[quote=jpinpb]Ok, guys. I know I’m missing something here. Why are you giving Breeze such a hard time. He’s posted some interesting articles. [/quote]
I don’t know. First, I never called Breezie and idiot directly. He said himself I thought he was an idiot. Second, I’m sure he’s a swell guy, but it’s entertaining.
Breezie, has a habit of posting an article, jumping to conclusions, and if your line of thinking doesn’t jive with his, despite whatever data you may bring to the contrary, still call you an idiot, which is ironic.
Second, Breezie has a nat for overgeneralizing and stereotyping about people, information, professions, about things which are clearly over his head.
Third, Breezie will come out with a statement, and the few times when his statement is called because it isn’t true, mysteriously it’s backpeddled.
Let’s explore each of theses.
1) Not that I really care about elections and politics. For the past couple of months Breezie has been on “Messiah Obama” kick. Because his opinion, is “let’s tax the fvck out of the rich, because all rich people don’t deserve their wealth”.
Well, let’s see, some rich people are a-hole bankers like Countrywide douchebag, GM Wagoner, and arguably Carly Fiorina…But let’s see, by Obama’s definition of rich, rich people include doctors who spent a good deal of their lives going through shit, enginerds who built companies and employ people people who saved and invested wisely rather than pissing it away in boos and other crap from walmart, and even some overpaid salesman who earn a fat check for closing deals. Except, point #2, a few months ago, Breezie mentioned he was in the top 5% of the income earners of the U.S. And obviously because he also mentioned he is single, this means his “miniscule” tax increase from obama tax on rich only kicks in if his agi is $250k+ on a single income…I won’t speculate if it is below or above that. At the same time, a few months before that, he was b!tching about how he cannot afford a SFH in carmel valley, LJ,etc, because these homes cost close to $1million. Which is also oxymoronic, because on one had , one preaches about taxing the rich, and the other hand, it appears there’s this sense of entitlement that by golly I should be able to live like a king in a 2800sqft SFH in a very nice community on a single income folks without previous ownership of a starter home, without having established a wealth basis, etc…but rather let’s have Obama and crew steal from doctors,enginerds,etc and redistribute to me so i can enjoy my plushy lifestyle.
3) Third, generalizations. Breezie here is basically stating all I-bankers are aholes and should have their wealth redistributed, citing folks like Lewis,Goldman CEO,AIG assholes,etc as examples as their all bad.
I will spare the gory details, but anyone with some exposure to basic I-banking would acknowledge the I-banking is a hugely diverse profession with different people doing different things. Some of these things, include M&A activity/financing IPO activity/financing, or simply just getting companies that need money financing, aside from those shaddy mortgage-repackaged-as-securities thing. I-banking is as much part of keeping/growing any mid-large company as anything else, particularly since a good portion of companies cannot complete business without some sort of financing and assistance. This is why you have some companies completely unrelated to banking in the rut that it is. It’s not black and white, and most folks on main street won’t get it (inclusive).
Breezie BTW, again based on your trademark inaccurate generalization, the small percentage of my relatives in I-Banking (and it is small) aren’t a direct beneficiary of TARP, because either (1) they are M&A, IPO, or private equity folks who work for firms overseas who are gobbling up cheap assets or (2) they are good enough to be able to work for companies that aren’t a tarp recipients and wouldn’t put up with what they think are bullshit limits on wall street compensation packages…. which brings be to the next point….
As a taxpayer, I fully think tarp funded banks should be pay capped. But, fyi, as abhorrent as some of these elaborate compensation packages may seem, the only thing that a pay cap is going to do to some of these firms is that top talent will simply pick up their bags and go work for firms (mostly overseas) that don’t have these pay caps, and the end result will be you get a bunch of shitty 4th or 5th string bankers who can’t otherwise be employed elsewhere running tarp-funded banks (my opinion). One probably needs to ask why can’t the SEC find top talent to understand this stuff? Simple. SEC doesn’t pay enough to attract top talent.
You know, some of those AIG bonus recipients were employees hired after the AIG fiasco by the plan with the government to clean up the mess. AND Obama and crew with the now AIG CEO offered to pay them the bonus as part of the employment. Of course when the media caught wind of the bonus, two face Obama and crew decided to say “surprise surprise, we’re so fricking shocked such bonuses were paid”…
Put it in perspective Breezie, since you work in Sales, how would you like it if you work for a company, you made your quota, got your 40% sales bonus, and then the government said, sorry we’re going to tax you at 99% after you already spent it? Ah, but but but, you say, that wouldn’t happen to you….That’s exactly my next point. As long as it doesn’t happen to you, it’s fair game.
The following is a letter sent on Tuesday by Jake DeSantis, an executive vice president of the American International Group’s financial products unit, to Edward M. Liddy, the chief executive of A.I.G.
Readers’ Comments
“Hint: If your company accepts tens of billions of dollars from taxpayers, consider your bonus renegotiated.”
Rolf, New York
* Read Full Comment »
DEAR Mr. Liddy,
It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:
I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.
After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.
I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.
You and I have never met or spoken to each other, so I’d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me acceptance to M.I.T., and the institute’s generous financial aid enabled me to attend. I had fulfilled my American dream.
I started at this company in 1998 as an equity trader, became the head of equity and commodity trading and, a couple of years before A.I.G.’s meltdown last September, was named the head of business development for commodities. Over this period the equity and commodity units were consistently profitable — in most years generating net profits of well over $100 million. Most recently, during the dismantling of A.I.G.-F.P., I was an integral player in the pending sale of its well-regarded commodity index business to UBS. As you know, business unit sales like this are crucial to A.I.G.’s effort to repay the American taxpayer.
The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity — directly as well as indirectly with the rest of the taxpayers.
I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country’s call and you are taking a tremendous beating for it.
But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut.
My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That’s probably why A.I.G. management assured us on three occasions during that month that the company would “live up to its commitment” to honor the contract guarantees.
That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts “distasteful.”
That may also be why you authorized the balance of the payments on March 13.
At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts — until several hours before your appearance last week before Congress.
I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It’s now apparent that you either misunderstood the agreements that you had made — tacit or otherwise — with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds.
You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.
As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.
Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you.
The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to “name and shame,” and his counterpart in Connecticut, Richard Blumenthal, has made similar threats — even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press.
So what am I to do? There’s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn’t disagree.
That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.’s or the federal government’s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need.
On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less — in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients.
This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear.
Mr. Liddy, I wish you success in your commitment to return the money extended by the American government, and luck with the continued unwinding of the company’s diverse businesses — especially those remaining credit default swaps. I’ll continue over the short term to help make sure no balls are dropped, but after what’s happened this past week I can’t remain much longer — there is too much bad blood. I’m not sure how you will greet my resignation, but at least Attorney General Blumenthal should be relieved that I’ll leave under my own power and will not need to be “shoved out the door.”
