Wall St. Idiots Just as Stupid as Other Idiots

The Captain was under the apparently mistaken impression that Wall St. bankers, in addition to being immoral monsters who dine on poor babies' still beating hearts for breakfast, were supposed to have a handle on basic arithmetic. These people deal with numbers for a living, do they not? It turns out that mid-level banking grunts on The Street are every bit as innumerate as the typical mathematically-challenged American moron.

Bonus season is fast approaching on Wall Street, but this year the talk does not center just on multimillion-dollar paydays. It’s about a new club that no one wants to join: the Zeros.

Drawn from a broad swath of back-office employees and middle-level traders, bankers and brokers, the Zeros, as they have come to be called, are facing a once-unthinkable prospect: an annual bonus of ... nothing.

[...]

In some ways, a zero bonus should not come as a surprise to many bankers. As a result of the 2008 financial crisis, Wall Street firms like Goldman Sachs and banks like Citigroup raised base pay substantially in 2009 and 2010. They were seeking to placate regulators who had argued that bonuses based on performance encouraged excessive risk.

At Goldman, for instance, the base salary for managing directors rose to $500,000 from $300,000, while at Morgan Stanley and Credit Suisse it jumped to $400,000 from $200,000.

Even though employees will receive roughly the same amount of money, the psychological blow of not getting a bonus is substantial, especially in a Wall Street culture that has long equated success and prestige with bonus size.

One executive, whose firm prohibited discussing the topic with the news media, said the bump in base salaries had confused people, even though their overall compensation was the same. “People expect a big bonus,” this person said. “It is as if they don’t even see their base doubled last year.”

Ah, the "psychological blow" of getting no bonus after having your fat salary doubled is the kind of bringdown the Captain could use more of himself.

[NYT]