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Citi Joins The Cost-Cutting Ranks By Slashing Bonuses Up To 70%

Tyler Durden's picture




 

Bloomberg's Trish Regan (yes, she is no longer at CNBC), has just announced that the bank which earlier announced it is shutting down its catastrophic prop trading desk (at which point shreholders let out a sigh of relief), has proceeded with slashing banker pay by 30% for overall comp and some bonuses by as much as 70%. This follows earlier announcements by Bank of America and Morgan Stanley which earlier said they would limit cash bonuses to $150K for senior positions. At the end of the day, the biggest losers are secondary, non-financial New York jobs (supposedly there are some: rat exterminators; strippers; limo drivers; food spitters also known as waiters?) as each banker jobs indirectly supports up to 3 downstream jobs. In other words between layoffs and comp cutting, the immediate impact will likely be to leave New York City, which is the farthest point on the economic procyclical receiving end, with hundreds of thousands of layoffs. Which incidentally, to the bizarro crazy scientists at the BLS, means that initial claims are about to go negative (with the traditional upward revision in the following week).

A chart showing average salaries in NYC for financial professionals and "all other"

And while bankers are general reviled, the truth is that in NY they are largely responsible for keeping the city cranking. From the most recent report on banker comp by the NYC comptroller:

The securities industry is critically important to the economies and budgets of New York State and New York City. It now seems likely that profits will decline sharply from last year’s level, job losses will grow, and cash bonuses will be smaller. Such developments would have a ripple effect through the rest of the local economy and hinder the recovery. In addition, tax collections are likely to fall short of expectations for this year and next year, complicating already tough fiscal situations for New York State and New York City

And why every banker job is reponsible for at least three other jobs:

OSC estimates that each job created (or lost) in the securities industry leads to the creation (or loss) of almost two additional jobs in other industries in the City. (The large income losses during the crisis have slightly reduced the value of the multiplier compared with earlier estimates.) OSC also estimates that each new Wall Street job creates one additional job elsewhere in New York State, mostly in the City’s suburbs. Based on these multipliers and the current level of Wall Street employment, 1 in 8 jobs in the City and 1 in 13 jobs in the State are linked (directly or indirectly) to the securities industry.

Below is full most recent report.

 

 

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Fri, 01/27/2012 - 18:11 | 2104038 HelluvaEngineer
HelluvaEngineer's picture

All their greatest talent is going to leave and work at...

Fri, 01/27/2012 - 18:13 | 2104041 williambanzai7
williambanzai7's picture

Blogspot.com

Fri, 01/27/2012 - 18:13 | 2104042 Sofa King
Sofa King's picture

I think a little pee just came out.

Fri, 01/27/2012 - 18:43 | 2104125 Badabing
Badabing's picture
Citi Joins The Cost-Cutting Ranks By Slashing Bonuses Up To 70%

and put into compensation packages.

Fixed it!

Fri, 01/27/2012 - 20:08 | 2104346 Stax Edwards
Stax Edwards's picture

OT:

This interview of David Stockman by Moyer is an absolutely eloquent and accurate description of where we find ourselves today.  Anyone can understand this description of what we now call free markets and captialism.

It warrants its own post TD, post it up and lets discuss.  We have got to attack this beast head on sooner than later.  Spread the word, the message is resonating as we the people flounder with no job opportunities and underemployment.  Time to get active in our communities and spread the word.  If we don't act it will continue ad nauseum.

http://www.commondreams.org/video/2012/01/21

Note at 42:25 it is stated that Glass Steagall was 34 pages and Dodd-Frank is 2300 pages.  Hmmm.  Who benefits from this complexity?  Hint: It is not small enterprises.

Fri, 01/27/2012 - 20:42 | 2104493 BidnessMan
BidnessMan's picture

My auditor sends in a pre-audit checklist.  One of the questions was "Do you comply with all laws and regulations".  I laughed and asked if he had finished reading all the 40,000 rules and regulations that reportedly went into effect on January 1, 2012 yet.  Just lunacy.  Everyone in the US violates some law or regulation every day.  Just by the grace of God that some regulator or law enforcement officer from any number of state, local, regulatory, and/or federal agency does not bust you every day.  Complexity just sets everyone up to be busted at any time for any number of "violations".  

