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Is $100 Million in Annual Compensation Too Much for any Bank Employee to Get?

The Kudlow Caucus
The Kudlow Caucus

Based on the recent Wall Street Journal article, we asked our panel:

Is $100 million in annual compensation too much for any bank employee to get?

Yes: 6
No: 6

Take our poll below!




The Kudlow Caucus Breakdown

Yes
Joe Battipaglia
Market Strategist, Stifel Nicolaus
The structure of a bank is protected by the Federal government and the Federal Reserve. Since they have insured deposits fueling their activities, they should not be allowed to engage in excessive risk transactions which create the kind of earnings that are paid out.

No
Jerry BowyerChief Economist, Benchmark Financial Network
It's not too much money for a talented banker, but it's way too much money for an incompetent banker like Victim Pander-it.

Yes
Keith BoykinFmr. Clinton White House Aide / The Daily Voice Editor
Especially for a bank that's a ward of the state. Shareholders should demand accountability and government regulators should implement strict new clawback rules. And it doesn't matter if one unit does well if the rest of the bank is struggling. Compensation rules will encourage safer risk management.

Yes
Vince FarrellScotsman Capital Management
It is absolutely too much for a banker, or a trader at a bank, or for anyone who takes risks with other peoples money. I understand that some of these guys can contribute mightily to profits, but they can contribute mightily to losses as well. Three is no reason not to shoot for the moon when you have no personal risk and to be rewarded beyond avarice is nuts.

No
Doug KassPresidnt, Seabreeze Partners Management
It is not too much in this case as Citigroup has a contractual obligation to abide by the payment that the trader is entitled.

No
Jim LaCampPortfolio Manager, Portfolio Focus, RBC Wealth Management
Co-Host, Opening Bell Radio Show, Biz Radio Network
And what I mean is that it should be decided by market forces, by shareholders and boards of directors, not by political mandates or agendas.

I do think compensation should be tied to performance, but again, that is to be determined by market forces. Besides, who is overpaid, a trader who made millions in profits for his firm, or for example, Britney Spears?

No
Donald L. Luskin Chief Investment Officer, Trend Macrolytics LLC
It depends on the banker, and the formula by which the $100 million is derived. Warren Buffett makes much more than $100 million a year and everybody loves him.

Yes
Steve MooreSr. Economics Writer, The Wall Street Journal Editorial Board
In this environment, these Wall Streeters who take 100m are likely to be tarred and feathered.

No
James Pethokoukis
Money & Politics Columnist
Reuters
If someone negotiates a deal that pays him $100 million, it should be honored. It's called a contract. And if someone can generate hundreds of millions of dollars in revenue and profits, then such a pay level is far from obscene.

Yes
Robert Reich
Former Labor Secretary
Professor of Public Policy, UC Berkeley
It’s obscene.

No
Noam Scheiber
The New Republic
Not necessarily. But the pay should be structured so that the bankers' incentives are aligned with shareholders' incentives. So, for example, any bonus should be contingent on the long-term profitability of the bet that generated it.

Yes
Lynn Tilton
CEO, Patriarch Partners
It is far too much. There should exist a vast distinction between payment to an executive for hire where no cash investment has been made and funds are paid from the coffers of shareholders and compensation to those who have built businesses with their own investment of cash, creativity and commitment. I believe that a $100 million paycheck to any executive for hire is out of the realm of reason and more so for someone who was present and accounted for during the failure of his institution.

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