Goldman Chairman Gets a Bonus of $53.4 Million

Goldman Sachs paid Lloyd C. Blankfein, its chairman and chief executive, a bonus of $53.4 million in 2006, the highest ever for a Wall Street chief executive.

Added to his $600,000 salary, the bonus means that Mr. Blankfein will make $54 million this year, up from $38 million last year. The bank’s compensation committee awarded him $27.3 million in cash, $15.7 million in restricted stock and options to buy Goldman stock valued at $10.5 million.

The payout comes a week after Goldman reported a record profit of $9.5 billion, or $19.69 per diluted share, in 2006. Its stock price is up almost 60 percent for the year, and the firm’s market capitalization is nearly $90 billion, more than triple its value when it went public in May 1999.



http://www.nytimes.com/2006/12/20/business/20wall.html?ref=business

source: NewsMeat http://en.wikipedia.org/wiki/Henry_Paulson

You don't see that every day.

It's simply vulgar. It also represents all that is wrong with our society and why we are in a decline: that we so glorify money and the individual who HAS it and pay minimal lip service to fighting poverty. When something like 1 in 4 or 5 children in this country live in poverty, we need to be disgusted with this kind of "gesture" rather than applaud it. Newsweek had an interesting aside recently when it highlighted what the top paid executive today (CEO of Walmart) makes compared to it's workers and that of his counterpart (in today's dollars) back in the late 60s or early 70s (CEO of GM). The GM guy would be making about $4 million in today's dollars. Walmart's guy was over $20 million. Those appear to be our "values" today.

for the most part-

:eyes:

Don't be a chump.

that well known Bush-loving organization. Paulson gave more to the League of Conservation Voters in 2004 than to republicans.

Let's not forget, chump, that the previous CEO was one Richard Rubin, SecTreas for Clinton.

On the amount above $5 million. It was good enough for the Eisenhower GOP era; it's good enough for now.

they are gouging the hell out of us in charges and fees, and manipulating corporate law thanks to their good good friends at the bushco administration...


www.cafepress.com/warisprofitable <<<---

I'm sure he'd love an extra $6,000 on his bonus, which wouldn't even be missed from $53 million. Oh well...

$653,000,000 in spoils with they're 2500 employees (not evenly, of course)

Gnaw mean?

is $644,000. total bonuses, for the firm: 6.3 billion.

in comp to all of its employees...the mean will be $622K per employee...the median is probably well into the 6 figures.....If your brother is the mail guy, he probably got an extra $10K for Christmas....tell him to get you something nice!

Dreams are nice, though.

My brother is not the mail guy, by the way.

http://www.theage.com.au/news/business/streets-at-goldman-sachs-paved-with-bonus-gold/2006/12/14/1165685825093.html

I am sure your bro is not the mail guy - my point was that even the mail guy did well this year...so your bro probably did quite well also no matter what he does.

Not bonuses alone. The total bonuses handed out at Goldman this year stands at about $600 million, which is, as I said, quite a bit less than $16 BILLION, no? Reading is fundamental.

My boss is head of prop trading where I work...his salary is about $150K....his bonus is on the order of $10-$20M. The salary is to get by - it is all bonus that people care about.

You should also notice that I said $16.5B in total comp. Reading is indeed fundamental.

...and don't be such a fucking asshole.

How you get from total comp to the mailroom guy getting a $10,000 BONUS is an error in your logic, not my reading.

I'll be as big an asshole as I please, thank you.

:rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl: :rofl:

Besides...think about this...GS has 26000 employees. Divide 16.5B by 26000 and take note that the largest salaries are for the managing partners - very few of them - and they get $600K for salaries....most comp is in bonus form. A prop trader can expect to take down 10% of his/her PnL for the year. Bonus is where it is at. The other forms of comp have a lot less to do with it.

I'm done here.

The fact that you can't reason correctly doesn't affect me in the least bit.

