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View Poll Results: Do the AIG employees deserve a $165 million in bonuses?
Of course, they worked hard for the money 20 19.23%
Heck no, those bonuses are my hard earned tax dollars. 84 80.77%
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Old 03-16-2009, 12:42 PM   #21
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There are probably profitable sectors, divisions, and departments in AIG that have managers, execs and employees that deserve compensation greater than their base compensation.

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They don't deserve a penny more than AIG could afford to pay them without the bailout money.
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Old 03-16-2009, 01:06 PM   #22
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Bonus or bone us?
Either way, it's time for cutbacks! And no severence pay, either!
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Old 03-16-2009, 02:43 PM   #23
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I voted no but if these folks have a contract that grants them a bonus and they do what it takes to get the $, who can fault them for taking the money? Which of you would turn down a bonus of any kind? Not me.

Perhaps the Qs that should be asked are : Who approved the bonuses? Why did the US Govt not make this (no bonus) part of the TARP?
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Old 03-16-2009, 03:01 PM   #24
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It seems to me that other than a turnaround situation (e.g. a new management team takes over GM), no profits= no bonus. In AIG cases no government bailout would have lead to bankruptcy, and the bankruptcy judge would have certainly had the option to toss the bonus out the window. Now I'll admit my knowledge of bankruptcy laws is minimal and British contract laws non-existent.

So for those you urging a not enough information option, I doubt unless you were a Barrister, it would be that helpful to have more info.

Anyway, I was trying to make a lopsided poll . This is an anti-populist group so I guess I am not surprised to see 15% or so vote for the bonus. BTW, I think the most lopsided poll on the forum in recent times "was do you carry a credit card balance".
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Old 03-16-2009, 03:09 PM   #25
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This is an anti-populist group
Not sure what this means. Should I feel good about myself or ashamed?
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Old 03-16-2009, 03:25 PM   #26
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It seems to me that other than a turnaround situation (e.g. a new management team takes over GM), no profits= no bonus. In AIG cases no government bailout would have lead to bankruptcy, and the bankruptcy judge would have certainly had the option to toss the bonus out the window. Now I'll admit my knowledge of bankruptcy laws is minimal and British contract laws non-existent.

So for those you urging a not enough information option, I doubt unless you were a Barrister, it would be that helpful to have more info.
Well said.
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Old 03-16-2009, 03:49 PM   #27
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If the word "deserve" means "legally entitled to", then I think the answer is yes.

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AIG chairman Edward M. Liddy informed the Treasury Department Saturday that the company was contractually obligated to pay the bonuses by a Sunday deadline, based on agreements concluded in early 2008. The firm, which lost nearly $62 billion in the last quarter of 2008, said it would try to reduce further bonuses to be paid in 2009. The payments due yesterday were part of overall promised bonuses totaling more than $400 million for 2008 and 2009.
washingtonpost.com

(The bonuses causing all the stir are in the Financial Products division, which is where all the problems are concentrated. Apparantly people knew the wheels were coming off in early 2008 and the company did "stay bonuses" to keep them around for a while.)

If "deserve" means "morally entitled to", then my answer is no. Not only did they screw things up, work for a division that lost huge sums of money, but they also wouldn't be getting the money if the gov't had let the company go into bankruptcy.

The same is true for most of the CDS counter-parties. They took their chances on AIG's financial strength, they only "deserve" the money legally because we're bailing them out. They certainly don't "deserve" it morally. The counter-parties are getting billions, the employees are getting millions.
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Old 03-16-2009, 04:01 PM   #28
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The same is true for most of the CDS counter-parties. They took their chances on AIG's financial strength, they only "deserve" the money legally because we're bailing them out. They certainly don't "deserve" it morally.
But wasn't the risk to AIG's counter-parties a major portion of the systemic risk that made the bailout necessary in the first place?
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Old 03-16-2009, 05:29 PM   #29
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Not sure what this means. Should I feel good about myself or ashamed?
I am not sure that Anti-populism is word, but it should be. I think of Gregory Peck as the lawyer in To Kill a Mocking Bird standing up to the populist lynch mob. So if you see think being compared to Atticus Finch is good thing...

