Goldman Sachs bonus blowout; $23 billion: Enough to pay for healthcare for 1.7 mil families

[debbierlus]

http://rawstory.com/2009/10/goldman-sachs-2009-bonuses-to-double-2008s-23-billion-could-buy-115-million-iphones-or-send-460000-to-harvard

Yesterday, we brought you the insurance company that wouldn't insure a 17-pound infant because he was too heavy. Today, we bring you the investment bank that manages to double its bonuses during the worst recession since the Great Depression.

On Thursday, Goldman Sachs will announce the firm's bonus payments for 2009. Analysts expect the bonus pool to mushroom to $23 billion -- double the bonus pool paid to employees in 2008. Earlier this year, Goldman Sachs said that it had put aside $11.4 billion for bonuses during the first half of the year.

“The absolute size of compensation payouts will rise significantly,” Keith Horowitz, an analyst at Citigroup, wrote in a note to clients two weeks ago, highlighted by Andrew Sorkin in The New York Times' dealbook column Tuesday.

How much is $23,000,000,000?

For one thing, it's enough to send 460,000 full paying students to Harvard University for one year, or 115,000 for four years.

It's enough to pay the health insurance premium for the average American family ($13,375) 1.7 million times.

It's enough to upgrade 191 million computers to Windows 7 operating system (priced at $119.99), or to buy 115 million iPhones at $199.99 (provided the recipient was willing to sign a two-year contract).

Or, apparently, it's enough to reward the employees of Goldman Sachs for a bonanza trading year, at a firm where average employee compensation was recently $622,000 -- and likely to be greater this year.


The $23 billion figure could leave some American taxpayers woozy -- the US government bailed out Goldman Sachs with a multi-billion payment last year, which the firm has since repaid.

But while Goldman is likely to pay its biggest bonuses ever to employees, the firm pays very little in taxes worldwide. In 2008, the company was said to have paid just $14 million in taxes worldwide, and paid $6 billion in 2007.

The firm's corporate tax rate? About 1 percent. According a prominent tax lawyer, “They have taken steps to ensure that a lot of their income is earned in lower-tax jurisdictions.”

Sorkin says Goldman's CEO is trying to hold off criticism by making a big charitable donation.

"Now there’s talk inside Goldman that it is considering making a huge charitable donation — perhaps more than $1 billion — as a way to help deflect the criticism," Sorkin says. "Such a donation would be a welcome gesture that would no doubt benefit many needy organizations. But it would most likely be seen for what it is: a one-time move to draw attention away from where most of the money is really going. A large charitable donation also raises questions about the company’s fiduciary duty to its shareholders; it could be seen as giving away profits that ostensibly belong to them."

http://rawstory.com/2009/10/goldman-sachs-2009-bonuses-to-double-2008s-23-billion-could-buy-115-million-iphones-or-send-460000-to-harvard

[Kermitt Gribble]

1. Reaping the benefits of campaign contributions? n/t

[debbierlus]

4. Not to mention their Golden Boy, Geithner at the helm as treasury secretary

[FiveGoodMen]

2. !

:puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke: :puke:

[SammyWinstonJack]

7. +1 nt

[debbierlus]

11. I feel the exact same way.

[debbierlus]

12. I feel the exact same way.

[Democrats_win]

3. They will make a nice target when people get really desperate.

[bertman]

10. Not really, Democrats_win, they'll be tele-commuting or chilling at their summer home(s).

[Vinnie From Indy]

5. "All animals are equal, but some animals are more equal than others",

That is twenty three THOUSAND million dollars. They could give 23,000 Goldman employees a million each.
How many people work at Goldman?
What do the janitors make at that company?

All Americans that are not working for Goldman should feel violated.

[girl gone mad]

31. What do they make??

Complicated financial products that bring down global economies.

Totally worth it.

[LuckyLib]

6. Criminals without an ounce of morality. The whole damned lot.

[debbierlus]

23. And, they just had their 'best year EVER'....

Crime pays so well!

[BolivarianHero]

8. The social credit movement may have been loony right...

But they were quite right about hanging bankers.