Fri, 01/27/2012 - 21:02 | 2104556 Cdad
Cdad's picture

Correct.  And that is the reason Fascist American politicians write those bills the way they do.  So they can haul you in any time they like.

Hey...I'm gettin' sumpin' here...FEMA camps?

Fri, 01/27/2012 - 18:29 | 2104081 Zero Govt
Zero Govt's picture

it'll have to be another unproductive commission-cutter job where you mis-manage risk to roll in bonuses and go bankrupt when all the rotten deals pile up as bwankers aren't good for much (anything productive)

maybe the diabolical insurance or pension industries or some other mandated by Law business forced down societies throats like healthcare (they're all absolute shitholes)

CNBC is another outlet for useless people (the blubbering Joe Kernan is driving me fuking nuts with his inane guff)

Fri, 01/27/2012 - 18:38 | 2104110 Cdad
Cdad's picture

Turn it off!  Turn the BlowHorn [CNBC] off!  I am here to testify...the quality of your life will improve the moment you do.  

Fri, 01/27/2012 - 20:23 | 2104428 breakyoself
breakyoself's picture

Joe Kernan is annoying as hell and it took me a few times of watching to figure it out. I haven't watched that segment of CNBC in a long time. Joe irks me like that Varney guy on Fox.

Sat, 01/28/2012 - 07:09 | 2105232 HD
HD's picture

What is sad, is that Joe is an educated man and at one time a good journalist (well, talking head at least). Now he is nothing more than an ideological zealot - who can no longer be objective (at least not on air) and just parrots talking points.  CNBC lost its heart when Mark Haines died - I don't watch CNBC anymore (happy to be off the treadmill) except when I have no other choice. I think the late Mr. Haines would be spinning in his grave to know Cramer is on SOTS.

 

 

Sat, 01/28/2012 - 22:15 | 2106384 Papasmurf
Papasmurf's picture

The last sane person left cnbs some time ago.

http://www.youtube.com/watch?v=79HLnTPxMho

 

Fri, 01/27/2012 - 18:45 | 2104127 Money never sleeps
Money never sleeps's picture

Absolutely fantastic interview of Kyle Bass.  Great example of what's we're all up against - statists, statist-protecting media, etc. http://bit.ly/ywzqNI

Fri, 01/27/2012 - 20:13 | 2104382 Stax Edwards
Stax Edwards's picture

Can we get a chart showing finance industry pay overlaid with .gov debt expansion?  You mean there is a high correlation here? No, say it aint so.

Fri, 01/27/2012 - 19:22 | 2104223 slaughterer
slaughterer's picture

I work for Deutsche Bank.  It sucks here.  We are losing tons of money.  Can I work for Zero Hedge or Banzai?  

Fri, 01/27/2012 - 19:55 | 2104325 HelluvaEngineer
HelluvaEngineer's picture

Have you considered farming?

Fri, 01/27/2012 - 22:56 | 2104777 ZeroPower
ZeroPower's picture

Actually? What office?

Staying on topic, friend over at Credit Ag (HK) confirmed hes getting a 1/5 of base bonus this year. Pretty horrible out there, specially at the french banks.

Sat, 01/28/2012 - 13:51 | 2105592 Sheriff Douchen...
Sheriff Douchenik from AZ's picture

(cont'd) work at...the RIAA or MPAA.

Sat, 01/28/2012 - 20:31 | 2106188 emunah73
emunah73's picture

...JPM Morgan Chase, unless they will start fire too. But I guess they will be the last and now they still have some openings.

Fri, 01/27/2012 - 18:14 | 2104043 Seasmoke
Seasmoke's picture

dick trickle down

Fri, 01/27/2012 - 18:17 | 2104050 Cdad
Cdad's picture

Now that is a pinch of "recovery" that Cdad can believe in.

MOAR....MOAR financial services pink slips, please.

Fri, 01/27/2012 - 18:20 | 2104058 fuu
fuu's picture

Banksters getting the Nerf bat again!

