Bonus Time in the City

Not only is Christmas approaching but for many people in the finance sector its also bonus time and its about now that the early birds start to find out what sort of bonus they’ve been awarded. A little birdie tells me there was a mood of euphoria at the Goldman’s Christmas party last Thursday night, not surprisingly but one should remember that its only the top executives who have reaped the top rewards. For the many hard-working individuals lower down the ecosystem its not been quite so breath-taking.

How Goldman Sachs can offer its star performers £18bn-worth of bonuses

The shrewd investment banking giant has skilfully avoided the pitfalls of the sub-prime crisis that have plagued rivals Merrill Lynch and Citigroup, and as a result the Wall Street bank is expected to award the largest bonuses, with a pool believed to be worth around £18bn.Late last year, the bank made a call on sub-prime lending which led it to reduce its holdings of mortgages and related securities and to insure against losses on its remaining portfolio.
 
That prophetic move, which has made the bank the envy of its rivals, means Goldman has positioned itself to profit from the crisis. The bank has seen three consecutive years of record profits and the last quarter was no exception with it earning $2.85bn (£1.38bn).

Its certainly been a year of winners and losers and when the music stops in this financial game of pass the parcel its really a matter of who is left holding the toxic gift that just keeps on giving. Make’s one wonder where this gift really came from in the first place.

Fortunately in my world the damage has been minimal but what makes me feel sad is how I’ve seen the bonus culture mutate over the years. It used to be that bonus pool funds made their way down the chain of command to enrich the lives of the more ordinary folk who’ve also made stunning contributions to the overall success of the bank, particularly those of a more technical capacity, but increasingly I’m seeing the wealth concentrated amongst the top echelons with eye-watering remunerations while forgetting all those little people who toiled through the night without all the glamour to make it all happen.