Bonuses Slashed :)

Lets also not forget that if they had liability that got marked down in the crunch, they booked that as REVENUE. Meaning that bonuses increase because of the general failure of the market. Of course, when THEIR assets get written down, that doesn't come out of revennue.

Arguments make plenty of sense if you read them correctly...

Take a guess why I'm siding with those whose bonuses are on the line...

"No way no how no bonuses for wallstreet!"

You can't honestly believe this is going to happen do you? Bonuses are looked at like an expense just like the coffee in the office or the car you take home at night....sure they will be down, but you can still count on something as that's just the way it goes....

And here's a dirty little secret....Bloomberg is praying for that to happen else the tax increases / service cuts he introduced earlier this week will look conservative to what will have to happen if income taxes are cut to a trickle...

Aside from the tax revenue argument, which I DON'T have a well thought out solution for. The sensible solution for the banks that have received the Capital injections is the following: Banks allocate bonuses as they see fit, however, that cash is retained (restricted) at the company for 3-5 years and is awarded a return based on the companies ROE (return on equity) over this period of time. This keeps main street happy, keeps congress happy and insures that if the gov't is not paid back, no bonuses are paid. It adds significant financial strength (and liquidity)to the banks balance sheet while reducing leverage at the same time. Employees who believe in the long term strength of their organizations should be happy, if not, screw em!

I'm not saying 0% bonus, (except for the top managements, yes 0 bonuses for them) but anything north of 50% bonus would enrage me. garelj, I know you are not an ibanker. if so probably an anaylst (whose bonuses won't get affected as much anyways) Don't try to fool me, I know too many ibankers to know you don't hold the standard. And your comments DON'T make sense, they are all anally skewed.

Who said anything about being a ibanker...and what is an ibanker standard? There more parts to a Bank than ibankers

But you seem to be infatuated with them...i can tell your from the 90's based on this....

"anally skewed"

Ill leave this one alone as it explains a lot....

"You can't honestly believe this is going to happen do you? Bonuses are looked at like an expense just like the coffee in the office or the car you take home at night"

Ok, so i get it. You work at an ibank - and you're probably right - "ok" bonuses will be paid. Obviously not what you got last year, but probably better than most deserve given huge overall losses. But the catch is this - just because they accrue expenses quarterly does not mean they need to pay it out at year-end. In fact, I'd watch for 4Q earnings for the ibanks. For some, YE is nov and for others dec. Either way, that 4Q is going to have sept and/or oct in there. My guess is that given market performance, abysmal profitability, and heightened political sensitivity that you get meaningful clawbacks to even Q1-Q3 accruals. The risk is that you tick off your "stars" and they threaten to leave. As I've said before - where will they go?

"Bloomberg is praying for that to happen else the tax increases / service cuts he introduced earlier this week will look conservative to what will have to happen if income taxes are cut to a trickle..."

Not necessarily true. NY will get its taxes, either it gets them either as corporate (when they don't pay you that bonus) or personal income (when they do pay you that bonus). It doesn't matter if banks aren't even making money because if they pay you less, their NOL carryforwards are less which is again good for NY revenue.

garelj, if you don't know the definition of ibanker, I don't know why you are even worried about defending your bonus, as it's clear you are not in a vocation that, in normal years, pays you at minimum 150% bonuses over base. Don;t worry you'll get most of your bonus and the difference won't be that big anyways. The rage that people have toward these bonuses are for the wallstreeters who are getting multiple times bonuses over base (which is 2-3 times average salaries already). I worked as an Investment banking Analyst in JPM before joining a family business. Even I, as an Analyst got $75K base with 100-150% bonus each year several years ago. Even as an ex banker, it enrages me to see these bonuse figures this year. It is just deplorable.

And "you" really should try re-reading your comments. It's clear you are near sighted - you can only see a tree but can't seem to take in the forest its in.

"Nothing from tech_guy? Tecchi: don't you have the housemath.us algorithm yet? Because without that we can't decide if it's worth its weight in salt, or gold, right?

Regarding the "opportunity cost" being on your down payment, let's say you have a $100,000 house with an $80,000 mortgage. The house gets destroyed in a flood and you have no insurance. How much have you lost?"

