Wall Street Plans $38 Billion of Bonuses as Shareholders Lose $74 billion and Food Pantries Struggling with Shortages
Posted in Newsroom on November 19, 2007 – 11:14 am
Wall Street Plans $38 Billion of Bonuses as Shareholders Lose
Bloomberg - Nov. 19
Shareholders in the securities industry are having their worst year since 2002, losing $74 billion of their equity. That won’t prevent Wall Street from paying record bonuses, totaling almost $38 billion.
That money, split among about 186,000 workers at Goldman Sachs Group Inc., Morgan Stanley, Merrill Lynch & Co., Lehman Brothers Holdings Inc. and Bear Stearns Cos., equates to an average of $201,500 per person, according to data compiled by Bloomberg. The five biggest U.S. securities firms paid $36 billion to employees last year.
The bigger bonus pool derives from a record $9 billion of fees for arranging acquisitions and $5 billion for underwriting initial public offerings and sales of junk bonds, the most lucrative securities, Bloomberg data show. Bankers’ record fees help explain why 2007 will prove to be the industry’s second- most profitable after the subprime mortgage market collapse led to losses at Merrill and Bear Stearns.
Food pantries struggling with shortages
Associated Press - Nov. 19
Operators of free food banks say they are seeing more working people needing assistance. The increased demand is outstripping supplies and forcing many pantries and food banks to cut portions.
Demand is being driven up by rising costs of food, housing, utilities, health care and gasoline, while food manufacturers, wholesalers and retailers are finding they have less surplus food to donate and government help has decreased, according to Lisa Hamler-Fugitt, executive director of the Ohio Association of Second Harvest Foodbanks.
“I’ve been doing this for 20 years, and I can’t believe how much worse it gets month after month,” she said.
“We have food banks in virtually every city in the country, and what we are hearing is that they are all facing severe shortages with demand so high,” Ross Fraser, a spokesman for America’s Second Harvest — The Nation’s Food Bank Network, the nation’s largest hunger relief group, said Friday. “One of our food banks in Florida said demand is up 35 percent over this time last year.”