Fri, 01/27/2012 - 18:20 | 2104059 NuYawkFrankie
NuYawkFrankie's picture

Let them eat poppadoms

Fri, 01/27/2012 - 20:23 | 2104427 lotsoffun
lotsoffun's picture

really.  we outsourced all the jobs to them, and at the same time, exported them in to us.  you think they gonna give you a crumb?  they grabbing it all up .  i think they are called 'brahmins'.  i'm a panties man myself.

 

Fri, 01/27/2012 - 18:21 | 2104062 tao400
tao400's picture

Things are really bad, a lot, lot worse than is apparent. Before Christmas I met with my property manager in Atlanta who manages 8 million square feet to pay the office rent. My tower is like 100k square feet. He told me that things are worse now, with more companies going bankrupt, than they were in the bottom of 2009. I promptly walked down the hallway and sold almost all my stocks and kept selling into the rally. Now with Bernanke keeping rates low to 2014, it is now openly admitted how bad things are. In fact, it is actually very scary. Fortunately, I have some gold and stock pile a little food. I keep remembering that movie Too Big to Fail where William Hurt as Paulson says to his wife, "we were a week away from no milk on the shelves." Time to take a bunch of cash out of the bank and bury it somewhere just to be sure.

Fri, 01/27/2012 - 18:36 | 2104101 Cdad
Cdad's picture

Oh come now tao400 you crazy, nutbag prepper.  What's wrong?

Stocks are jumping like unicorns at a special Wall Street rodeo, and there is no inflation because Ben Bernanke is on the job...and Congress is a writin' and a passin' bills left and right, and look...no more debt ceiling problem.  President Zero is covering the bill on Health Care, and corporate taxes are so low that corporations...well, they aren't really paying any these days.

And all around the world, bills are being easily covered by central bankers printing money and handing it out to all the banks, so the unemployment thing is really no problem at all because...who needs to work anyway?  And didn't you hear...Greece is fixed!  Why it is so fixed, European cental bankers have told us it is fixed 23 times now.

And oil is...errr...never mind.  And corn is....well....look how much the shiny metal is worth?  Yer rich, I say!

So gather up the skittles that are falling from the sunshine sky, and grab up some pixie dust while yer at it, 'cause it is practically free!  

We're all fine.  And anyway, if me and President Zero and Ben Bernanke are all wrong [pfffft], you don't even need to worry anyway because there is plenty of room down at your local FEMA camp.  Three hots and a cot for all!

Sat, 01/28/2012 - 00:13 | 2104899 UP Forester
UP Forester's picture

A better movie is Rollover (1981).

 

Except the Saudis are now derivatives.

Fri, 01/27/2012 - 18:28 | 2104083 navy62802
navy62802's picture

::shock::

They still get a fucking bonus? Why? For ruining the US financial industry?? Not only should they not be giving out bonuses, they should have their base pay cut. It is sick that we are shocked at a 70% reduction in BONUS. I'd be shocked by a 70% reduction in base pay. I'm actually still in shock that they are giving out tax-payer funded bonuses.

Fri, 01/27/2012 - 18:51 | 2104147 NotApplicable
NotApplicable's picture

I'm in shock that anyone expects criminals to behave differently.

Fri, 01/27/2012 - 19:11 | 2104203 YC2
YC2's picture

the bonus is where it hurts, especially as you go up the ranks. base pay is meh in comparison

Fri, 01/27/2012 - 19:18 | 2104214 Conman
Conman's picture

You are insane. Meh meaning still over 200k which is a lot to msot people when the average salry in the us is ~20k.

Fri, 01/27/2012 - 19:30 | 2104239 navy62802
navy62802's picture

Assuming a base pay of 200k, a 70% reduction would put them at 60k which is still well above the average salary. Obviously, the bonus is where it hurts. Hahaha.

Tue, 02/07/2012 - 17:05 | 2135367 YC2
YC2's picture

"in comparison."

Fri, 01/27/2012 - 19:18 | 2104215 knukles
knukles's picture

Hahhahahaha
That's probably what they're thinkin'...

