Bank bonus

The pitchforks are out and the mob is off and running. Amidst the green-eyed hysteria over bank bonus payments, there has been little evidence to suggest that 'excessive' bonus payments are responsible for the recent crisis. Indeed, amidst it all, there are a couple of counter-points. First, The Epicurean Dealmaker gives us an overview of investment banking compensation. The highlight.

There are a lot of knocks you can legitimately put on Wall Street, but claiming investment bankers take crazy risks just so they can walk out the door December 31st with pockets full of cash, free and clear of future effects on their employer, is not one of them. Unlike the public shareholders in their firms, who are mostly highly diversified and therefore have far lower relative exposure to the health and survival of any one bank, investment bank employees can't yank their accumulated years of compensation out of their employer when the shit hits the fan. They are stuck, and they have a hell of a lot bigger personal stake in the future health and survival of their firm than any public shareholder.

The second is a filling by the late-great Lehman Brothers on their stock incentive plan and a WSJ article outlining the exposure of Lehman employees to the firm.