Princely Sums

January 31, 2009

(fixes typo in third paragraph)

MARKETS-STOCKS/Talk about the end of the salad days. The White House is pledging action against “irresponsible” bonuses for executives at bailed-out Wall Street companies and Senator Claire McCaskill has proposed a law to cap their compensation to $400,000 a year.OBAMA/

Masters of Wall Street should not make more money than the president of the United States, she argues, at least not until they wean themselves from government aid. So what’s a Wall Street executive to do on only $400,000 a year? Here are some ideas – precluding paying rent, buying food, putting gas in the car or getting the poodle a trim:

MADOFF/REAL ESTATE: Thank goodness the property market crash has opened some affordability gaps for the newly upper-middle-class executive. The prospective banking executive could pick up a one bedroom, one bathroom co-op condo on West 45th street, or see if she could get a mortgage on Bernard Madoff’s Montauk $3.3 million East Hampton estate. In this market? Unlikely. Plus, agents will tell you the market price is actually much higher. Pity.

OFFICE OR HOME DECORATION: He could spend a year’s salary on four painted portraits of billionaire investor Warren Buffet. In May, performance artist Michael Israel painted a portrait of the head of Berkshire Hathaway in 10 minutes flat. Six months later, a Minneapolis executive bought it for $100,000 in an eBay auction, with the proceeds going to the non-profit Girls Inc program.

USA STONE CRABPARTY PARTY PARTY: The future titan of Wall Street may not be able to afford Rod Stewart, who played at Steve Schwarzman’s big birthday bash in 2007 for $1 million, but he could gorge on 10,000 or so of the Blackstone chief’s favorite crab claws, which were going for $40 per claw back in the heyday of high finance.

SUPERBOWL: StubHub had a Super Bowl luxury suite going for $83,340, so a bank exec could still easily play the part of overpaid sports junky and still have more than $300,000 to lose on the outcome of the game. If he wants to be a bit more frugal, club premium seats are going for $10,511 a pop. If ego demanded, he could afford 4 seconds of TV advertising.

USA/GETTING OUT OF DODGE: The cost of operating the private jet fleets, while difficult to estimate, could still be managed by the bank exec of tomorrow. NetJets Inc, owned by Warren Buffett’s Berkshire Hathaway, was selling fractional ownership shares of private planes for a minimum of $406,250 back in December, so that’s out, but through Marquis Jet, it is possible to purchase 25-hour increments of time in NetJet planes for $115,900, or roughly $4,600 an hour. Virgin Galactic was offering tickets to space for $200,000 in 2006 through Park Avenue travel, but like the plan to cut Wall Street executive pay, space travel is just an idea at this point.DAVOS-FORUM/

MAKING IT BACK: Lloyd Blankfein, CEO of Goldman Sachs, earned more than $68 million in 2007. At $400k it would take him 170 years to get back to the good old days.

OTHER AFFAIRS: Spitzerish peccadilloes? Shoe collections? A few fine bottles of wine? How would you deal with a crummy $400,000 day job on Wall Street?

13 comments so far | RSS Comments RSS

There always seems to be a back-lash after severe events. If a bank takes government money bonuses should be capped.
Brian Marchant-Calsyn


If a company received government money, it should be thankful to have avoided bankruptcy. Would the execs have received bonuses if their company went bankrupt?

Posted by Ge | Report as abusive

It is a pity that the author of this article has not understood that what the executives of Wall street had done was simply stealing tax payers’ money by paying themselves 18 billion dollars as bonuses.

Posted by Jean Michel Wong | Report as abusive

Spot the next asset price bubble before all the other nouveau pauvre executives do….

Posted by Ian Kemmish | Report as abusive

We have let this happen for so many years now, so all these decades has it gone unnoticed? no, because everyone is making they let it go. Politicians are no never sincere in their efforts they always play along the wind and the game, if there is a problem they make some one scapegoat if not they make money. I Pity a average person like us who is the looser 90% of the time, that 10% is the chance when we vote.


“Pitty” you don’t know how to spell properly. Perhaps your job should be done with someone with actual writing talent for a change.

Posted by Grammar Knight | Report as abusive

Wall Streeters like Citigroup who use shareholder and government funds to send their executives on vacation need to have their wings clipped! It is simple stealing from shareholders and the public, the fact that it is legal does not make it right. Wall Street needs to live by the same rules as the rest of American business which means payment for services rendered, not looting and pillaging.

Our bankruptcy laws need to be changed to prevent the execs who take a company into bankruptcy from being there when it emerges.

Posted by Marc Asch | Report as abusive

I had no idea corporate jets were that spendy. Seems like a lot of money just to avoid sitting next to someone. Am I missing something?

Posted by Josef | Report as abusive

you may gamble with your own money and receive a large amount for the risk

Your salary to gamble with tax payers money is not a risk for you
and no salary should be higher than the President’s salary


Score! I suppose there will be more executive jobs in the US for us newly minted MBAs after the seasoned talent leaves for more lucrative lands.

Posted by InatBooth | Report as abusive

I doubt the Princes keep all the bonus. Some must go to bribe pension fund managers to invest 401k savings in AAAjunk, and fund election of politicians who sell taxpayers into slavery.

Posted by Survivor? | Report as abusive

what people don’t realize is the money Wall St. played with for years was never their “own” money. I was yours and mine, in stocks, in managed funds, in credit. Soooo….there was NEVER a time they gambled with their “own” money.

Posted by clark tierney | Report as abusive

Bonuses are completely discretionary—conditioned upon the performance of the firm as a whole.
Bonuses are not warranted at all for any firm getting government aid.
How many jobs would the $18 billion have saved?

Posted by ex-banker | Report as abusive

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