Wall Street faces more job cuts, smaller bonuses

Fri Oct 26, 2007 5:26pm EDT Email | Print | Digg | Reprints | Single Page | Recommend (0) <-> Text <+> Market News
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More Business & Investing News... By Joseph A. Giannone

NEW YORK, Oct 26 (Reuters) - As fallout from the summer credit crunch spreads, Wall Street faces more job cuts -- and smaller bonuses.

Investment banks have announced thousands of jobs cuts as investors stopped snapping up risky corporate loans, mortgage securities and complex asset-backed securities.

And headhunters who help bankers and traders find jobs see layoffs ahead.

"There could be massive layoffs in areas that were built up quickly over the past three to four years," Korn/Ferry headhunter Jonathan Kim said. "We'll see a number of cuts in the areas that lost money."

Investment banks have so far this year set aside 8 percent more money for compensation than they had for the first three quarters of last year. But do not expect bonuses to be higher at most investment banks, recruiters said.

"You can't lay off people and have high bonuses. That's unseemly," said John Challenger of outplacement firm Challenger, Gray & Christmas.

Wall Street's richly compensated bankers have been a major pillar of the New York City economy, supporting real estate prices and everything from five star dinners to expensive sports cars.

The five largest investment banks -- Goldman Sachs Group Inc (GS.N: Quote, Profile, Research), Morgan Stanley (MS.N: Quote, Profile, Research), Merrill Lynch and Co Inc (MER.N: Quote, Profile, Research), Lehman Brothers Holdings Inc (LEH.N: Quote, Profile, Research) and Bear Stearns Co Inc (BSC.N: Quote, Profile, Research) -- combined paid out a record $61 billion in compensation last year. Continued...

http://www.reuters.com/article/marketsNews/idUKN268033420071026?rpc=44

:nopity:

This is just another excuse.

the new Faux Business Channel. This is part of the reason I am sure he held the huge fund raiser for Hillary at his home for some more ideas he has coming in case she is elected.

:nopity:

My heart bleeds for them.