I have a life outside these boards you know :) The algorithm is up at the housemath.us site - you go there and look at it yourself if you want. I'm not going to retype it for you.

As for opportunity cost, natural disaster without insurance? That's the best you can come up with? First of all, its just plain ridiculous (I am insured, both banks and coop boards require it. In condos/homes, I hear the bank pays it for you and charges you monthly for the insurance).

Let me ask you this: A man comes up to you and says "I have $200,000 in cash under my mattress, what's my opportunity cost?". Another man comes up to you and says "I have $200,000 equity in an apartment, what's my opportunity cost?". Until your answer to those 2 men are the same, your answer is wrong. Opportunity cost, by definition, is the amount of money you can earn if you have zero other obligations, and chose purely to maximize investment value.

I don't know why I bother. Go ahead and be wrong.

"NY will get its taxes, either it gets them either as corporate"

Son, the banks wont be paying taxes for the conceivable future...

But I guess you didnt get the memo...

MillA - ibankers are so 90's (like you) as you can tell as you love talking about it...

I work as a "guy" for a private company who doesnt like to publicate what they do nor do they talk about it (a JPM ibanker who made 150% bonuses and get chicks going clubbing drinking red bulls and vodkas showing all the women my suits cause chicks dig suits....did i mention i used to be an ibanker at JPM in the 90's making more than you know...did i mentione im a ex-ibanker)...if you cant figure that out its ok...i'll take a large pizza from that family business of yours....

"The algorithm is up at the housemath.us site - you go there and look at it yourself if you want."

Actually, I've tried, it never comes up. Give me the link. Easy enough.

"As for opportunity cost, natural disaster without insurance?"

LMAO. I specifically picked a flood, because many people don't have flood insurance.

"Opportunity cost, by definition, is the amount of money you can earn if you have zero other obligations, and chose purely to maximize investment value."

No it's not:

http://www.econlib.org/library/Enc/OpportunityCost.html

"When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you cannot spend the money on something else. If your next-best alternative to seeing the movie is reading the book, then the opportunity cost of seeing the movie is the money spent plus the pleasure you forgo by not reading the book."

"This simple concept has powerful implications. It implies, for example, that even when governments subsidize college education, most students still pay more than half of the cost. Take a student who annually pays $4,000 in tuition at a state college. Assume that the government subsidy to the college amounts to $8,000 per student. It looks as if the cost is $12,000 and the student pays less than half. But looks can be deceiving. The true cost is $12,000 plus the income the student forgoes by attending school rather than working."

So your opportunity cost of keeping $200,000 in cash under your mattress is what you could have earned on that $200,000 had you a) bought an apartment; b) bought securities; c) other. If you have $100,000 at risk - whether that money is borrowed or not - then your opportunity cost is what you would have made by investing that $100,000 elsewhere.

You don't know what opportunity cost is. You don't know what imputed rent is. You haven't answered me why it's a good idea to buy an apartment effectively to rent it out to yourself when you wouldn't buy it to rent to an unrelated third party - all benefits (tax) included - and you won't even look up the link for housemath.us which, according to the Encyclopedia of Economics (and everyone else) is the full, levered cost of buying an apartment.

If not, show me where you got your definition of opportunity cost. Besides plucking it out of thin air.

Sorry tech_guy - you lose yet again.

"Son, the banks wont be paying taxes for the conceivable future..."

Not even remotely true. Like I said above, even if they don't pay taxes this year any bonus banks don't pay out will reduce their NOLs. For most of these banks, I'd say they will burn through thos NOLs within the next year or two.

Your link (as always) doesn't support your argument. It doesn't mention loans, mortgages, housing, nothing.

Even still, the definition supports my claim. Your definition says the opportunity cost is the "next-highest-valued alternative". Key word is *alternative*. The highest valued alternative to 200k under my mattress, vs. 200k equity in an apartment, is the same. The first choice is *irrelevant* to what the next best alternative is. Again, unless your answer to the 2 men I mention above is the same, your answer is wrong.