[Joanne98]

9. A giant vampire suid sucking on the face of humanity

[AusDem]

43. being picky here, but technically that thing

is a kraken. :D

[Initech]

13. Urge to kill......... rising!

[Soylent Brice]

14. that's beyond fucked up.

[PassingFair]

15. kick

Enough! How long can we be ripped off like this?

[JDPriestly]

16. Charitable donations are the means through which rich people

exert influence and control and, as a "bonus" get lots of credit for being good people, which they often are not. Why don't they just pay their taxes like everyone else.

Charity should be the result of feelings of love and compassion, not a public relations stunt. But wealthy foundations and rich individuals have made it into a means of increasing their importance and status in the world -- their control.

[debbierlus]

21. It is a pittance compared to what they steal, and it is ONLY for show

[debbierlus]

17. I should add that it would pay for millions more if the health insurnance leeches were excised

as the parasites they are...

[Hannah Bell]

18. "The firm's corporate tax rate? About 1 percent."

This is why the economy's in crisis.

[debbierlus]

19. It is amazing, isn't it? If you or I held up a store or bank, we would go to jail for a looong time

Buy the White House access and you can pillage the entire country's treasury with no ramifications.

Surreal.

[LuckyLib]

25. This is the informations that needs to be out there. Each and every day.

Memo to the American people:

Goldman Sachs bonuses -- billions. Tax rate -- 1 percent.

[AllentownJake]

20. Well when your ex CEO becomes the Treasury Secretary

and turns a blind eye to you destroying your two biggest competitors with naked shorts, than hands you $13 billion dollars you are owed from a bankrupt company at the expense of the American Taxpayer, than you buy the top economic advisers in the next White House, you tend to have a good year.

[debbierlus]

22. Cheers

:thumbsup:

[change_notfinetuning]

24. So what? When Obama says it's a problem, then it's a problem.

I don't recall him saying in the campaign that the rich shouldn't get richer.

Higher taxes on the rich, the top few percent? Don't know what you're talking about.

[hobbit709]

26. Since these clowns think they are Bourbons and Romanovs

Maybe they need to learn the fate that befell those privileged classes in 1789 and 1917

[kenny blankenship]

27. Celebrate yourself America! after all, YOU'RE paying for it.

Through the multiple bailouts of AIG, in case some dumbfuck wants to know.

Why is Goldman allowed to game the system?

Here are four questions we should be asking regulators:

1. Why is Goldman Sachs allowed to maintain leverage ratios significantly higher than the large legacy bank holding companies like Wells Fargo, Bank of America, JPMorgan and Citigroup?
2. Why is Goldman allowed to operate like a private equity company, holding large stakes of foreign non-financial corporations? (I should note that Financial Holding Companies do have ten years in which to sell their stakes)
3. Why is Goldman (and other large banks) allowed to operate like a hedge fund and take outsized risks with capital via large proprietary trading operations. Most of Goldman’s profits are coming from this area. At least Deutsche Bank has offloaded these bets onto hedge funds in which it invests. Given the fact that the large too-bog-to-fail financial institutions have received a large backstop from the taxpayer, the fact that they are loading up in prop trading shows that regulation in the U.S. is non-existent.
4. Why is Goldman allowed to have an interest in the failure of other financial firms? We now hear that Goldman has an interest in the failure of CIT, a major lender to small-and medium-sized businesses. These perverse incentives are everywhere in the derivatives world and were an enabler of the financial meltdown and the principal reason AIG was bailed out with taxpayer money.

Clearly, regulators are not serious about regulating or they would correct these problems. MarketWatch reported on this as far back as July and nothing has happened.

After two quarters as a bank holding company, Goldman is still “not reporting like a bank and not acting like one either,” said David Hendler, Baylor Lancaster, Pri de Silva and Kristine Lanspa, analysts at CreditSights, an independent fixed-income research firm.