He'll get all that money and still feel empty.

and tied in with the Dubai ports deal??

Senator and current governor of New Jersey (a Democrat).

The current Treasury Secretary is Henry "Hank" Paulson, chairman and CEO of Goldman Sachs from 1998-2006. http://en.wikipedia.org/wiki/Henry_Paulson

1. He produced and performed well for his company and was Captain of a ship that delivered record and overwhelming profits and value to his company and his shareholders.

2. There is nothing immoral about capitalism. The capitalistic system - with its incentive based ethic - is what moves people and countries to achieve.

3. It is not the right of a system, a government, or any one person to decide what is "enough" money for another person - especially one whose level of achievement and performance is exemplary on behalf of his company.

4. Anyone who believes - or, naively thinks - that directing and being the one man (or woman) responsible for a Ninety Billion Dollar enterprise is not a demanding task that requires a skill set far above the average person, is just plain dumb...

...that skill set rightfully and morally deserves rich rewards.

Kudos to Mr. Blankfein.

(there was another guy, the head of a brokerage/investment firm -forget his name, getting 40 million) comes in the same week that another big news story was that the number of people going hungry is growing in this country.

I find it interesting that you think this guy is SO SPECIAL that he deserves this much money. And for calling those of us who think his skill set isn't all that special dumb, I find your lack of a sense of moral 'rightness' or whatever you want to call it really pathetic. My idea of a really valuable skill set worthy of millions is the poor schmuck who helps the poor and the elderly, who takes care of the sick out on the streets and in the homeless shelters, who works to find shelter, medical care, and a hot meal for the homeless. Someone who works with the weakest of society. The cast offs, those that float under the radar of this cold society.

No doubt that community organizers provide invaluable services to our society.

I say it's too much. Also,he didn't make this money in a vacuum. Infrastructure of the USA sure helped. I bet he winds up paying squat as tax.

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thoughtful, cogent, and incisive reply and debate to the points I enumerated.

Oh and by the way, from the DU Rules:

"3. Civility: Treat other members with respect. Do not post personal attacks against other members of this discussion forum "

http://www.democraticunderground.com/forums/rules.html

A Merry Christmas and a Peaceful New Year to you and your family

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is to bring about the "greatest amount of good for the greatest number of people". Accumulating a great deal of wealth is an unintended consequence of the system, so it's perfectly reasonable for the State to have higher tax rates for people "earning" this kind of money.

The point of capitalism is for the individual to maximize personal profit. According to the theory, this act in and of itself gives you something like the greatest good as a side result - an accidental (moral) outcome of the individual (amoral) action.

Capitalism is not immoral. It is amoral - and explicitly so. The assumption of capitalism is that when individuals seek their own self-interest above all else, you get an equalizing effect in the aggregate. But the aggregate is not a moral precept, nor can it constitute an ethics. It is an utterly amoral system that is thought to spit out a "morally" justifiable aggregate through sheer accident.

lol

Seriously, though, there are supposed to be safeguards in the institutions of government as a means of keeping excesses in check. Like, for example, capital gains taxes.

No, of course capitalism doesn't work. Or rather, it works precisely to set up the conditions of its own demise, then mutates to form a new (similarly unsustainable) system that again verges towards its limit. There is no "capitalism." There have been, rather, many capitalisms.

sort of like an organic process of birth, growth, decay and rebirth. interesting.

;-)

and, precisely. Right on the mark.

Capitalism is, and should be, morally neutral.

Few here (and not me) would claim that capitalism is bad. Please don't misrepresent people's thoughts.

What people seem to be saying is that unchecked, unregulated markets are what lead to things like the Great Depression.

Big difference.

say that. They are not. Most of the hysteria in these posts seem to reflect a point of view that rewarding exceptional performance with exceptional reward is somehow immoral or unjust.

As for market regulation, I would argue that "markets" should have modest regulation, however the conduct, behaviour, practices, and standards of those practicing within the markets demand tight and aggressive oversight, stipulation, and control.