Transaction costs are the only exception. So, to claim that the 2 are different, you're also claiming that the expected returns on the stock market *alternative* vs. landlord real estate *alternative* differ only in transaction costs. That's not a very big difference, over 10 years, and judging by how bearish you are, I doubt you think the difference is that small.

Special_K -

Aug. 12 (Bloomberg) -- Wall Street's mortgage losses have grown so large that some firms may pay little or no taxes for years, widening New York City and state deficits and challenging their ability to provide services, Mayor Michael Bloomberg said.

Some companies are seeking refunds from the city on taxes they paid ahead of time, saying losses have cut their tax liability to zero. The banks pay tax on 110 percent of earnings in advance as a ``safe harbor,'' protecting against penalties for underpayment.

``It will be a number of years before Wall Street starts paying taxes again,'' the mayor said at a press conference yesterday in Manhattan. ``They will carry forward all of those losses.''

I'll go with the facts but why should you because making up facts are so much more fun!

This will be my last post on the matter, since I know between digging yourself too deep into an incorrect argument, and twisting facts to support your bearish claims, you'll never give in. You'll just go on tangent #1000 instead of facing reality.

I start with $200,000 invested in what I think is optimal - stocks and bonds. I know it earns a historical 8% in the very long term. That's equivalent to $1,333/month of income from my $200k. If I consider buying an apartment, my rent vs. buy math includes a $1,333 monthly *cost*, because I give that up by using 200k on a down payment. That's what an opportunity cost is.

You claim my opportunity cost is $6,667 - 8% on 1 mil. Despite owning a 1M home, I never had the *opportunity* to put 1 mil in the stock market at 8%. My home is worth 1 mil, I have a liability that high, but no opportunity cost that high.

Claiming flood damage will put me out the full 1 mil is like claiming buying crappy used car for $2000 cash has a 10 mil opportunity cost, because I might run over someone and cripple them, costing 10mil in medical costs over their lifetime. That's a potential liability, not an opportunity cost.

Now go on being wrong - I know you will - but I've stopped caring. The respect you earned from prior conversations (which is why I bothered this long) has long since gone away.

"I'll go with the facts but why should you because making up facts are so much more fun! "

So a few comments by Bloomberg on the eve of him calling for budget cuts and higher taxes is your version of facts? Are you kidding me? Everyone knows that we are going to be hit hard on tax revenues. Your point was that the NY gov't wants wall street to pay out bonuses to get tax revenue on personal income. That's silly. But as I can see from your other posts, you don't really understand a lot about finance. You want some facts? Here's is 2008E GAAP net income (which is a close proxy to net income for tax purposes):
Goldman: $5.1bn
Morgan Stanley: $4.5bn
Bank of America: $8.3bn
Merrill: -$12.7bn (will be taxpayer in 2009/10 pending BofA acquisition)
Deutsche Bank: $2.3bn
Citi: -$11.6bn (will be taxpayer in 2010)
Credit Suisse: -$1.1bn (will be taxpayer in 2009)
JP Morgan: $6.6bn

Has profitability been hit? Absolutely. And therefore tax revenues will be hit. But many of these guys are still taxpayers and those that are not, will be soon. Furthermore, not all of the GAAP write-downs/losses are deductible for tax purposes so these GAAP earnings likely overstate any estimation of NOL carryforwards.

"Your link (as always) doesn't support your argument. It doesn't mention loans, mortgages, housing, nothing."

It specifically does mention loans - student loans - and subsidies. Housing vs. any other good makes no difference for the argument. Opportunity cost IS opportunity cost. You need to learn that.

"Despite owning a 1M home, I never had the *opportunity* to put 1 mil in the stock market at 8%."

You are partially correct.

Say you buy a stock with a 50% margin on $200,000. You can borrow $400,000, making your total investment $600,000. You then have total income of $4,000 a month. If the stock price goes up you can borrow even more, so that eventually you have the opportunity not only of investing $1 million, but more. You can bail at any time you like, and the interest is fully deductible.

Your $800,000 mortgage loan will cost you $5,593.72 a month. Of that, in the first year, about $5,000 a month is deductible interest. Let's say you have a blended tax rate of 30% - it gives you a tax savings of $1,500 a month, fully levered. Without the leverage you earn by your own calculation your $200,000 investment earns you $1,300 a month. With leverage it earns you $4,000 a month.

