Surprise: Goldman Sachs to pay out $5 billion more in bonuses for first three months of 2010

By John Byrne
Monday, April 19, 2010 8:55 EST
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As if to put the icing on the cake, the investment bank Goldman Sachs is set to shell out another $5 billion in bonuses to employees.

What’s more, the bonuses are expected to cover the employees’ work for just the first three months of the year, according to the UK Sunday Times.

According to the report, bankers will receive remuneration of about $170,000 per person for the firm’s 32,500 employees. Some traders are set to receive millions.

Earlier this year, Goldman’s “junior” bankers were told they’d begin receiving salaries that were double their previous takes.

“It’s made me rethink everything,” a Goldman Sachs employee, “sipping champagne,” told the site. “I like the new structure even better. My monthly take home just went way up.”

In 2009, Goldman set aside a total of $16.7 billion for employee bonuses, which amounted to about $700,000 per employee. Goldman Sachs CEO Lloyd Blankfein received $9 million in restricted stock.

News of the new bonuses comes as the Securities and Exchange Commission announced that its charging Goldman with civil fraud over a pre-packaged mortgage instrument they say was designed to fail.

Goldman Sachs created the derivative — called Abacus 2007-AC1 — in response to a request from a hedge fund manager who predicted that the housing market would collapse and wanted to bet against it. The trader, John Paulson, later earned $3.7 billion for his wager. Goldman’s practices cost investors $1 billion, according to the filing.

According to the New York Times, which first revealed details of the Abacus case, the instrument was among 25 Goldman created so that clients could bet against the housing market.

The Times also revealed Monday that top Goldman executives were responsible for overseeing the unit in question, including a role by Goldman CEO Lloyd Blankfein.

John Byrne
John Byrne
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  • Anonymous

    Wow! The old song from Procol Harum- Grand Hotel

    Tonight we sleep on silken sheets
    We drink fine wine and eat rare meats
    On carousel and gambling stake
    Our fortunes speed, and dissipate.
    It’s candlelight and chandelier,
    It’s silver plate and crystal clear.
    The nights we stay at hotel grand

    Tonight we dine at hotel ritz.
    (a golden dish with every wish ).
    It’s mirrored walls, and velvet drapes,
    Dry champagne, and bursting grapes.
    Dover sole, and oeufs mornay,
    Profiteroles and peach flambe,
    The waiters dance on fingertips
    The nights we dine at hotel ritz

    One more toast to greet the morn
    The wine and dine have danced till dawn
    Where’s my continental bride?
    We’ll continental slip and slide
    Early morning pinch and bite -
    (these french girls always like to fight)
    It’s serenade and sarabande,
    The nights we stay at hotel grand
    Les nuits qu’on passe à l’hotel grande.

  • Anonymous

    Didn’t Procol Harum have a song from this too?

    The Grand Hotel:

    …..Tonight we sleep on silken sheets
    We drink fine wine and eat rare meats
    On carousel and gambling stake
    Our fortunes speed, and dissipate.
    It’s candlelight and chandelier,
    It’s silver plate and crystal clear.
    The nights we stay at hotel grand….

  • Anonymous

    Didn’t Procol Harum have a song from this too?

    The Grand Hotel:

    …..Tonight we sleep on silken sheets
    We drink fine wine and eat rare meats
    On carousel and gambling stake
    Our fortunes speed, and dissipate.
    It’s candlelight and chandelier,
    It’s silver plate and crystal clear.
    The nights we stay at hotel grand….

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  • malikk

    these bonuses are nothing hush money.

  • justjoeindenver

    What, no foreplay? At least let me get my pants down first you evil sons of bitches. Change is coming Sachs… We're not too fond of being told to eat cake – Remember what THAT led to?

  • dennycrane

    In 2005 the FBI went to congress with this shit:

    http://www.cnn.com/2004/LAW/09/17/mortgage.fraud/

    …”WASHINGTON (CNN) — Rampant fraud in the mortgage industry has increased so sharply that the FBI warned Friday of an “epidemic” of financial crimes which, if not curtailed, could become “the next S&L crisis.”…..