Two hours ago, you said, "...that skill set rightfully and morally deserves rich rewards.

But now you say, "Capitalism is, and should be, morally neutral."

Well, which is it? "Morally neutral" or "morally deserving"?

... is morally neutral. The product, or the reward, de facto, is moral in and of itself and was in reply to one of the posts above my own reply that claimed they were immoral.

Your neo-liberal views in your first post are a bit celebratory for the supposedly "morally neutral."

Capitalism is NOT interested in the social good, and thus produces very little of it. The laughable notion that you get moral results in the aggregate is disproved daily by the shocking state of the global South, or by global poverty more generally (and if you've ever sat in on a GS underwritten Third-World bond meeting, you would know that Goldman both directly contributes to this phenomenon and doesn't give a flying fuck about it) - all outcomes of specifically capitalist dynamics when it enters into relations with histories of colonialism, race, and gender.

Moreover, pure capitalism ignores the very real disproportion of power to pursue self-interest, as even Adam Smith recognized with regard to labor: it imagines a frictionless space that is more idealistic and divorced from reality than the most utopian anarchist.

In some cases, however, I think we need more capitalism, not less. Take immigration, for example. Pure capitalism would demand that borders (government regulation on the free movement of labor - a salable commodity - into markets where it will fetch higher prices) should be thrown open absolutely. Yes. That's exactly right. If there is free trade, there should also be free movement of labor: national borders, citizenship, immigration policy - all these are vestiges of the feudal state, and no capitalist worth his salt should be able to tolerate such non-market dynamics.

population is definitely immoral.

The current system (whatever you may call it) running in USA is immoral because of that - homelessness, hunger, lack of affordable health care, education, and housing.

The interesting point about this bonus news from Well Street is that many people think it's normal and okay for winners to take all, and it's okay to let unfortunate or helpless people die, thanks to the brain washing of the culture of the this particular system.

Would the democratic leaders and the congress do something about it?

there isn't a sufficient social safety net to take care of the poor.

Imagine what we could do with the money being poured into the desert in Iraq, for instance.

a well regulated capitalistic system distributes income as a direct result of economic activity, though it's hardly perfect which is why some accumulate so damn much.

Like Microsoft security patches.

is anti-regulation. That's the only way the strongest robber-baron can rise to the top and control the rest. Capitalism is nature's law of the jungle applied to economics. The strong survive, while the weak go extinct and starve.

would be at the level of bartering goods without government regulation.

The enforcement of contracts is a government regulation. Punishing fraud is a government regulation.

combined.

Who had a better year?

He certainly generated more profits for the bank than Manny or Alex generated for their respective teams...nobody bitches about Manny or Alex (unless you are from NY)...paying the ball players less would have just made the owners richer anyway.


Also, we cannot just raise taxes to 75% or something crazy like that (responding to others in this thread who have suggested so)....the money would go straight to the military industrial complex anyway. Raising them back to Pre-* levels would be the right thing to do, but any more than that is wrong. Before raising taxes significantly, we must first prove that the money will be well spent and I see no evidence of that. Would anybody really want to make this war machine even more crazy? No. If money would be well spent, I would be less fearful of tax raises. There is so much inefficiency and outright theft that it is disgusting. Raising taxes would only mean more to steal for the top execs of Big Pharma, Healthcare, and the defense industry. All others would get fucked - including the poor.

Government regulation is but an attempt to level the playing field, and the last five years have shown us how well that works, haven't they.

The true capitalist will find a way to rise to the top. In our case that means owning or controlling the government regulators. Once again the most fit rise to the top and survive, while the rest of us starve. It was ever so, no matter what label you put on the economic system.

As some philosopher once said: Living with corporations is like swimming with sharks. You want to keep a sharp eye on them, and you need to be able to kill them when they turn on you. Which they will. It's just their nature.

is there any amount of $ you would consider to be "too much"?