So your tax savings is $0 without leverage on the stock market, and negative $2,700 a month with leverage. Without leverage the risk premium is much lower than the risk premium on a mortgage loan, since leverage of any sort increases risks. When you adjust for that factor, your "tax savings" is even lower.

So there goes your argument.

"That's a potential liability, not an opportunity cost."

Let me clarify what I meant - your opportunity cost is calculated on the total amount owed, not on the amount you put into it. If you lose $1 million on a home that's the bet you placed, whether on your credit card or a mortgage or a HELOC. To claim that the basis of the opportunity cost is the down payment ignores the risks.

Sorry, but you're wrong on all accounts. Owner-occupied residential real estate is a capitalized expense, not an asset.

On another note:

"`They will carry forward all of those losses."

And so will mutual funds and ordinary people.

"Claiming flood damage will put me out the full 1 mil is like claiming buying crappy used car for $2000 cash has a 10 mil opportunity cost, because I might run over someone and cripple them, costing 10mil in medical costs over their lifetime. That's a potential liability, not an opportunity cost."

No, its not. The situation you are in includes leverage. You owe someone that amount, period. No "might". If you asset hold up in value, you should be able to pay back what is owed.

But as soon as you take the mortgage, you are on the hook for that.

And, levered 5 to 1, you only need a 20% decline in the price for you to have lost 100% of your investment.

That is leverage for you. Increased gains (sometimes substantially) and increases losses (also sometimes substantially).

garelj, again you jump to conclusions. I worked as an Analyst out of school for couple of years but never did any you've mentioned. For one, I'm a woman and 2ndly don't drink. another thing, our multi million $ "family" business don't sell pizza - although we do order every other day here on our floor. Furthermore, I was not bragging - one needs a face/name to match, to brag how great ones life is, it's not sth that can be done online anonymously. I was merely stating the fact that I'm in the know.

Since you are still in denial that you should receive those outrageous bonuses, I'll direct you to the following article. Perhaps it'll help you dream about the bonus jackpot.
http://www.bloomberg.com/apps/news?pid=20601039&sid=aKAH9t4l3dnw&refer=home

Excerpt "Bonus Jackpot Can Be Yours in Five Easy Steps" by Michael Lewis. (Nov. 10, Bloomberg)

It may still take awhile before Wall Street finally accepts that it won't get paid. At the moment, as their bony fingers fondle the new taxpayer loot, the firms appear to believe they might still fool the public into thinking that bonus money isn't taxpayer money..(According to) Citigroup spokeswoman "..we confirmed that we will not use TARP funds for compensation...(but) She declined to elaborate."
As well she might! For if the Citigroup spokeswoman had elaborated she would have said something like this: "We're still trying to figure out how the $25 bn we've taken of taxpayers' money has nothing to do with the $26 bn we're planning to hand out to our highly paid employees in 2008 (up 4% from 2007!). But it's a tricky problem because, when you think about it, it's all the same money."
Sadly, the public is now poised to see through any ruse: This pile of money instead of that pile, stock instead of cash, options instead of stock, options on options instead of options - none of it is going to fool anyone anymore...

No Secrets:
Just how wised-up the public has become was recently illustrated in a letter sent to Treasury Secretary Henry Paulson from Leo Gerard, President of the United Steelworkers Union. The steelworkers' boss, deploying the Black-Scholes model with élan ("Mr. Secretary, this analysis is not rocket science") correctly priced the securities bought by the U.S. Treasury in 9 Wall Street firms, and thus revealed to all the extraordinary deal Paulson had just given his old pals at Goldman Sachs.
Of the $10 billion the Treasury handed Goldman Sachs, $5 billion counted as a fairly priced investment. The other $5 billion was...free money. "It would appear," Gerard wrote, "you intend to reward the institutions that have driven our nation, and it now appears the whole world, into its most serious economic crisis in 75 years, with a gift of $350 billion from the American taxpayers, who have watched 760,000 jobs disappear over just the past nine months." If even the steelworkers union can parse the Wall Street doublespeak, the doublespeak has lost its power to persuade. Too many people know too many things. The problem of how to get paid on Wall Street must be radically reframed.