  • justjoeindenver

    Reminds me of Douglas Adams' “The Restaurant at the End of the Universe” but in this scenario we're all gathered watching as the gaseous giant absorbs everything in it's path only to become bloated and explode. Personally, I'm kind of enjoying watching and waiting for these big players to go down in flames. As I have no investments (or money) it's all just a show for me. Do the meek with big mouths get to inherit the earth, too? Sure hope so…

  • roafer

    Sounds like they need a taxpayer funded bailout!!

    These greedy chumps will only get a slap on the wrist.

  • zingwoo

    ROTFL, no surprise at all. Business as usual.

    Lou
    http://www.vpn-privacy.us.tc

  • dennycrane

    The old Procol Harum song, The Grand Hotel came from this also.

    I tried to post some of the lyrics, but disqus wouldn't let me (?)

  • starvapor

    A “Surprise”?…What's the surprise here?
    C'mon Raw Story…Who are you trying fool?

  • tonylinc

    What the ell is going on?? Is there no watchdog agency to prosecute these A-Holes??

  • edwards_com

    Obama's nominees are being blocked by the NEOCON Fascist Tories in the Senate

  • OldAtlantic

    For buy side firms, its a privilege to buy mortgages from Goldman Sachs. Its a privilege for any buy side person to meet any employee of GS even a 2 year analyst between college and B-school. The chance to move up in the financial universe is controlled by GS.

    For the CEO this might mean his own opportunities to participate as a player in hedge funds or be named to a board. Junior employees dream of being hired by GS. This won't hurt GS sales to buy side institutions at all. Not a bit. Its a privilege to buy mortgages from Goldman Sachs. Its a privilege to get a phone call from GS telling them they can buy in the current mortgage deal.

  • Corporate Indu$trial Complex

    .
    U.S. GOVT OUTSOURCES PROSECUTIONS OF WALL STREET BANKSTERS TO CHINA

    – All Sachs, Lehman, AIG, Citigroup, TARP CEOs To Be Publicly Hanged In Beijing On Live TV —

    – Bernake, Paulson, Greenspan, Rubin, Summers Also Condemned, After Organ Harvesting —
    .

  • Economic Disobediance

    Shocker? Hardly…The game is still on.

  • HackDave

    Sarcasm doesn't translate well in black and white text.

  • OldAtlantic

    Great link Denny.

  • Joseph Conrad

    These Wealthy White Men are pure Vampires! They're incapable of changing their behavior – lying, thieving, cheating and robbing and calling it 'Capitalism'. They want Americans and the World to believe “The Market made me do it! “.

    These pure-bred Vampires will never sleep, they'll never eat. They'll never stop stealing, lying and cheating until a STAKE is driven through their hearts. But alas, what American men have no taste for the Blood of their own kind. They just want the Oil, Gas and Minerals of every Resources-Rich nation rather than CLEAN UP AMERICAN DEMOCRACY!

  • harlinredlands

    If there were no Iraq War, and no Banker Bailouts…. we'd have enough money to provide every human in America with 100% free health care, and more.

  • chickencoop

    Why be surprised… This additional “bonus” payout maneuver is essentially “don't squeal — don't talk” moolah — known as ” HUSH MONEY “. Look at the context, Goldman Sachs, et. al. are financial-mafia criminal banksters.

  • robertsfinnegan

    Remember your psychotic, fecal diatribe when they arrive to take your home. Will it be a privilege to hand your house keys over to a GS criminal? For that matter, would you would be privileged to give them a blow job for letting you have 1 hour to get your belongings out instead of the standard 30 minutes?

    Robert S. Finnegan
    United States Marine Corps
    rsfinnegan@gmail.com
    Jakarta, Indonesa

  • anonymous

    I am empathizing with late 18th century French peasants more and more every day…….

  • OldAtlantic

    There you go again. You are so eager to eliminate the white race that you can't even recognize what was written.

  • http://profiles.yahoo.com/u/ELVTDDVUCWPZ7KUQ7GGXIDWU5E David V

    The anger over bonuses is a red herring.

    In a free market, bonuses are a common way of rewarding performance. There is nothing wrong with the idea of paying people for success. From the perspective of the balance sheets of the bailed out companies, the bonuses are well deserved, given that these companies are getting billions of dollars for “free.”