I won't hold my breath waiting for your answer :eyes:

there is not.

NOTHING, they don't even make anything.

This is simply a reward for looting other people in investment banking. Would markets be any better or worse off if the company didn't even exist? No, it wouldn't matter the game would just be less rigged.

Goldman itself may not have a factory, but those people who do have factories often need money to start a new product line or expand, or refurbish. When they do need money, they can either sell a stock or bond themselves - a tedious project, since they are makers of widgets and not sellers of securities - or they can sell it in a lump to an underwriter, who takes the bulk at a premium for undertaking the risk of trying to sell said security. That what Goldman does. So, when you ask "What has Goldman made this year?" you can look at all the securities that they were underwriters for, and see what THOSE companies made, and you'd have your answer. Look it up:

http://www.sec.gov/edgar.shtml

They provide a whole bunch of financial duties for their (often absurdly rich) clients, including merger and acquisition advice and offshoring advice. For example, when a U.S. company wants to shut down its American facilities and move them to say, Taiwan, they might hire Goldman Sachs to do the planning for them.

:shrug:

As they provide services for their clients.

play a vital and critical role in bringing capital to those innovators (i.e., Gates), inventors, and entrepreneurs who then design, develop, and build the companies and institutions that provide tens of thousands of products and services to everyone of us as consumers and employ hundreds of millions of our fellow citizens...

...including, I suspect, a few on this board.

Investment bankers do not "loot," without their facilitation of capital, nothing would happen and we would all die.

dumps, and New York has Investment Bankers?

Answer: New Jersey had first choice.

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and no conscience. Their followers, supporters and enablers are NO BETTER.

.. with specific and direct evidence and citations, where the man who is the subject of this thread has engaged in, or been indicted for, criminal behaviour.

Further, kindly provide with specific and direct citations, evidence of where the same man has engaged in behaviour that could even modestly described as a "swindle."

Thank you.

1) The SEC determined that Goldman Sachs had committed a whole host of financial abuses, and ordered the company to pay $110,000,000 in fines. Goldman Sachs arranged a plea deal so they'll only pay $25,000,000.

http://www.sec.gov/litigation/litreleases/judg18113.pdf

2) In a separate case involving other investment banks, Goldman Sachs was fined this past July for book keeping practices that were essentially a method to manipulate stock values:

http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=60768

We'll never know how many small-time investors lost money -- or even their shirts -- because of Goldman Sach's efforts to pad the profits of their own, big-time clients.

corporate name while THEY conduct their heinous reallocation of most of the wealth to an elite very few. Fraud and conspiracy, to identify only two atrocities of business, are commonplace and rarely individually prosecuted, if at all. brentspeak, Reply 53. identified a couple indictments while there are several others. The dismantling and leeching of the American workplace by wall street and their shareholders, in an attempt to feed their insatiable greed, is a national disgrace.

n/t

Now what could be more American than being selfish?

:sarcasm: mode now off

Greed is a strong motivator, but it has nothing to do with ethics or morality.

The problem, as you point out, is that for some people there's no such thing as enough.

We need to change the current system, imo. Capitalism is not immoral. Greed is immoral and the few owning most of the wealth produced by the many is immoral, imo. It will continue on until the many decide to make laws and enforce them to change the system and iron out the problems.

If Mr. CEO is for Unions and collective bargaining so that the workers can make as much as they possibly can then that is a good thing. If Mr. CEO fights the workers and limits their salary and benefits and cites "the shareholders" and "the bottom line" as the reasons then Mr. CEO is an hypocrite when he squalls that he should be able to take as much as he can get. Money is power. To use that power to deny the worker a level playing field is immoral.

I hope to live to see all of the greedy inequity challenged and changed. Capitalism is o.k. Malignant capitalism where the 2% own 50% of all the wealth is broken and needs fixing. IMHO.

You are absolutely correct. However, have you ever read the "Million Dollar Bank Note" by Mr. Twain?
I'm just sayin............. :shrug:

Sorry it should read "Million Pound...."