Think Again:
If you are one of those people currently sitting inside a big Wall Street firm praying for some kind of bonus (garelj!) it may already have dawned on you that you need to rethink your approach. It's no longer any use to hint darkly that they had better fork over serious sticks or you'll bolt for Morgan
Stanley. There's no point even in thinking up clever ways to make profits for your firm: who cares how much money you bring into Goldman Sachs if the U.S. Congress doesn't allow Goldman Sachs to pay bonuses?
The moment your firm accepted taxpayer money, you lost control of your money machine. To reclaim it will require patience, teamwork and an action plan with at least five artful steps. To wit:
Step 1: Publicly renounce all material ambition.
...As soon as possible your CEO must rise in public and say: "For as long as we have taxpayer money we will pay no bonuses! Let no one in our bank speak ever again of being robbed! Even if the government offered us more pay, we would decline it, as it insults the interests of both the public and the company." ...

Lips Sealed:
Step 2: Do nothing. Say nothing. Wait.
You will be treated like a man who ...announced he was going on a hunger strike...You'll need to skinny up before anyone believes you're a threat to yourself. Go without bonuses...and people will begin to take you seriously. And one day - trust me - they'll begin to worry about your health.

Step 3: Do as little as possible to generate profits for the firm.
For most traders this shouldn't be too difficult - remember, you no longer eat what you kill. For investment bankers lassitude will not come so naturally. Accustomed to seeing your life as one giant Min-Max problem, you may be overcome by a lack of structure...

Shared Sacrifice
Step 4: Having established your noble indifference to money, demand similar sacrifices of others.
Eliminate your dividend, with a gusto that sends your share price plummeting. For an ordinary bank, in ordinary times that would be a problem, but these are no ordinary times and you are no ordinary bank. You are a bank owned, increasingly, by the U.S. government. A bank staffed by docile, saintly, unprofitable bankers. A bank whose stock no Wall Street analyst can in good conscious recommend. But a bank that also, because it has tens of billions of taxpayer money invested in it, can't fail.

Be Ready:
It won't take long before the table is set. I'd give it three years, tops. Your share prices will fall into the low single digits; the Treasury will own ever larger stakes in your business...I trust you will know when the time is right to take the final step.
Step 5: Move in for the kill.
Now it is time for your CEO to pay his semi-annual call to the latest poor fool at the U.S. Treasury who monitors your performance. Our little business really isn't all that profitable anymore, your CEO says...The government really has no business owning us, and there clearly is no upside to the taxpayer, holding shares in this barely profitable venture. Let us turn the bigger part of your investment into a
loan, which we use to buy you out...Allow us to own our firm, as Wall Street traders and bankers once owned their firms. At that point you should feel free to go back to being your old self.

It's good advice. just think about it.

"As soon as possible your CEO must rise in public and say: "For as long as we have taxpayer money we will pay no bonuses""

This can only happen if Wall Street has any soul, and we all know only thing that moves their world is money. They will get their bonuses, whichever way they can. But we still need to make sure they get as "least" as possible!!

"It specifically does mention loans - student loans"

Did you even read the article? The word "loan" does not appear in it. Your Internet browser's search functionality can show that pretty decisively. Quoting myself: "Your link (as always) doesn't support your argument."

"And, levered 5 to 1, you only need a 20% decline in the price for you to have lost 100% of your investment."

I know. That has nothing to do with opportunity cost though. Opportunity cost is what I could be making investing elsewhere, not what I could be losing now. It has NOTHING to do with my current investment. By definition.

"Opportunity cost is what I could be making investing elsewhere, not what I could be losing now. It has NOTHING to do with my current investment. By definition."

Wrong. It has EVERYTHING to do with your current investment - and non-investment. Everything to do with what you could be making, or losing, today.