    The problem is that the money these companies are getting was stolen from dollar users (not just taxpayers, since the debt is being paid by printing new currency), and is keeping unproductive, financially irresponsible companies afloat. By virtue of being bankrupt in the first place, these companies have demonstrated that they are consuming more resources than they are creating – and ought to be bankrupt.

    What we should really be angry about is that the political class is punishing success and rewarding failure by taking money from productive people and businesses and giving it to unproductive ones.

  • turnip

    They would have already imploded, without the purchase of the regulators and legislators and the Treasury, and the FED.
    It's not just GS either. It's all the remaining illegal wealth extraction corporations.

    Happy Patriots day!

  • jon mccane

    I still maintain that these Republican Fatcat Bankers such as Goldman Sachs, Lehman Brothers and the others have done far more damage to the United States than Al-Queda, the Taliban, and Iran have done. Here you have it again: Goldman Sachs indicted and they turn around and give 5 Billion dollars out for the first three months of 2010. They are despicable criminals spitting in the face of all the unemployed Americans, those of us who have had our retirement accounts destroyed by their criminality, and all taxpayers.

  • Anonymous

    Perhaps they will share a condo at Camp Fed with the Enron crooks.

  • Anonymous

    Perhaps they will share a condo at Camp Fed with the Enron crooks.

  • Anonymous

    Perhaps they will share a condo at Camp Fed with the Enron crooks.

  • gypski

    time to send all Goldman executives and underlings to the slammer. No, passing go and collecting $200.

  • overdoneputaforkinit

    Money buys loyalty and keeps secrets secret. Wall-street is just a richer, nicer Mafia.

  • rgriffsf

    This shit makes me so F***in mad I can't breath. The pot is about to boil over.

  • kwertie

    What exactly qualifies this news as “shocking”?

  • justjoeindenver

    All of these warnings signs of the coming revolution, and the talking heads continue to dismiss it as a few radical extremists… When they look back upon this time historically, they will be amazed at how much writing was on the wall and how much time they had to quell the masses and stop the revolution, but they were so drunk on power and blinded by arrogance that they didn't think the mobs would come to their doorsteps. Future generations will thank us for our actions, even if this one won't take the time to heed the notice. Just don't tell us how you didn't see the signs when this is all over – it won't get you mercy.

  • kwertie

    disqus sux

  • robertsfinnegan

    If that was satire you should have your fingers chopped off, you racist fuck. Otherwise, expect your illiterate ramblings to be sniped at. It's just too good to pass up.

    Robert S. Finnegan.

  • pat riot

    and the tea party patriots will defend these bonuses right? Mitch McConnell and the other republicons will support these bonus bailouts for the Uber Rich. This is socialism for the rich and a good rogering for the poor, I lost my job, am up to my ass in debt and may lose my home. WHo can i fight in a ring to maybe have a chance at the American Dream? WTG OMFG this is so crazy

  • kwertie

    Unregulated corporatism is the REAL republican religion.

  • kwertie

    But you know that would never happen.

  • Prattvictory

    So is Chelsea Clinton's future husband going to get part of the bonus as a Goldman-Sachs employee?

  • Prattvictory

    So is Chelsea Clinton's future husband going to get part of the bonus as a Goldman-Sachs employee?

  • davidrvelasquez

    We can still dream, can't we?

  • davidrvelasquez

    All those bonuses will probably go directly to legal firms.

  • johnniefavorite

    Go down in flames? Maybe in that universe that author was talking about….not this one.

  • malikk

    stay away from the daily CIA kos , enough already with that tories bullshit

  • vic_vega

    They just moved into a brand new building that cost 2.1T to build. Everyone remember, these profits come mainly from their proprietary trading desks (actually computers that run the stock market up.) These profits are coming from mutual funds, retirement accounts and retail traders. In other words, the american middle class. Don't let these bastards off the hook, EVER!

  • vic_vega

    I don't know. I think they may settle causing a dump in the stock price and then the guys that took them public in 07 will take it private again (now that they don't need access to the federal reserve's money at 0% to gun the stock market.)

  • Prattvictory

    Just doing God's work.

  • edwards_com

    NO
    The NEOCON'S are blocking Obama's nominees.

