90% TARP Tax. Update - the Tax May Be "Dead".

[Budmantom]

Originally posted by: BoberFett
There are lots of talented analysts out of work right now. They'll probably work for less than millions. Are you going to claim this person is the only person in the world who can save us? How do you figure? Is there a big 'S' emblazoned on their chest?

Only one person can get us out of this worldwide recession/depression... Timothy Geithner so it's possible, he has DA written across his chest, I'm not sure what that means.

 

[Budmantom]

Originally posted by: bozack
Normally it is steal from the rich to give to the democratic base...here we have them punishing everyone, even those who had nothing to do with the situation at hand...

Those that think the top talent will work for a reduced price just because are dillusional...

The top talent will go to the companies that are doing well and the bottom feeders will spend the tax payers billions and keep coming back for more bailouts.

Just when you think AIG did a horrible job just wait to see what are elected officials will do.

 

[Budmantom]

Originally posted by: frostedflakes
Also should be mentioned that the bill isn't law yet, still has to be passed by the Senate and signed by Obama (although I can't imagine either one opposing it, who knows, maybe they'll come to their senses).

You are talking about dumb and dumber, I have a feeling that this administration and congress are trying to out dumb each other and it's too close to call.

 

[Budmantom]

Originally posted by: Wreckem

Originally posted by: Acanthus

Originally posted by: bozack
Normally it is steal from the rich to give to the democratic base...here we have them punishing everyone, even those who had nothing to do with the situation at hand...

Those that think the top talent will work for a reduced price just because are dillusional...

The top talent can go fuck themselves.

You dont get bonuses for running a company into the ground.

You dont get bonuses from a non-functioning company.

You dont get bonuses directly from taxpayer money.

Dont like it? Dont work for AIG.

In closing, fuck off.

The Govt should have just let them fail then. Instead of pumping in shit tons of money, chasing all the competent people off, just to see it fail in the end. In the end AIG will fail because no one will want to risk taking a chance and trying to right the company. I still cannot believe the general public is playing into Congress's fake outrage. Its the classic dog and pony show. Distract them over here with something relatively trivial, while raping and pillaging over there while no one is looking.

Agreed!

 

[Budmantom]

Originally posted by: Xellos2099

Originally posted by: sandorski

Originally posted by: Xellos2099
Maybe it is because when someone fulfill the contract, you pay them according to agreement, not months or years afterwarf unless it is stated by the contract.

I understand that, but given the circumstanes, especially that Bailout money is what makes the payments possible, it just makes sense to not Pay Out at this time. Add in the Public backlash and it seems a no-brainer to me. Although, perhaps they already mad the payout before the backlash occurred so it was too late to postpone it.

And to beat it all, it was the Obama who sign the contract that allow the bonus. To made the matter worse, if Obama have clear up the public misunderstanding of the bonus, it would have been fine . However, Obama decide to condemn the bonus, the very bonus he allowed and now try to tax it away. If this bill is allow to pass, the government would have lost all form of creditability to people who sign contract with them knowing it can be null at anytime.

Keep in mind this is a man that may or may not be good enough to be in the Special Olympics.

Obama will never accept any responsibility for his actions, the only things that man does well is give speeches and hold that chin up high.

 

[3chordcharlie]

Originally posted by: Fern

Originally posted by: 3chordcharlie
I'm sorry your client lost her bonus.

Perhaps at a time like this, AIG could have come up with a smarter plan than 'business as usual'.

I'm sorry, but the way things are run these days, anyone with a six-week training course could perform as well as the average 'talented analyst'. Maybe there's the odd one who is really better, but the 'million dollar bonuses for all' party was a symptom of the overall financial bubble, not an indication of actual value.

Anyone remember all those brilliant personal financial planners from the late 90's?

Re: Bolded part - you really do not understand the business (And Bobberfett, this applies to you as well. For someone like yourself who is such a libertarian type, I am very surprised to see you cheering on this government's confiscatory actions against 'innocent people')

Nor do you understand the core of the issue. These people are NOT executives. These people did NOT cause the problems (at least none I've yet heard of). In this particular case, the person is NOT employed in any toxic asset area (never has been).