You're right, though: it doesn't SPECIFICALLY state "loans" - it states subsidies. So if you want a loan one, go here:

http://www.lawschoolstats.com/cgi/opp_cost.cgi

And all over the place. Here's another one:

http://www.mtgprofessor.com/A%20-%20Second%20Mortgages/second_mortgage_versus_401k_loan.htm

And another one:

http://poliwatch.org/indies/2008/10/opportunity-cost-tax-payers-enemy.php

Do you want more? Just email me.

You may be the greatest computer programmer since God the Father programmed Light, but you know NOTHING about economics.

"But we still need to make sure they get as "least" as possible!!"

- how do you plan on doing that....shoot over a text to Barney?

i am so sorry for the long link, but if you can get it to work, it may be worth your while:

http://finance.yahoo.com/tech-ticker/article/124260/Wall-St.-Bonuses-Plummeting----to-Merely-'Astronomical'-Levels?tickers=GS,MS,JPM,BAC,XLF,MER

i know those two look like idiots, but i'm glad they bring this up.
i like to complain as much as the next guy, but we are partially to blame, it there any organization or something we can actually do to act on this and change the situation?

and for the wall streeters who say "were just jealous or not smart enough to do what they do" that might be the case for some, but i know many smart people who choose to do something better for society, rather than see how they can reap the benifits.
and a lot of this is our money, through 401ks, investment accounts, ect. a lot of that money is going to wallstreet. and now its even worse with the direct tax dollars going to these guys.
also about the ny tax revenue (sorry, i think i'm ranting now), sure we rely on their bonuses, but why should we, plenty of other cities around the country make it through a better distribution of wealth.
please please, let me know if there is anything we can do to change this, i dont want to sit on my butt and complain anymore!!

"- how do you plan on doing that....shoot over a text to Barney?"

Exactly, and more! It's precisely the kind of arrogance, greed and selfish attitude that you (garlj) show here that enrages people more over the bankers. I'm going to make sure the wallstreet employees share the pain they have caused other people, and by the way, I do have Barney Franks contact number!

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=apRDGKM7Sbi8

Bonuses for Wall Street Should Go to Zero, U.S. Taxpayers Say
2008-11-11 05:01:00.17 GMT

Nov. 11 (Bloomberg) -- U.S. taxpayers, who feel they own a
stake in Wall Street after funding a $700 billion bailout for the
industry, don't want executives' bonuses reduced. They want them
eliminated...

.... read on garelj!

BONUSES $HRIVEL
YEAR-END PAYOUTS WON'T PASS MUSTER UNDER FED RESCUE

* Comments: 8
* Read Comments
* Leave a Comment

By MARK DeCAMBRE
Click image to enlarge.
Click image to enlarge.

Posted: 4:54 am
November 10, 2008

Wall Street's bonus gravy train appears to be switching tracks.

Goldman Sachs and other major investment banks are mulling tweaks to the way bonuses are paid to executives as these embattled firms come under intense scrutiny for taking tens of billions in taxpayer money designed to breathe life into the financial markets.

Already, banking execs, who in the past took home tens of millions of dollars in salary and bonuses, were facing a bleak year after being upended by the historic credit crisis.

But now that banks have accepted federal rescue money, and the financial industry has come under withering criticism for massive payouts at a time when the sector's underpinnings were coming apart, the compensation picture for many bankers looks even bleaker.

Indeed, sources said some Wall Streeters will see their bonuses shrink by 25 percent to 40 percent, while others are set to get zilch when year-end payouts are decided next month.

It all comes at a time when compensation is facing extra scrutiny by both federal and state officials, including US Rep. Henry Waxman (D-Calif.) and New York Attorney General Andrew Cuomo, who several weeks ago pressed banks to justify the fat bonuses they paid to executives.

The pullback on bonuses stands in stark contrast to last year, when Goldman set aside a whopping $20 billion to pay compensation and salaries to its workers.

This year, Goldman, Morgan Stanley and Bank of America combined might be allocating $20 billion to pay employees, according to Bloomberg.

And that might not be the end of it. Sources said firms are considering reining in for good lavish bonuses, or rewarding people using less cash and more company stock.

Other considerations include spreading bonus payments over years rather than handing out fat paychecks at once.