          .... Oh fuck meh

Fri, 01/27/2012 - 20:20 | 2104413 lotsoffun
lotsoffun's picture

how do you like your ipod? made by workers at 70 cents an hour.  makes you feel good?  you really are much smarter than those coolies.  you DESERVE it.  oh - poor steve jobs and his liver transplant.  karma is a bitch.  it really is.  now i can listen to music 25/8 and groove and groove.  can't wait to buy into the facebook ipo.

 

 

Tue, 02/07/2012 - 17:14 | 2135414 YC2
YC2's picture

I dont work at a bank, I just know how the comp works, jeez.

Sat, 01/28/2012 - 13:42 | 2105548 Bam_Man
Bam_Man's picture

Yes, that $250-300k base pay doesn't buy a whole lot of fois gras and Bollinger Grande Année these days. And now that the Chinese have discovered Grand Cru Burgundy and First Growth Bordeaux, the bankers will be trading down to Mondavi. Oh, the humanity!

Fri, 01/27/2012 - 18:34 | 2104097 Racer
Racer's picture

As a reminder, every financial service job in New York indirectly is responsible for 3 downstream non-financial jobs"

yes, that is true, among them are:

Unemployment officer

BLS unemployment data 'adjustment' officer

Food stamp distribution officer

Fri, 01/27/2012 - 19:43 | 2104277 pine_marten
pine_marten's picture

Saddist goon jailor should be in there too.

Sat, 01/28/2012 - 19:58 | 2106161 sun tzu
sun tzu's picture

RACIST

Fri, 01/27/2012 - 18:36 | 2104102 dwdollar
dwdollar's picture

Too little, too late. Won't stop public anger one bit.

Fri, 01/27/2012 - 18:37 | 2104104 Problem Is
Problem Is's picture

Life's a bitch...

Your bankster pay gets cut 70% and the plebs and gomers still want to go medieval on your ass...

Fri, 01/27/2012 - 18:40 | 2104114 wonderatitall
wonderatitall's picture

this is just terrible. poor shumucker the yapper will have to do what every democrat does  now, steal. i myself am glad that obamanomics is coming to ny the 2nd most disgusting city ,behind che'cago. this is what i have always wished. that the rich bastards stop patronizing these swineherd business and that democrat ny dies a horrible puss filled death...

 

on the bright side , TRISH REGAN IS HOT.  tear down this blue wall of oppression mr obamachev and let a stupid repub have a chance to fuck shit up!!!

ps- DID I MENTION THAT TRISH REGAN IS HOT

 

Fri, 01/27/2012 - 19:07 | 2104187 11b40
11b40's picture

The degree that this country is screwed is like compounding interest.  It matters not which "PARTY" holds power over government.  Neither one has control over our final fate anymore than they can control a hurricane heading for shore.  The laws of nature nor the laws of math will be subjugated by mere mortals.

By the way, however, it was Bush the Lesser who pushed the snowball over the summit and started it rolling downhill.  It could have been stopped 10 years ago, but the course has now been set, and it will be run.

Sat, 01/28/2012 - 03:46 | 2105103 StychoKiller
StychoKiller's picture

Meh, THIS IS HOT:  http://www.karinahart.com/

Fri, 01/27/2012 - 18:44 | 2104126 fonzannoon
fonzannoon's picture

The banks gave these guys huge salary increases a few years ago. They did that in lieu of bonuses. So now when they "slash" bonuses it looks these these guys are paying the piper when they are still smoking the piper.

Fri, 01/27/2012 - 18:45 | 2104128 resurger
resurger's picture

Have you seen this Video of this guy?!

http://www.youtube.com/watch?v=ehWrbBiPxOk

Jo Granville Dow to plunge

Fri, 01/27/2012 - 19:21 | 2104219 slaughterer
slaughterer's picture

I buried Joe Granville in the bear cemetery a few days ago.  Forget about him.  

Sun, 01/29/2012 - 08:10 | 2106987 resurger
resurger's picture

Sure! am so bearish on stocks like never before ...

when i see my self losing money on my shorts, i know that more suckers are coming in, hope you are not one of them!

 

Fri, 01/27/2012 - 18:49 | 2104135 Poetic injustice
Poetic injustice's picture

After those news, hooker industry is next to have worse numbers, lower pay and longer.
They may ask for bailout money to keep jobs, or maybe Obama bill will support their jobs so they are not exported to Asia.