The CDO's, MBS's etc (whichever name you prefer) are fairly new, and were a small part of these firms business. Small in the sense they were only a fraction of financial service product offerings. However, these small divisions were allowed to handle huge amounts of money (and risk), they caused the problems. Not the many many other divisions in these firms.

You are painting all people with the same brush as these CDO traders. It's wrong.

Here's an example some of you may remember:

The collapse of Britain's Barings Bank in February 1995 is perhaps the quintessential tale of financial risk management gone wrong. The failure was completely unexpected. Over a course of days, the bank went from apparent strength to bankruptcy. Barings was Britain's oldest merchant bank. It had financed the Napoleonic wars, the Louisiana purchase, and the Erie Canal. Barings was the Queen's bank. What really grabbed the world's attention was the fact that the failure was caused by the actions of a single trader based at a small office in Singapore.

The trader was Nick Leeson

One person brought this bank down. Similarly, (mostly) one division brought down these TARP firms. This 90% tax is hitting people who had nothing to do with this crap.

You people who insist on saying anybody off the street can do these jobs need to go read up on Nick Leeson. An inexperienced person who wasn't supervised closely enough. We don't need that crap in our (TARP) companies.

Fern

The problem, Fern, is that there were a whole bunch of Nick Leesons, at many different firms, and in a raging market, it can be hard to pick them out, because roughly speaking EVERYONE looked like a genius for a few years there.

I keep hearing about bonuses for performance - but in the next sentence we hear that these are mostly signing bonuses; as in bonuses not related to performance. I have some sympathy for the individuals who are having these bonuses taken away, though one can only cry so much for opportunists.

Perhaps analysts signing on could have had a bonus tied directly to performance, and the funds could have been locked up to make sure they were paid (say, if they succeeded, but the firm still failed). Perhaps large payouts could have been arranged on the contingency of a successful overall recovery.

Whatever the case, there was a serious betrayal of public trust here, and if you're right, and the people paying the price aren't the ones at fault, then they can join the millions who have discovered recently that this is, in fact, business as usual.

 

[Xellos2099]

It is Obama who is trying to lose public trust here. He agreed to the bonus in the contract he signed and when shit hit the fan he demonize it. There is not much or a law left if even the so call president can;t be abide to the contract law.

 

[steelodon]

Originally posted by: Budmantom

Originally posted by: Wreckem

Originally posted by: Acanthus

Originally posted by: bozack
Normally it is steal from the rich to give to the democratic base...here we have them punishing everyone, even those who had nothing to do with the situation at hand...

Those that think the top talent will work for a reduced price just because are dillusional...

The top talent can go fuck themselves.

You dont get bonuses for running a company into the ground.

You dont get bonuses from a non-functioning company.

You dont get bonuses directly from taxpayer money.

Dont like it? Dont work for AIG.

In closing, fuck off.

The Govt should have just let them fail then. Instead of pumping in shit tons of money, chasing all the competent people off, just to see it fail in the end. In the end AIG will fail because no one will want to risk taking a chance and trying to right the company. I still cannot believe the general public is playing into Congress's fake outrage. Its the classic dog and pony show. Distract them over here with something relatively trivial, while raping and pillaging over there while no one is looking.

Agreed!

Newt Grenrich said something very interesting about this entire situation. It may be time to break AIG into smaller companies. Secondly, I agree with the quotes above. Some of the executives from that crap division have already jumped this sinking ship. Their bonuses were not primarily for performance. Everyone should not suffer from the people that took a torpedo through AIG's massive hull.

 

[smack Down]

Originally posted by: Acanthus

Originally posted by: bozack
Normally it is steal from the rich to give to the democratic base...here we have them punishing everyone, even those who had nothing to do with the situation at hand...

Those that think the top talent will work for a reduced price just because are dillusional...

The top talent can go fuck themselves.

You dont get bonuses for running a company into the ground.

You dont get bonuses from a non-functioning company.

You dont get bonuses directly from taxpayer money.

Dont like it? Dont work for AIG.

