Goldman Holders Miffed at Bonuses

[mbperrin]

Source: Wall Street Journal

Some of the largest shareholders in Goldman Sachs Group Inc. have urged the Wall Street firm to reduce the size of its bonus pool, arguing that it should pass along more of its blockbuster earnings to investors, according to people familiar with the situation.

The investors hold tens of millions of shares in Goldman Sachs, which is on track to make the biggest employee payout in the firm's 140-year history.

Their complaints in private conversations with the company and at analyst meetings show how anger over its big-money culture is spilling into the ranks of investors who typically shy away from debates over Wall Street pay.

One frustration: Despite record net income and compensation at Goldman as markets rebound and the firm outmuscles weakened rivals for business, analysts expect its 2009 earnings per share to be 22% lower than in 2007 and roughly equal to its 2006 earnings, according to Thomson Financial.

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Read more: http://online.wsj.com/article/SB10001424052748704533904574545981008841004.html?mod=WSJ_hpp_LEFTWhatsNewsCollection

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Silly investors! They didn't think the pirates would share the loot, did they?

:)

[no_hypocrisy]

1. Shareholders could short the stock and sell off en mass in protest

except it would be spiting themselves as the value would fall with that gesture. All they really have is a vote during the annual meeting and even that's compromised as the Board of Directors nominate directors and officers of the corporation, not them.

[Lucky Luciano]

3. That would set up a massive short squeeze when Goldman

Announces a share buy back!

[napi21]

2. I'm very pleased to hear this! Fir YEARS I've been conplaining

about WS pay & bonuses, but the only people who hhave the power to change it are the majority stockholders. Believe me, I've seen corp. execs shudder at any maj. stockholder gripe.

I actually can't believe they were that brazen to lower EPS that much for employee compensation and not expect strong blowback!

[On the Road]

5. Hey, It's Been Going on for Decades!

I can't understand why stockholders have been so patient with the high percentage of earnings going to top executives. That's how the controls are supposed to work in theory, but since the 80s they have been completely ineffective.

I am also delighted to hear this, and just hope it's a trend. Otherwise, the federal government is going to have to impose controls, which are usually done as a last resort and are rarely as effective.

[On the Road]

6. Hey, It's Been Going on for Decades!

I can't understand why stockholders have been so patient with the high percentage of earnings going to top executives. That's how the controls are supposed to work in theory, but since the 80s they have been completely ineffective.

I am also delighted to hear this, and just hope it's a trend. Otherwise, the federal government is going to have to impose controls, which are usually done as a last resort and are rarely as effective.

[Lucky Luciano]

4. Employees are massive shareholders too though, so I doubt theyw

Would vote against said bonuses.

[Speck Tater]

7. The execs, the investors, the general public, are ALL saying exactly the same thing...

It's the same thing everybody always says about any economic controversy: "Give the money to us, not to them."

[RaleighNCDUer]

8. so, not satisfied with ripping off the general public with the bailout,

they are now ripping off their shareholders.

What a GREAT business plan.

[Raster]

9. Let's get real: it's the "non-employee" shareholders bitching about the bonuses.

The employee shareholders, those that will be receiving the bonuses, are doing just fine. Your comments about pirates and loot certainly ring true. I can think of two more words: plunder and pillage.

Goldman Sucks has been a part of EVERY DIRTY TRICK played on the American financial system in the last 50 years. That $5.00 a gallon gas? Thank GS! Those obscene extortion payments to AIG? Thank GS! The current real estate debacle? Thank GS! And this is only the top of the barrel.

[flyarm]

10. yawn...

[Scooter24]

11. About 48% of the company is still owned and controlled by the 200+ group of partners...

Roughly 22% is owned by the non-partner employees.
18% is controlled by retired partners and two long-term investors (one bank, one private school foundation controlling over 45 million shares)

That leaves about 12% of the company up for purchase from retail customers on the market.

Even if this group pushed a vote at the shareholder's meeting, the largest block, the company, employees, and partners, still make up about 88% of the voting stock.

[Sinti]

12. The payout even if it went to the investors

would go to the Institutional Investors first...most of which are other banks.