  • quincunx

    Do you think that the bank has agreements with these people that they cannot reveal
    bank info until 5 years after quiting. And that the money is to insure they stay as long
    as possible…

  • Benway for the Nova Police

    It's not a crime to bet against a bubble. In fact, if some of the homeowners who are now under water had bet against the mortgage market, they might actually own their houses now. The problem with this story is that it doesn't distinguish between obscene bonuses and perfectly normal market instruments. Granted they should have been regulated, but that's not the fault of the brokerage houses, except to the extent that they lobbied against regulation with the Bush Admin.

  • Benway for the Nova Police

    If folks haven't figured out by this point in the history of the world what a bubble is, I can't say it bothers me that some of them lost their shirts. As for derivatives, the very function of these is to insure against losing your shirt. Obviously, somebody was smart enough to see the crash coming.

  • LaMer

    by a raise of hands – who in here is shocked???? Anyone????

  • NadePaulKuciGravMcKi

    The manner to which they are accustomed
    The chosen the superior

  • Luke

    nicer?

  • dave

    Now go home and get your fuckin' shinebox

  • grindermonkey

    And we wonder why people hate us. Who is regulating this fiasco?

  • mrgames2

    Support the president by supporting financial reform today http://www.youtube.com/watch?v=t-KtZDi7pcY

  • donofcali

    Derivatives were created so farmers wouldn't go broke if they had a bad crop due to natural reasons. They were never intended to be used to insure hedge funds against bad gambles.

    AIG should have been left to fail. Goldman should have taken a serious financial slamming. But this couldn't happen since the Plutes are now fully imbedded in the Treasury (not just the Fed anymore).

  • vic_vega

    Support this legislation? Are you serious?!?

  • Boneman

    N-I-C-E-R-?-?-?-?-?-?-?

    Oh, you mean the banksters don't kill you as fast???

    Personally I prefer the quick death… the soldiers death.

    Unless of course, you're just a pathetic masochist who wants to be a slave on their knees licking the dirt off the boots of the people who steal from you and think you're low.

  • donofcali

    One could make a pretty rational argument that if US multinational corporations simply had to actually pay corporate taxes on foreign-derived income, instead of “indefinite tax deferment”, we'd have enough to fund Medicare for all.

  • Jon Waine

    Goldman Sachs, you're my idol! Life is truly about being a winner at the cost of many losers. I like how you clearly demonstrate this. It's so simple and childlike while superbly genius!

  • donofcali

    You're likely correct. But I think that there is some minute possibility of getting these angry tea baggers to realize that the enemy is not our government, but instead is the entrenched Plutocracy that currently occupies our government. If only they could be turned towards the Light against our common enemy…

  • donofcali

    Perhaps it's time to pull the guillotine out of mothballs…

  • overdoneputaforkinit

    They're “nicer” to their employees than the Mafia is to their employees. That's why they bribe them to stay loyal instead of threaten. Why does everything have to be about you?

  • BUDDAH

    SHOCKER!!!!!! THEY STEAL MONEY HOW IS THAT A SHOCKER???? DISMANTLE AND GET RID OF THIS CORRUPT SO CALLED BANK AND ALL THE REST OF THEM THE FED THE TREASURY WALL STREET ALL THE CORRUPTION!! OFF WITH THEIR HEADS!!! PEACE BUDDAH

  • Anonymous

    Errr, “pirates day.”

  • Anonymous
  • mrgames2

    I am confused. A few hours ago you posted a comment against big banks on this board. Now you are for them? Troll much?

  • roscoe sauza

    Yep, Republican fat cats. Goldman Sachs' CEO political contributions – Democrats get 65%, Republicans get 4%. I suggest the following:
    http://www.newsmeat.com/ceo_political_donations…

  • TaterSalad

    LOL,LOL,LOL……..The real question is this: “Will the liberals Messiah pay back Goldman/Sachs contributions?? What a hypocrit! The libs will follow anyone to the river!

    http://therealrevo.com/blog/?p=25598

  • bushfatigue

    The money changers are looting the Temple for one last time before they are cast out.

  • bushfatigue

    The money changers are looting the Temple for one last time before they are cast out.

  • Malcolm

    Me too. There was a big Icelandic volcano then also.

  • Malcolm

    Me too. There was a big Icelandic volcano then also.

  • Malcolm

    Every politician with a hope of a Goldman handout will defend the bonuses; after all, they stand to get some of them.