In closing, fuck off.

QFT.

If AIG doesn't like it they are more then free to pay back the tax payers 150 Billion.

 

[Fern]

Advisers say Obama won't 'govern out of anger'

I'm pleased to see some unemotional common sense is begining to appear.

I've studied the '90% tax on bonuses' law and think it can improved. Currently, it is woefully inadequate in targeting anyone who was involved in bringing this financial mess about. And it seems from Obama and Congress's rhetoric they don't want these people getting bonuses, and certainly not from taxpayers' funds, so why not actually do that?

The Problems in The Current Law

The tax covers all employess at TARP companies (those who've received $5B or more in funds), and none in other (non-TARP) companies. However, much of the TARP money given to AIG (and others) was merely paid out to other banks who invested in their Credit Default Swaps and the like. So, these other (many foreign) banks are the actual recipients of our TARP funds, but are not subject to the 90% tax. IMO, that's a problem. They have our TARP money but we will not be getting it back if they use it for big bonuses.

The second problem is that those causing the problems may now be employed with a company NOT on the TARP list and thus get their bonuses but no 90% tax. So, they go 'unpunished', that's a problem.

"Innocent' investment bankers who had nothing to do with creating these problems and were subsequently hired by TARP companies to fix them are unneccesariy and unfairly punished, their contracts abrogated by the gov. That's a problem.

People who who don't even work in the financial products areas of these big conglomerates are now subject to the 90% bonus tax even though they don't have a d@mn thing to do with any of this. That's another big problem.

Suggested Solutions

I think some very minor changes could be made to improve the law, thereby avoiding confiscatory tax on 'innocents', and possibly clawing back bonuses form the guilty.

First, the only bonuses subject to the tax should for those employed in these financial products division. These other divisions didn't get TARP money, they didn't need it. This is easy to implement. These subsidiares are proper 'stand-alone' entities with their own payroll, and their Sub's FEIN (fed tax #) is unique to them. So, it's not hard to taget them precisely, and remove unrelated subsidiaries from the tax.

Secondly, Since these problems surfaced in 2007 and most people involved were removed in 2008 so why NOT exempt "new employees"? Those only begining work in 2008 were not involved, there's no need need (or valid reason) to punish them. We also maintain these TARP companies' ability to attract and retain good people to help undo this mess and minimize our losses. That's to our benefit - the taxpayers (who now own about 80% of AIG and have substantial investments in other TARP companies.)

I'd be pleased if they stopped there.

But you could go on to target and expand the 'punishment' to the 'guilty':

1. Pull in all companies receiving TARP funds, even if indirect. I.e., those companies who got TARP funds from another TARP company would be subject to the tax.

2. If you're gonna make taxes retroactive, why stop at 2008?

Make it retrocative much further back and 'confiscate' Cassanno's bonuses (he's the villian in AIG) received before he was fired. I'm not in favor of confiscatory taxes, nor retroactive changes, but if Congress is going to do it, they damn well oughtta do it right.

(I still think lawsuits are the right way to go. I'd really be pleased if they dropped this stupid tax idea and pursued those. At least that way we'd have assurance that they guilty ones were punished, the government wouldn't have to look like the bad guy in breaking contracts and conficating innocent peoples' money, and wouldn't be setting a bad precedent and may avoid costly legal challenges to the 90% tax law.

Fern

 

[LumbergTech]

Originally posted by: JohnnyGage

Originally posted by: scruffypup
You can see by the replies to Fern's post that many people don't understand the tax bill about to be passed or Fern's post,...

This is not about AIG,... it is about dozens of companies that are not AIG, that will be effected wrongfully because of congress and Obama, who wrote the bill and signed the bill respectively to allow for bonuses to be paid, these contracts if not paid would have ended up as lawsuits and AIG would have then had to pay anyways, Congress and Obama are now writing and going to sign a bill that goes after AIG, but also other companies retroactively and in my opinion wrongfully, not to say it is scary and almost an abuse of powers that the founding fathers would be fuming over and probably would be getting ready for a revolution,... yet we are going to let it happen.