Given Goldman’s spectacular results so far this year, “the company has basically been given a green light to continue operating in a ‘business as usual’ fashion,” they wrote in a note to investors after Goldman’s latest earnings report. “Bank regulators have their hands full with other deteriorating bank situations and, for the time being, seem content to let Goldman do what it’s always done.”

[WinkyDink]

28. I've long lamented the demise of the guillotine.

[rhett o rick]

29. Time to bring it back. Just make sure your hands have callouses. nt

[Overseas]

30. Goldman Sachs gives $23 billion in bonuses but only pays a tax rate of 1%

And their veterans are running our treasury. What a sad state of affairs.

And they're going to try a charitable donation to offset the criticism? The really sad part about that is that they probably would take that from the profits left after bonuses were paid and not reduce the obscene bonus totals at all, and then maybe take a deduction from their 1% corporate taxes too.

[debbierlus]

36. Criminals...

[Egalitariat]

37. The $23 Billion is an expense to GS that lowers it's taxable income

The employees who receive the $23 billion will pay taxes on it to NYC, NY State, and the US Treasury. Probably about $7 billion worth of taxes.

Edited to correct Subject.

[Truth2Tell]

46. Not a chance.

There is no way in hell that those bonuses will generate anything close to $7 billion in tax revenue. Not a chance. The recipients of that money will shelter a large part of it from much taxation. Count on it. If we were talking about wage earners here, then yes, we'd see 7 bil in tax revenue. These guys? In your dreams.

[Egalitariat]

47. The won't shelter it nearly as much as GS would had they not distributed it and kept it as profit

If the article is true, and GS effective tax rate is 1%, then GS would only pay about $230 million in taxes if it held onto the money. I guarantee you the recipients of the bonuses pay alot more than $230 million in taxes on it.

[Greyhound]

41. Well, if they were not running the Treasury and Fed they couldn't get the $23B, now could they? n/t

[QC]

32. THANK GOD IT PASSED!!!

[Greyhound]

39. Beat me to it...

:thumbsup:

[QC]

33. Where's Madame Defarge when you need her? n/t

[Lucky Luciano]

34. WIsh I worked at Goldman!

With roughly 30K employees, it comes out to roughly $750K per employee...of course the partners and senior partners get considerably more since their is a large skew in divinding up the winnings - but even beign a junior schmuck is a good thing there as long as you are front office!

[Liberal_in_LA]

35. wow!

[Egalitariat]

38. I bet Hugo Chavez would know how to solve that one

Maybe President Obama should seek his advice. And follow it.

[Greyhound]

40. So which is worse, a parasite that acts like a parasite,

or the person that has the capability to kill the parasite yet doesn't?

[debbierlus]

45. The leeches are human beings, they have the choice to act morally

The insurance companies don't have to act this way. They choose to do so because money is the most important thing to them.

The politicians and corporations are symbiotic and both share equal blame.

[slipslidingaway]

42. Memo to Investigators: Dig Deep (Page 2) By William Greider

http://www.thenation.com/doc/20091026/greider/2

"...Here are some promising targets for investigators:

Collusion in High Places. Some Wall Street players suspect that certain bailouts engineered by the Treasury and the Federal Reserve (including Treasury Secretary Timothy Geithner, former head of the New York Fed) were motivated by a logic never revealed to the public. The suspicion goes like this: the strange and costly rescue of AIG, an insurance company facing bankruptcy, was really intended to save Goldman Sachs, the premier investment house. If AIG went down, it would threaten Goldman and other big holders of AIG's collapsing derivative contracts. Goldman CEO Lloyd Blankfein participated in the pre-bailout discussions, an oddity revealed by Gretchen Morgenson of the New York Times. Afterward, Goldman got paid off in full with the public's money--$12.9 billion to erase its exposure..."


See TFC thread here...

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=6769019&mesg_id=6769019

[Vidar]

44. K&R

[Orwellian_Ghost]

48. Bump

[debbierlus]

49. Geithner needs to be fired. Bernacke needs to be denied confirmation

And, whole criminal cabal needs to be investigate and tried for mass FRAUD.

Then, once convicted, they should be sent to the same hardcore prisons that they fund through the private industrial prison complex.