I would like to email him and borrow some money for a Christmas dinner for my family...
A small roast beef would be fine...perhaps a few potatoes...some frozen veggies...
the fresh ones are too expensive...
Somebody give me his email...

FirstName.LastName@gs.com

Though his secretary may filter a lot of emails and I-Banks have excellent spam filters. Hotmail addresses may be blocked. Other corporate emails may work though. I am not completely sure as I do not work at GS.

The current NJ Governor Jon Corzine and Clinton's Secretary of State Bob Rubin both came from Goldman. Of course, so did Paulsen. Goldman paid union wages to construct its building in Jersey City and it pays workers extremely well from top to bottom. It also willingly pays more taxes than any other investment firm; unlike others, it never disputes tax payments.

It also has more money than God. Smart people work there.

... let's not totally destroy all of the hysterical preconceptions of evil that this thread has demonstrated vis-a-vis the accomplished, wealthy, and justly compensated for their success. They just can't be Democrats, Progressives, and Liberals, much less philanthropically oriented as well. Or, can they?

(Thanks for your post pointing it all out. And yes, I know a few at GS; they are very exceptional and bright people.)

My brother works at Goldman.

Your appeal to philanthropy is cute, but incoherent (see my post up-thread on this point), as is most capitalist celebration. Of course, if you stay focused on the "person" rather than the concepts you're using to warrant your conclusions, then you never have to deal with your own incoherence.

Cheers.

But fair is fair and true is true. Goldman is the gold standard in finance. No one is better.

You're quite welcome.

http://en.wikipedia.org/wiki/Henry_Paulson

get a clue. Everything is not Blue - Red. These people are one thing only: money-green. They are literally laughing all the way to the bank while we quibble about fake partisan issues.

These guys are most definitely not on our side.

I mentioned Paulson. And, yes, I am well aware that they laugh all he way to the bank.

Who do you think bankrolls Dems, including left-libs? Clean money? Just unions? Think again.

Who gives to Charlie Rangel and other liberals? Goldman.

YOU CAN"T GO ANYWHERE ELSE FOR THE MONEY TO RUN A POLITICAL CAMPAIGN.

is actually not ridiculous--especially by what the standards are for CEO pay.

His bonus was .55% of the company's overall profit. That is a VERY low ratio compared to what others get.

$9.5 BILLION profit! How did they do that? Cook the books?

All the banks had a bonanza year. Goldman made a ton in M&A, COMMODITIES, and fixed income - the stock market also contributed, but had less to do with it.

Almost like the banks know something is going to cause a downfall, and they are reaping the big profits now.

And, if you think NY financial types are doing well, you should see how much the lads in London get.

Even to an employee I've had for only 2 months.

I hope GS rewarded all employees this year too.

probably got over $10K at Goldman....that is why people go into I-Banking/Trading - monster bonuses. The mean bonus at Goldman was $622K...harder to estimate the median, but probably still well into the 6 figures. There was $16B in spoils to go to the employees for bonus this year. I trade at a major bank and there are not nearly as many thugs here as you think...some are actaully very progressive (some), but most are quite reasonable. I have not met a single person who admits to liking * - not kidding. Of course, most people avoid talking politics as that can be bad for relationships that are important. I have met plenty of people that loathe * and others who have strongly hinted at it.

Our bank had a great year too and we are all licking our chops for the bonus we get next month. We earned it, but it does not mean that we do not empathize with the less fortunate.

The scumbags are the WMTs of the world (Shop Costco!), the HALs, etc....but the people at the banks are ok - you would be surprised.