This is very much an example:
Let's say a company (not AIG) took 5 billion in funds just to ensure they would be solid throughout the downturn and pressure on finanicial institutions,... but would have been ok most likely otherwise,... has employees whose income is pretty much all bonus based,... those employees who did nothing wrong working for a company that did nothing wrong are now subject to a ridiculous tax by congress stripping them of most of their income

Sorry but I think what Congress is doing (not to mention what they have already done) is the most outrageous of any group.

This.

they should give the money back if the restrictions would hurt them

im not supporting the tax, but i don't think the money was intended for people to be able to hedge their bets, it was to bail out those who were completely screwed.

 

[Fern]

Originally posted by: LumbergTech
-snip-
they should give the money back if the restrictions would hurt them

That's a 'catch-22' for now.

Originally, they basically agreed to keep the TARP for 3 years. But that's before a slew of 'new strings' were added.

(AS you can see from below) The rules requiring that you replace TARP funds with private equity (not likley in current conditions) was recinded, however you still need permission to return the funds before the expiration of the 3 year period.

From what I can find, that's not expected to happen until 2010.

While returning the TARP funds would exempt a company and it's employees from the 90% tax, looks like they won't be able to even if they wanted.

TARP appears that it might be the federal government's version of The Hotel California: you can check in, but you can never check out.

Lawmakers removed one obstacle last week by eliminating a requirement that firms raise a corresponding amount of private capital before repaying Troubled Asset Relief Program funds. But other issues remain.

Under the law, bankers must first consult with their federal regulators before repaying money, and observers say winning approval is likely to be tough in the current environment. Regulators want banks to have more capital right now ? not less.

"They have to prove to their regulators they are financially sound without Tarp, and given how conservative regulators are these days, that's not going to be the easiest thing," said Kip Weissman, a partner at Luse Gorman Pomerenk & Schick PC.

The Obama administration opposed the provision in the economic stimulus, arguing that it would undermine the law's goals. Also, the law does say the Treasury Department must first write regulations outlining how bankers may repay Tarp ? and it would not be the first time an administration delayed writing rules it did not support.

"Some banks have already said they want to repay the government ASAP," an administration official said on the condition of anonymity. "This could have the unintended consequence of firms choosing not to participate in ways that would be helpful to getting credit flowing, including homeowners, auto loans, and small businesses."

Allowing some institutions to repay Tarp funds early could create problems for the companies that do not.

For example, if JPMorgan Chase paid back its money early, but Citigroup Inc. and Bank of America Corp. did not, that could create more problems for those two firms.

"For those that can afford to buy back, does that mean you are healthy?" asked Lisa Andrews, a special counsel at Kelley Drye & Warren LLP.

"What does that mean for those that can't?"

The Treasury may also make bankers wait until regulators complete their stress tests of the largest institutions.

LINK

Fern

 

[Cattlegod]

I'll do the job for a multimillion dollar bonus taxed at 90%.

 

[smack Down]

Originally posted by: Fern

Originally posted by: LumbergTech
-snip-
they should give the money back if the restrictions would hurt them

That's a 'catch-22' for now.

Originally, they basically agreed to keep the TARP for 3 years. But that's before a slew of 'new strings' were added.

(AS you can see from below) The rules requiring that you replace TARP funds with private equity (not likley in current conditions) was recinded, however you still need permission to return the funds before the expiration of the 3 year period.

From what I can find, that's not expected to happen until 2010.

While returning the TARP funds would exempt a company and it's employees from the 90% tax, looks like they won't be able to even if they wanted.

TARP appears that it might be the federal government's version of The Hotel California: you can check in, but you can never check out.

Lawmakers removed one obstacle last week by eliminating a requirement that firms raise a corresponding amount of private capital before repaying Troubled Asset Relief Program funds. But other issues remain.

Under the law, bankers must first consult with their federal regulators before repaying money, and observers say winning approval is likely to be tough in the current environment. Regulators want banks to have more capital right now ? not less.

"They have to prove to their regulators they are financially sound without Tarp, and given how conservative regulators are these days, that's not going to be the easiest thing," said Kip Weissman, a partner at Luse Gorman Pomerenk & Schick PC.