I happen to think the bonus shouldn't be paid, but I can't argue to much with those saying, laws and contracts need to be respected regardless of what the politicians and press are screaming.
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Old 03-16-2009, 08:00 PM   #30
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If AIG is to remain a going concern, they need to have the tools to retain and recruit successful people.
My guess is that there are plenty of currently unemployed people who would be more than happy to step in if the AIG employees are unsatisfied.

I say don't pay the bonuses and let them litigate. Do you think any of them will ever again have a future in this industry if they do? Heck, if I were AIG's board, I would not only refuse to pay the bonuses, I would sue the executives for what they already received, on a "theft of services" theory. (if for no other reason than to improve my leverage).
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Old 03-16-2009, 08:17 PM   #31
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My guess is that there are plenty of currently unemployed people who would be more than happy to step in if the AIG employees are unsatisfied.
Do the unemployed people to whom you refer know how to unwind derivative trades involving toxic assets? If they don't, who knows how much money they will lose trying to do this. They might lose more than the bonuses involved.
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Old 03-16-2009, 08:21 PM   #32
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Do the unemployed people to whom you refer know how to unwind derivative trades involving toxic assets? If they don't, who knows how much money they will lose trying to do this. They might lose more than the bonuses involved.
I bet at least some of them do. It has been a bloodbath on Wall Street and there are many qualified people looking for jobs.
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Old 03-16-2009, 08:22 PM   #33
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My guess is that there are plenty of currently unemployed people who would be more than happy to step in if the AIG employees are unsatisfied.
You right, you right. Heck, why even pay them? I saw an article on CNN about attorneys who are out of work doing pro bono just to keep up their skills and pad the ole resume. You could probably pick some of them up cheap or free.

I'm sure high level financial execs are fungible commodities and any ole warm body could fill their roles.
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Old 03-16-2009, 08:26 PM   #34
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I bet at least some of them do. It has been a bloodbath on Wall Street and there are many qualified people looking for jobs.
Well, as a taxpayer to the US govt who owns much of AIG, I am all for cutting labor costs. You may be on to something here. Maybe we should fire all the highly paid folks and then put those jobs out to bid. Low bidder on salary figures gets the job. That'll cut those costs right to the bone.

I'll put in my bid for only $249,000 for any upper level CEO position.
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Old 03-16-2009, 08:26 PM   #35
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Do you really think the guys at AIG are the only ones who can do that work?
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Old 03-16-2009, 08:29 PM   #36
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Heck I say hire the 2 year old from the E-Trade commercials. Unlike stocks, derivatives trading is a zero sum game. The folks in AIG financial products group have proven themselves to either very unlucky or very bad in the aggregate. Now some maybe good but it indisputable that as group the people at AIG were on the wrong side of many trades over the last year. As involuntary shareholder of AIG, I say fire the group and hire the folks that beat them last year.

This guys are in the insurance business and they sold insurance premiums way too cheaply. I think what is worse is they destroyed AIG reputation. As Buffett says.
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Old 03-16-2009, 08:32 PM   #37
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I bet at least some of them do. It has been a bloodbath on Wall Street and there are many qualified people looking for jobs.
Perhaps there are some who could come up to speed in time. But they are currently not familiar with AIG's book of business, so there is money lost in the time that it takes them to come up to speed. I'm sure that is why these folks were payed retention bonuses in the first place. They were deemed necessary for the ongoing book of business.

Sort of like replacing a lawyer in the middle of a case. The replacement attorney may be qualified, but there still may be an opportunity cost to the client while he comes up to speed with the case.
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Old 03-16-2009, 08:35 PM   #38
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As involuntary shareholder of AIG, I say fire the group and hire the folks that beat them last year.
I doubt there are many Goldman Sachs derivative traders who would want jobs at AIG.
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Old 03-16-2009, 08:47 PM   #39
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Hey, these people are lucky to have jobs the way things are out there. I got a bonus for them, my 13EEE.
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Old 03-16-2009, 10:14 PM   #40
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Personally, my Megacorp never hesitated to change the rules whenever it worked out better for them. Off with their heads, says I!
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