Fri, 01/27/2012 - 18:49 | 2104136 meatball
meatball's picture

When they win, they get big bonuses; when they lose, they get bailed out and still get paid more than 99% of the country. Nice work if you can get it.

Fri, 01/27/2012 - 18:57 | 2104155 resurger
resurger's picture

Yeah! That explains the Private elevator that our Mangers and CEO's have in our bank... which is activated by a private access card!

 

Fri, 01/27/2012 - 18:50 | 2104138 11b40
11b40's picture

That chart makes it pretty clear who the masters of the universe are, and why our society is so badly damaged.  Did I hear someone say class warfare? 

Never have so many been so easily defeated by so few as in America circa 1980-2012.  They gave us the rope; we hung ourselves.

Fri, 01/27/2012 - 18:56 | 2104154 Things that go bump
Things that go bump's picture

Good strippers can find work anywhere. 

Sat, 01/28/2012 - 00:16 | 2104901 UP Forester
UP Forester's picture

Yeah.  Old, fat, ugly and bad strippers, with C-section scars, end up outside the gate of an Army base.

Sat, 01/28/2012 - 02:32 | 2105050 Things that go bump
Things that go bump's picture

Yes, and those poor boys are grateful. 

Fri, 01/27/2012 - 18:57 | 2104158 Rainman
Rainman's picture

They'll get 2 envelopes. One is a skimped check. The other is the letter they must sign saying they will never  tell the truth, the whole truth and nothing but the truth.

Fri, 01/27/2012 - 19:05 | 2104179 Bunga Bunga
Bunga Bunga's picture

... and escort services are getting a lot cheaper :)

Sat, 01/28/2012 - 00:17 | 2104903 UP Forester
UP Forester's picture

Even cheaper using Gropeon!

Fri, 01/27/2012 - 19:27 | 2104232 bugs_
bugs_'s picture

they still get to keep 30% of their taxpayer subsidized bonus.

Fri, 01/27/2012 - 19:34 | 2104246 pine_marten
pine_marten's picture

Short on diamond studded anal pull toys.............

Fri, 01/27/2012 - 19:57 | 2104332 Reese Bobby
Reese Bobby's picture

This entire discussion is stupid.  Most of you people can't distinguish legitimate forms of finance from the government sanctioned stealing type.

Are you all too fuckin lazy to even watch Inside Job?

Could you ever consider what a fair fee might be for raising a company capital, or managing assets?  They might be too high currently.  But underwriting and investment advisory is a free bid-ask market.

ZH has turned into a site for losers and whiners.  I'm really gonna try to quit this time.  It is just so addicting...and every time I'm about to cut the cord, "Tyler" posts something brilliant.  You're nothing but a crack dealer to financial nerds.  HELP!

 

 

Fri, 01/27/2012 - 21:19 | 2104593 Cabreado
Cabreado's picture

Just a thought...

Use your time here to educate, rather than bitch and moan.

Said sincerely.

Education of the slumbering masses is Priority Uno.

If you are addicted, it is likely related to Truth, and as we unwind, others will find their way here and places related, looking for the same.

 

Sat, 01/28/2012 - 12:23 | 2105430 Reese Bobby
Reese Bobby's picture

Fair point.  Thanks.  I have been off the rails lately.

Fri, 01/27/2012 - 23:00 | 2104793 ZeroPower
ZeroPower's picture

Posts are fine. The comments one must be weary of; such as mine, and all above and below it.

Sat, 01/28/2012 - 06:03 | 2105203 Surly Bear
Surly Bear's picture

+1

Sat, 01/28/2012 - 19:05 | 2106111 dizzyfingers
dizzyfingers's picture

Stay away if you don't like the site.

Fri, 01/27/2012 - 19:59 | 2104334 tony bonn
tony bonn's picture

i was happy to read about the layoffs and bonus cuts - even if they were only of trivial eye wash kind - but not pleased to read about your twisted defense of trickle down economics....

these disgusting banks should be broken up in a spread the risk initiative....