The Obama administration opposed the provision in the economic stimulus, arguing that it would undermine the law's goals. Also, the law does say the Treasury Department must first write regulations outlining how bankers may repay Tarp ? and it would not be the first time an administration delayed writing rules it did not support.

"Some banks have already said they want to repay the government ASAP," an administration official said on the condition of anonymity. "This could have the unintended consequence of firms choosing not to participate in ways that would be helpful to getting credit flowing, including homeowners, auto loans, and small businesses."

Allowing some institutions to repay Tarp funds early could create problems for the companies that do not.

For example, if JPMorgan Chase paid back its money early, but Citigroup Inc. and Bank of America Corp. did not, that could create more problems for those two firms.

"For those that can afford to buy back, does that mean you are healthy?" asked Lisa Andrews, a special counsel at Kelley Drye & Warren LLP.

"What does that mean for those that can't?"

The Treasury may also make bankers wait until regulators complete their stress tests of the largest institutions.

LINK

Fern

If they didn't like the terms why did they accept the money in the first place.

 

[sciwizam]

Originally posted by: smack Down

Originally posted by: Fern

Originally posted by: LumbergTech
-snip-
they should give the money back if the restrictions would hurt them

That's a 'catch-22' for now.

Originally, they basically agreed to keep the TARP for 3 years. But that's before a slew of 'new strings' were added.

(AS you can see from below) The rules requiring that you replace TARP funds with private equity (not likley in current conditions) was recinded, however you still need permission to return the funds before the expiration of the 3 year period.

From what I can find, that's not expected to happen until 2010.

While returning the TARP funds would exempt a company and it's employees from the 90% tax, looks like they won't be able to even if they wanted.

TARP appears that it might be the federal government's version of The Hotel California: you can check in, but you can never check out.

Lawmakers removed one obstacle last week by eliminating a requirement that firms raise a corresponding amount of private capital before repaying Troubled Asset Relief Program funds. But other issues remain.

Under the law, bankers must first consult with their federal regulators before repaying money, and observers say winning approval is likely to be tough in the current environment. Regulators want banks to have more capital right now ? not less.

"They have to prove to their regulators they are financially sound without Tarp, and given how conservative regulators are these days, that's not going to be the easiest thing," said Kip Weissman, a partner at Luse Gorman Pomerenk & Schick PC.

The Obama administration opposed the provision in the economic stimulus, arguing that it would undermine the law's goals. Also, the law does say the Treasury Department must first write regulations outlining how bankers may repay Tarp ? and it would not be the first time an administration delayed writing rules it did not support.

"Some banks have already said they want to repay the government ASAP," an administration official said on the condition of anonymity. "This could have the unintended consequence of firms choosing not to participate in ways that would be helpful to getting credit flowing, including homeowners, auto loans, and small businesses."

Allowing some institutions to repay Tarp funds early could create problems for the companies that do not.

For example, if JPMorgan Chase paid back its money early, but Citigroup Inc. and Bank of America Corp. did not, that could create more problems for those two firms.

"For those that can afford to buy back, does that mean you are healthy?" asked Lisa Andrews, a special counsel at Kelley Drye & Warren LLP.

"What does that mean for those that can't?"

The Treasury may also make bankers wait until regulators complete their stress tests of the largest institutions.

LINK

Fern

If they didn't like the terms why did they accept the money in the first place.

Terms are being updated with each passing week.

 

[Fern]

Originally posted by: Cattlegod
I'll do the job for a multimillion dollar bonus taxed at 90%.

Then you're precisely the type of person who shouldn't get such a job

Federal income tax at 90%
NYS income tax at 6.85%
New York city tax at 3.65
Medcare tax at 1.45

That's about 102%

It's a money loser. Most will be better off by just giving it back. Especially when one considers the itemized deduction and other phase-outs that would result from the increased (bonus) income on the tax return.