  • Malcolm

    Not only a rational argument, but a fact based argument. The tax strategies of US multinationals boggle the mind. They pay less in tax than all of us with minimal incomes, like Warren Buffet paying less in tax than his secretary.

  • Malcolm

    Not my field, but could a case be made out of that? Intuitively, makes sense to me. Bonuses are traditionally at the end of the year. Then there's an indictment, and almost instantly you've got early and very substantial bonuses. DOJ, get on it. (Fat chance).

  • Malcolm

    I wish you were right, but as long as everyone still has professional sports and other TV, the modern version of bread and circuses, they won't notice what's going on until it's too late.

  • BuckJohnson

    Can you imagine a bonus check of at least 170,000 dollars for the first 3 to 4 months of this year, and this is on top of their yearly check. And many are getting in the millions too. No wonder life is good being a banker and especially a connected banker. Heck, the person getting the minimum of 170,000 dollars can now go on that family vacation to Hong Kong, and Australia with a stop over in Japan for a week. And they still will have a crap load left over from the quarter bonus. How do all of you guys and gals feel right now. Working 9 to 5 or 2nd shift, making 25 to 45 thousand a year with if your lucky a hundred dollars or more bonus. Having to worry about your bills every month. When you make this kind of money that seems to fall behind, thats why they are so out of touch with us regular people, because they don't have to worry about being a few paychecks away from the poor house and not having a house or apt..

    You know what this story and others like this reminds me off, the bankers and financial men of the Gread Depression. While everything was turning bad they where getting paid, until it finally got to them and they started to jump from the windows. They too never thought that they would be poor, and when it happened they where shocked into disbelief. Welcome to the roaring twenties everybody, we haven't seen the worst of this depression yet not by a freaking long shot.

  • http://www.facebook.com/profile.php?id=1230591417 gtownfunk

    Not just “don’t squeal”… I think it’s “hire 24hr security for your giant house”, “buy lots of guns and learn how to use them”, “bulletproof your car”, all that kind of crap. Once the teabaggers figure out who they’re _actually_ mad at all hell is going to break loose.

  • Prattvictory

    You're just blowing smoke

  • dennycrane
  • farang

    Gotta start in D.C. with their enablers. I've always favored hanging them from the Key Bridge, while enjoying a nice soft shell Maryland crab on a soft roll, with an ice cold Carling Black label. Right on the banks of the Potomac.

    4th of July sound good to anyone else?

    We can place bets on how long a US Senator's toes wiggle before the final kick. Longer than a US Congressman? Let's see.

    Then we'll all bus up to NYC, and see if the banker doing God's Work” can last even longer. We'll “sip champagne” and tie knots.

  • http://www.facebook.com/profile.php?id=1230591417 gtownfunk

    Man, it's only 5 _billion_ not 5 _trillion_… what are you worried about? It's not like they used billions in taxpayer money to program trade the market up on low volume this time last year. Do you guys remember how in the first quarter of 2009 GS changed their fiscal year and magically December 2008 disappeared off the books? Maybe someone should ask questions about that now that it isn't anti-American to question GS.

  • http://CatReligion.org/ Bast Hotep

    If you think he's wrong, I have one word for you: Idiocracy.

  • http://CatReligion.org/ Bast Hotep

    If you think he's wrong, I have one word for you: Idiocracy.

  • http://thejoesteelblog.blogspot.com/ Joe_Steel

    Why isn't the federal government taxing-away all the money?

    We need laws to tax some kinds of earned income at much higher rates. Any investment banking income above $1,000,000 should be taxed at 100%. Anything above $10,000,000 should be taxed at 110%.

  • CosimodiRondo

    Surprise? Shocker? Not really. They are stealing as much money as possible before lawsuits can get any of it back.

  • CosimodiRondo

    So Gold In Sacks is doling out a nice little chunk of hush money to its employees, in case anyone was in danger of developing one of those pesky consciences and maybe doing a little whistle-blowing.

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    [...] cash through bailouts, payments and backstops; in addition to $16.2 B in 2009 bonuses paid out Goldman Sachs paid out $5 billion more in bonuses in the first three months of 2010 [Without Governments bailouts Goldman's bonuses would have been zip, zero, [...]

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