Fri, 01/27/2012 - 20:04 | 2104349 zerotohero
zerotohero's picture

I'm just thankful I have a job - there are seriously sad things happening to families that once were sold on the idea of mass consumption of goods whether they needed them or not and now have nothing.

Sat, 01/28/2012 - 19:04 | 2106107 dizzyfingers
dizzyfingers's picture

It's nice to know at least one other person is thankful, and says so. I think it's important to feel thankful.

Fri, 01/27/2012 - 21:29 | 2104605 disabledvet
disabledvet's picture

I used to work on that prop desk. YOU PHUCKERS OWE ME A 100 MILLION AFTER I BLEW UP RUSSIA IN '98! (Go ahead...get all cheap and see who'll take out Mexico...

Fri, 01/27/2012 - 22:37 | 2104747 rsnoble
rsnoble's picture

So in other words all the fuckheads that are already gazillion millionaires have to lay low until the right moment comes along that they can fuck us again. Anything to stay in power.  Accept no concessions from these assholes, they need expelled from the planet. Permanetely.

Sat, 01/28/2012 - 19:00 | 2106103 dizzyfingers
dizzyfingers's picture

How articulate and succinct you are. Righto. You've got it.

Fri, 01/27/2012 - 23:09 | 2104805 Zer0head
Zer0head's picture

watch Vikram, he is one great guy, a veritable national trasure

http://www.bloomberg.com/video/84929556/

 

Fri, 01/27/2012 - 23:29 | 2104840 Dermasolarapate...
Dermasolarapaterraphatrima's picture

My Yacht! How will I be able to refurbish my already outdated 2010 yacht to keep up with the Bankfines?

Forget that new Mercedes...my high shcool student daughter will look like a fool driving aournd that old 2010 model...

Cutting Bonuses...how vulgar!

Sat, 01/28/2012 - 18:59 | 2106098 dizzyfingers
dizzyfingers's picture

Where are the customers' yachts?

Sat, 01/28/2012 - 02:01 | 2105020 dolph9
dolph9's picture

Fuck all Jew York City bankers.  Useless parasite scum.

Sat, 01/28/2012 - 02:03 | 2105027 Dingleberry
Dingleberry's picture

But what about retaining all that "TALENT" that we hear so much abut????????

Sat, 01/28/2012 - 04:00 | 2105123 StychoKiller
StychoKiller's picture

Talent?  Sucking a golf ball through a garden hose, now THAT'S TALENT!

Sat, 01/28/2012 - 18:56 | 2106096 dizzyfingers
dizzyfingers's picture

eff yourself you dick.

Sat, 01/28/2012 - 07:11 | 2105236 HD
HD's picture

I didn't know Trish was on Bloomberg. Good for her.  I bet she wakes up every morning thrilled she no longer has to kiss Larry Kudlow's ass.

Sat, 01/28/2012 - 13:58 | 2105609 Sheriff Douchen...
Sheriff Douchenik from AZ's picture

I worked on Wall St and watched the 28 year old coke snorter get to the top while I tried to make clients money with legit ideas and got yelled at for it. Cokehead ran up all the expenses, and the brass didn't care cos he got the trades one way or the other. I left the biz. Wall st, etc can choke on it.

Sat, 01/28/2012 - 18:55 | 2106095 dizzyfingers
dizzyfingers's picture

Actually it's like that pretty much everywhere. Shit walks and talks and gets the cash and bennies and the worker bees ...well, they're just overlooked. Best to work for yourself, or at the least, avoid corporations.

Sat, 01/28/2012 - 18:52 | 2106090 dizzyfingers
dizzyfingers's picture

Any thoughts on whether big cities are going to lose population due to the jobs problem? Anyone?

Sat, 01/28/2012 - 19:16 | 2106123 Lucius Corneliu...
Lucius Cornelius Sulla's picture

You'll know its over when Times Square reverts back to peep shows and cheap hookers.  You know, like it was before the finance boom started in the late 80s.  I know because I visited NYC for the first time in the mid-eighties and that's exactly how it was.

Sun, 01/29/2012 - 22:39 | 2108430 Caveman93
Caveman93's picture

Trickle down poverty?

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