Fern

 

[smack Down]

Originally posted by: sciwizam

Originally posted by: smack Down

Originally posted by: Fern

Originally posted by: LumbergTech
-snip-
they should give the money back if the restrictions would hurt them

That's a 'catch-22' for now.

Originally, they basically agreed to keep the TARP for 3 years. But that's before a slew of 'new strings' were added.

(AS you can see from below) The rules requiring that you replace TARP funds with private equity (not likley in current conditions) was recinded, however you still need permission to return the funds before the expiration of the 3 year period.

From what I can find, that's not expected to happen until 2010.

While returning the TARP funds would exempt a company and it's employees from the 90% tax, looks like they won't be able to even if they wanted.

TARP appears that it might be the federal government's version of The Hotel California: you can check in, but you can never check out.

Lawmakers removed one obstacle last week by eliminating a requirement that firms raise a corresponding amount of private capital before repaying Troubled Asset Relief Program funds. But other issues remain.

Under the law, bankers must first consult with their federal regulators before repaying money, and observers say winning approval is likely to be tough in the current environment. Regulators want banks to have more capital right now ? not less.

"They have to prove to their regulators they are financially sound without Tarp, and given how conservative regulators are these days, that's not going to be the easiest thing," said Kip Weissman, a partner at Luse Gorman Pomerenk & Schick PC.

The Obama administration opposed the provision in the economic stimulus, arguing that it would undermine the law's goals. Also, the law does say the Treasury Department must first write regulations outlining how bankers may repay Tarp ? and it would not be the first time an administration delayed writing rules it did not support.

"Some banks have already said they want to repay the government ASAP," an administration official said on the condition of anonymity. "This could have the unintended consequence of firms choosing not to participate in ways that would be helpful to getting credit flowing, including homeowners, auto loans, and small businesses."

Allowing some institutions to repay Tarp funds early could create problems for the companies that do not.

For example, if JPMorgan Chase paid back its money early, but Citigroup Inc. and Bank of America Corp. did not, that could create more problems for those two firms.

"For those that can afford to buy back, does that mean you are healthy?" asked Lisa Andrews, a special counsel at Kelley Drye & Warren LLP.

"What does that mean for those that can't?"

The Treasury may also make bankers wait until regulators complete their stress tests of the largest institutions.

LINK

Fern

If they didn't like the terms why did they accept the money in the first place.

Terms are being updated with each passing week.

Banks invented the idea that terms are subject to change with out notice.

 

[BoberFett]

Originally posted by: smack Down

Banks invented the idea that terms are subject to change with out notice.

LOL, too true.

 

[brencat]

This is disgrace that people can actually approve of the govt ex-post facto taking away a bonus that was negotiated in good faith during a time when the company, in AIG's case was solvent.

Do you think Goldman and JPMorgan's top traders and analysts are going to stand for working for $250k after they've been accustomed to a $600k - $1mm+ lifestyle? Puleeease. Just the thought of being capped out will have them running for the door at the first instance.

Like Fern said, this will impact departments and trading desks that had nothing to do with a particular company taking/needing TARP money. And despite what some of you believe, most of you would never survive the attitudes, hazing, stress, and "you're only as good as your last idea" mentality that comes with a trading desk job on a 24/7 basis.

Most people on Wall St, even up at the SVP level are lucky to take home a $150 - $175k base salary. The majority of their pay is in the end of year bonus. This is incredibly useful for a company since they have the ability to pay nothing in a bad year -- in other words, they value the huge flexibility that low fixed costs (low salaries) affords them.

This situation with AIG, attempting to take away no-cut, guaranteed-minimum bonuses which are commonplace on Wall St for top performers and have been for decades is communism, and likely illegal if it went to trial. If I was guaranteed $6.4 million, I'd say GFY and see you in court. A contract is a contract -- the company took their chances on these people by signing these contracts, and that's how it always is.

 

[3chordcharlie]

Originally posted by: brencat
This is disgrace that people can actually approve of the govt ex-post facto taking away a bonus that was negotiated in good faith during a time when the company, in AIG's case was solvent.