The idea behind such a move would be to avoid pitfalls that led to the current Wall Street collapse, in which bankers got paid massive bonuses on securities that ultimately imploded. Under this new scenario, execs would be compensated piecemeal based on certain benchmarks.

Some overseas banks are already changing their compensation model.

Australian-based financial giant Macquarie Group is reportedly changing its incentive payments to workers to include fewer short-term incentives.

In the end, Goldman and Morgan may decide to do nothing.

The firms have argued that their bonus structures succeed because they reward talent and prevent top executives from being poached by rivals.

mark.decambre@nypost.com

"read on garelj!"

- taxpayers can want all they want...too bad it wont happen...Citi needs that money to buy another bank and AIG needs another tranche....who can think about the taxpayers at this momment...bonuses (reduced accordingly, but no where near eliminated) will be buried in the financial statements as another expense and cost of doing business

"The firms have argued that their bonus structures succeed because they reward talent and prevent top executives from being poached by rivals."

- exactly

["Opportunity cost is what I could be making investing elsewhere, not what I could be losing now. It has NOTHING to do with my current investment. By definition."

Wrong. It has EVERYTHING to do with your current investment]

We're talking ourselves in circles. I could again tell you that your links don't actually support your claims. I could again tell you that my current investment is irrelevant to the next best alternative (modulo transaction fees). But if you're going to disagree with simple definitions, like "alternative", you can't wonder why the rest of the world doesn't accept the logic you base on your incorrect definitions.

"too bad it won't happen"

..I think this is why people here are saying you are not too bright.

"modulo transaction fees"

What the f*ck is that? Divide your transaction fees by 13 and carry over the remainder?

"I could again tell you that your links don't actually support your claims."

They in fact do. Here's the wiki link, to make it easy:

http://en.wikipedia.org/wiki/Opportunity_cost

You make a decision to buy a car. You spend $25,000. That $25,000 has an opportunity cost before, during, and after you buy the car.

"alternative":

alternative - adjective

1) (of one or more things) available as another possibility; (of two things) mutually exclusive.
2) relating to activities that depart from or challenge traditional norms.

noun

one of two or more available possibilities.

Which part am I missing?

"..I think this is why people here are saying you are not too bright."

Why cause im getting a bonus and you as a taxpayer cant do anything about it? Jusr realize its all political grandstanding, but at the end of the day nothing will happen as there is no law being broken and bonus contraints we're not put in the law for the banks taking $$$$

"Why cause im getting a bonus and you as a taxpayer cant do anything about it?"

no stupid, because. you. just. don't. get. it. .."im"?? getting a bonus" duh, it's not about the little puny joes like you. People here are talking about managements who get millions of dollars of the tax payers money even after driving their companies to losses as well as the entire nation into a ditch, not people like you who gets the crums (less than 1% of what the CEOs get perhaps?). although it's only right that your bonus gets shaved off too since you too were in a sinking boat and got the life jacket -(hand over your goods buddy, just be thankful you stil have a life!) what you get doesn't make a difference and people don't care. you had nothing to do with the direction of the firm, although you'll get to share the pain as no doubt yoru bonus WILL be reduced. but you'll never get it, because you are so full of yourself not knowing how insignificant you are.

And yet even as a meager cog, you are corrupted enough to grant that the politicians are paid by wallstreet bankers/big corporates. Well, even these politicians have to listen to the people when they are enraged as they are now, because they know who gets them re-elected so that they won't be out of a job and attend that pink slip party they are holding tonight.

"Why cause im getting a bonus and you as a taxpayer cant do anything about it?"

Let's gloss this under:

"Chickens. Do not count before they hatch."

Or:

"Arrogance. Why investment bankers are pilloried."

"Well, even these politicians have to listen to the people when they are enraged as they are now, because they know who gets them re-elected so that they won't be out of a job and attend that pink slip party they are holding tonight."

- They listen to who pays their bills more

"They listen to who pays their bills more"

yeah but these bribes/lobbies goes to subsidize their mistresses/high end prostitutes. It's still the taxpayers who pays their legit bills.

"yeah but these bribes/lobbies goes to subsidize their mistresses/high end prostitutes."

- Kind of like Spitzer who tried to take down Wall Street....hypocrite