What most average people don't understand is that in the "Wall Street world", bonuses are different than in the "Average Joe's world". They are not ONLY for a job well done. They are a contractual part of the normal compensation. Only the SIZE of the bonus is determined by the results of the job.
For most of these guys, they are only paid a small percentage of their annual salary as regular income. This is done for the ease of bookkeeping and tax reporting. The "bonus" portion is actually more like a 1099 that an Average Joe independent contractor gets. Kind of like a plumber on a large hotel project.
The regular income for these guys is usually only around $300K to $400K per year, and the balance is paid all at once at the end of the year.
Another thing that most people don't understand is that these AIG Traders are used to getting much more. The AIG guys that got $1 Million bonuses are used to getting more like $10 Million or $20 Million bonuses. So this is a serious reduction in their income.
And the last thing is that these guys worked the desks during the toughest time in AIG's history. Over the last year, some of these guys were in the office 9 or 10 hours a day! There is no 9 to 5 on Wall Street, especially when the financial markets of the world are collapsing. They even had to come in on the weekends, especially on the weekends before each of the bailouts. They had to get all their papers photocopied and three-hole punched.
So if you find yourself wishing they would just commit some sort of Asian suicide ritual, just remember, they have mothers and fathers, sons and daughters, just like you do. And their families count on them for the money they need to go on vacation every month, just like yours do.
And lastly, remember that there are two sides to every story. There is the truth that you are told, and then there is the truth that someone else might tell you. So don't always judge a story based on only one truth. An honest day's pay for an honest day's work, right? That's what it's all about. And look how they worked. They were practically penned up like children in a Chinese sweat shop. How can you put a price on that? And how can you put a price on the humiliation they have suffered for the past six months? How about cutting these guys some slack? After all, it's not like they destroyed the world or anything.
Click to enlarge
(Photo is not actually AIG in order to protect the innocent)
FLASHBACK (October 7)