hear any complaints about my using the word “ultimately” twice in that sentence.

[kaylasdad99]

@Eva_Luna

For that matter, what is a “real service”?

I wouldn’t presume to offer a definitive and comprehensive answer, but Washing My Breakfast Dishes In Exchange For Payment certainly comes in under that heading.

[elucidator]

Hullaballo tipped me off to this article in the Atlantic…

(Warning for tighty-rightys! Hullabaloo a very lefty site, anti-cooty protocols are useless, unwanted thoughts will penetrate your carapace like a sex-crazed bedbug, you have been warned!..)

Grain alcohol and rain water - Digby's Hullabaloo

The article available here:

The Quiet Coup

Opening paragraph:

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time…

I’m going to open a GD thread on this, and hereby invite your participation.

[VinylTurnip]

I’ve heard Simon Johnson saying (a couple of times recently) that essentially if the name “USA” were covered up, and they were simply reviewing the financial state of some unknown country’s economy, the IMF would immediately and without question recommend a temporary nationalization of the banks. The U.S. itself has wholeheartedly recommended nationalization for other countries under similar conditions. But— some of us are more equal than others, it would seem.

[ivylass]

@Ocean_Annie

However, it would be nice to believe people working in the financial industry understood the public outrage, and someone in a high profile position apologized for destroying the economy. If there was a sincere effort to make amends, I believe the American people would forgive. It’s the continued extravagance courtesy of the taxpayers on everything from private jets to compensation and then a defensive response to public anger that infuriates most people. Americans can’t expect universal healthcare because it’s too expensive, progressive tax policies discourage success, tax funded child care is extortion-- but executives are entitled to enrich themselves on the backs of the public.

Make amends for what? Holding up their end of the bargain? Doing what the company wanted them to do despite the fact that it was swirling around the bowl? The problem with the American people is that a lot of us are too ignorant to know exactly what is going on and are having a knee-jerk reaction while we grab the pitchforks. Where’s the outrage when Nancy Pelosi abuses the military because of her private jet demands? What about the billions wasted in pork barrel projects? If anyone needs to ask for forgiveness from the American people, it’s the federal government.

[gonzomax]

http://www.msnbc.msn.com/id/17035721/ The jet is a fake outrage. The sargeant at arms was the person involved. She is on the short list of presidential succession and the military is concerned about her safety. To go nonstop from DC to California just requires a bigger jet.

[gonzomax]

If the traders made millions and are owed a bonus, let AIG pay them out of the company money,not the TARP funds. If the company does not have the money, there is no bonus due. They did not make millions for well over 2 years. They lost a ton. That allows no bonus.
Many Wall Street traders are on the street. They will work cheaper. Isn’t that the American way? I suspect the overpaid and coddled traders are going to face a new financial reality.

[Digital_Stimulus]

@ivylass

Where’s the outrage when Nancy Pelosi abuses the military because of her private jet demands? What about the billions wasted in pork barrel projects?

Oh, dear…my apologies in advance for a potential hijack, but I’m pretty sure you’ve drunk the flavor-ade (although I’m willing to be shown incorrect).

My understanding is that the military not only approved and had zero issues with Pelosi’s flights, but that she flys less than prior-Speaker Hastert. As to the “billions wasted in pork”, that’s so nebulous as to be vacuous. But if you need to do some spleen venting, go for it – details, please.