it is the same issue of corporate governance on both sides of the ocean. the board of directors rubber stamps management decisions. the interest of shareholders and management are not in sync. look at GM, for years upper management got high salaries while making sweetheart deals with big unions. then bankruptcy and bailouts by the public.
(UK) Bankers face 10-year delay on bonuses
- Thread starter sheda
- Start date
it is the same issue of corporate governance on both sides of the ocean. the board of directors rubber stamps management decisions. the interest of shareholders and management are not in sync. look at GM, for years upper management got high salaries while making sweetheart deals with big unions. then bankruptcy and bailouts by the public.
This is a great idea.
Bankers and traders are great at maximizing their own comp. 10 years puts them inline with the shareholders, whose money they are using.
The system has no incentive to change without outside intervention because everyone in the command chain is optimizing 1-3 year payouts.
We need more "long term greedy"
Bankers and traders are great at maximizing their own comp. 10 years puts them inline with the shareholders, whose money they are using.
The system has no incentive to change without outside intervention because everyone in the command chain is optimizing 1-3 year payouts.
We need more "long term greedy"
I think I understand his point but if someone is going to go psycho trader they still have the ability to do it, just because the motivation of a bonus is out of the way does not stop the unlikely event of some capitalist hating eco warrior prepared to put in the time then do the time for bringing down a bank.
So while we see headlines such as "London 'risk takers' to be hit by EU bank bonus cap" with the intent of capping bonus to that of salary amounts we now also see the intent to stop them from getting it for a decade. What banker would be attracted to europe, fuck them, we say, just dont go mentioning another tool of mass financial saftey around here, things like the ftt happen to have personal impact :lol:.
because most of the time these size risks cannot be put on without complicity by many many people. It takes years and hundreds of approvals (explicit or tacit) to get the risk on to be this devastating.
Quote from piezoe:
How about drawing clear lines between commercial and investment banking? Oh wait, that was tried and there wasn't as much money to be made!
seems like this should be the very the first step.
but since the bankers buy the politicians in the US we wind up with dodge bank - I mean dodd and frank.