The only arguments you can use against us that holds water is that there is a lot of wasted brainpower at the banks. My mom says it is such a shame that there are so many brilliant people and PhDs etc who are basically pro-gamblers when they can in fact be producing useful stuff for society. I disagree with her somewhat as the banks do provide capital to get things going - the trouble is that we live in a kleptocracy and that needs to be fixed. I was born to gamble and I cannot think of anything else I could possibly be good at other than solving esoteric math problems nobody cares about (which is why I did not become a math professor). If I failed to get into I-Banking, I would have been a Texas Hold 'Em professional. Thisis more fun. I love it. ok...I also had a good day today, so I am all fired up, but still know who the real enemies are - Big Pharma, The healthcare industry and its huge conflict of interest in providing good care, WMT, HAL, the defense industry, the M$M. Wall St is not in this set. We just place our bets accordingly.

There should be laws preventing CEOs from making more than 10-20 times what their lowest full time worker can potentially make in a year. That way, if they want a raise, their workers must get a raise first, while still allowing some flexibility in the pay of the CEO.

hey, look, this is capitalism. As I frequently say, if you don't like it, then let's change the system to what I think it should be: socialism. In a capitalist system like we have profit is unlimited. It's only limited by how much your taxed and by how much you can't swindle from your company.

I'm not supporting this by any stretch of the imagination on moral grounds but what I am saying is this: look, you live under this system:

Either change it or shut up and accept these obscene examples of corporate piracy.

"I'm not supporting this by any stretch of the imagination on moral grounds but what I am saying is this: look, you live under this system:"

Sounds so much like the familiar pap I've seen around here through the years.

"I hate Bush as much as anyone, but...."

"I'm a lifelong Democrat, but...."

"I'm no Republican, but...."

"Hey I voted for Clinton twice, but...."

I highly doubt you'd change the system if you could.

This is pure GREED. The only why they can do this is by screwing us. If the rich had to earn their money openly and honestly there would be a lot less of them. Instead of giving that bonus to him the money should have went into stock dividends. Sure there are rich people that own that stock but a lot is owned by small groups and little people also. So much for return on our investment. It's NOW time to rise up against the rich.

while kids go to bed hungry and millions are homeless. The ultimate obscenity is that the money was made off the backs of Americans whose jobs went overseas. Merry Christmas, Lloyd.

Wall Street companies increase their profits by massive outsourcing, in turn boosting the profits of brokerage firms whose employees then receive massive bonuses for their time.

Just don't tell Sam whose good-paying job was outsourced to India and who is now working for minimum wage down at the Quik Trip.

It reminds me of the Stephen Wright joke about the guy who had everything. Where'd he put it?

n/t

and he must have been asked about what he was making for a particular film. He replied "just how well can you eat, anyway?"

I loved him for that.

...but have never wanted to wade into the discussion before. I find this thread has some interesting points. I would like to put some things in perspective when discussing capitalism.

The whole premise of capitalism is that it is an economic system that favors capital. Sounds simple enough, but what is capital? Well, capital can be defined, with regard to capitalism, as wealth of any form used or available for the production of more wealth. Basically, capitalists are the owners of the means of production, so this economic system is geared toward the people that own the means of production and not toward labor which does the work. Since, I would guess, almost everyone here does not fall within the circle of capitalist I always wonder why so many support the system uncritically. Actually, upwards of 95% of the population doesn't fall within that designation. No excess is too much, no exploitation or abuse unjustified.

While capitalism is a great mechanism for creating new wealth, and I admit its better than any other system we know, it is also very amoral, a view mentioned in an earlier post that I came to agree with years ago. It can be used as a tool for society to produce the revenues to provide the services needed in society for all citizens to prosper; education, infrastructure and health care, to name just three. It usually does this by making sure the wealthy, corporations and companies are well regulated and taxed for the overall benefit of the society.

If the objective is to have wealth concentrated in a very small circle of individuals then you leave the system unfettered by regulation and control. You allow those with the capital resources to control government, which gives greater freedom to enhance their wealth at the expense of others, primarily labor. When society is selfish and self-centered, $53 million dollar yearly compensation for the stewards of capitalism is not seen as an aberration or embarrassment.