Do you think Goldman and JPMorgan's top traders and analysts are going to stand for working for $250k after they've been accustomed to a $600k - $1mm+ lifestyle? Puleeease. Just the thought of being capped out will have them running for the door at the first instance.

Like Fern said, this will impact departments and trading desks that had nothing to do with a particular company taking/needing TARP money. And despite what some of you believe, most of you would never survive the attitudes, hazing, stress, and "you're only as good as your last idea" mentality that comes with a trading desk job on a 24/7 basis.

Most people on Wall St, even up at the SVP level are lucky to take home a $150 - $175k base salary. The majority of their pay is in the end of year bonus. This is incredibly useful for a company since they have the ability to pay nothing in a bad year -- in other words, they value the huge flexibility that low fixed costs (low salaries) affords them.

This situation with AIG, attempting to take away no-cut, guaranteed-minimum bonuses which are commonplace on Wall St for top performers and have been for decades is communism, and likely illegal if it went to trial. If I was guaranteed $6.4 million, I'd say GFY and see you in court. A contract is a contract -- the company took their chances on these people by signing these contracts, and that's how it always is.

I don't disagree that one contract is as valid as another, but either the bonuses are to control costs in bad years or they aren't - it's hard to imagine there's been a worse year than this one, and all these 'bonuses' are guaranteed!

 

[brencat]

Originally posted by: 3chordcharlie
I don't disagree that one contract is as valid as another, but either the bonuses are to control costs in bad years or they aren't - it's hard to imagine there's been a worse year than this one, and all these 'bonuses' are guaranteed!

Like I said, the company takes its chances signing a minimum pay clause and that's the way it is and has been for top performers.

Remember that the $250k pay cap is for FAMILY income. So what if your spouse is an attorney making $300k per year and you are a trader at JPMorgan, a firm that took TARP money. So, that means if you make $150k base + $400k bonus, the govt will confiscate 90% of your family income above $250k?? WTF.

Another example, one of my coworkers neighbors was an attorney and is retiring this year with a multi million retirement package. Her spouse works for a TARP recipient as a trader. And they are worried about 90% of her retirement package being confiscated -- how do you reconcile this??

In both cases, the govt is punishing your spouse in the process. That is communism, actually might be fascism, pure & simple. I hope Barack and the Senate come to their senses.

 

[StageLeft]

Based on Fern's post I would agree that, yes, this is a good example of how the legislation had had [we assume] unintended consequences.

 

[GTKeeper]

I find this thread hilarious.

First of all, AIG is free to give the TARP money back anytime they want.

Second, if you think they are 'experts' at running a financial institution, look at their track record. They know about as much as a fifth grader.

Thirdly, I think this is the least of their worries. I know that there are lawsuits in the pipeline representing the 2 biggest US pension funds that were lied to by AIG and sold AAA securities when, in fact, they were garbage.

AIG is nothing but a gambling institutions. They issued naked CDSs and now are paying for it. I don't understand all the whining from AIG.

 

[brencat]

Originally posted by: GTKeeper
I find this thread hilarious.

First of all, AIG is free to give the TARP money back anytime they want.

Second, if you think they are 'experts' at running a financial institution, look at their track record. They know about as much as a fifth grader.

This goes waaaaay beyond AIG. This is about the govt seizing ex-post facto legitimately earned family income over $250k from people who's spouses / providers just happened to be unlucky enough to work for a TARP recipient. It's wrong on so many levels, and if you can't see this, then you need your head examined.

 

[GTKeeper]

Originally posted by: brencat

Originally posted by: GTKeeper
I find this thread hilarious.

First of all, AIG is free to give the TARP money back anytime they want.

Second, if you think they are 'experts' at running a financial institution, look at their track record. They know about as much as a fifth grader.

This goes waaaaay beyond AIG. This is about the govt seizing ex-post facto legitimately earned family income over $250k from people who's spouses / providers just happened to be unlucky enough to work for a TARP recipient. It's wrong on so many levels, and if you can't see this, then you need your head examined.

I would have an issue if AIG was a privately funded institution. It is not at this point, so basically the gov't can do WHATEVER it wants. I would have an issue if the gov't went to Microsoft and did this though.