Fannie and Freddie Detail Retention Bonuses

[acmavm]

Source: New York Times

April 3, 2009, 11:11 am
Updated at 12:25 p.m.

Just a few weeks after retention bonuses at American International Group became a national scandal, Fannie Mae and Freddie Mac, the two mortgage-financing giants that the government rescued last fall, have outlined plans to pay an additional $159 million in bonuses to retain employees in 2009 and 2010, on top of the nearly $51 million already paid out last year.

James B. Lockhart of the Office of Federal Housing Enterprise Oversight, which now oversees the two companies, disclosed the bonus programs in a letter to Sen. Charles Grassley, the ranking member of the Senate Finance Committee.

In the letter, Mr. Lockhart defended the payouts as a way to “keep key staff without rewarding poor performance.” (Download the full letter below.)

Lawmakers have harshly criticized some bailed-out companies that later offered bonuses to workers, and the House passed legislation this week that would seek to limit compensation and bonuses at such firms.
-MORE-

Read more: http://dealbook.blogs.nytimes.com/2009/04/03/fannie-and-freddie-detail-retention-bonuses/?partner=rss&emc=rss

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Damn. More bonuses.

These people should be glad the have a job.

[soothsayer]

1. I didn't get a retention bonus, nor did I get retained. Severance runs out April 6.

But yeah, what a crock! There was NO WHERE for our foolish execs to go---nor would anyone want them. Yet the first thing the installed CEO did--the very first thing he announced at his very first meeting with us---was these godforsaken bonuses.

[Lucky Luciano]

8. I used to be in the finance business until I got laid off from

our prop trading desk. Our bosses traded a lot of FNM and FRE (poorly), but avoided the death spiral. What did you do for FNM?

[soothsayer]

9. I was in a support function rather than involved with the financial stuff

[TheCoxwain]

2. Those MotherFuckers have BIG BALLS... may be

the Shooter in NY should have gone here instead .

[tomm2thumbs]

3. (laughing awkwardly)

[OhioChick]

4. When is this bonus shit going to stop? n/t

[williesgirl]

5. Not one fucking penny in any type of bonus. Period. It's our money. They're lucky to have jobs.

rec'd

[blue_onyx]

6. Are fucking kidding me!?!

This has got to be stopped. Why are people letting this happen?

[acmavm]

7. We would have to get off our asses and do what the Europeans

did for the G20 members. Take to the streets.

That's the only thing we have. That's all that's left. But I'm afraid that when we do, it's not going to be good.

[ardvark]

10. Working people need to adapt to incentives

quit studying math and science to learn skills to build stuff

learn to take big gambles, that cost the taxpayer a fortune

obviously, that's what our society needs, based on the incentives

[ardvark]

11. Fannie, Freddie worker bonuses total $210M

Source: AP/Yahoo

WASHINGTON – Mortgage finance giants Fannie Mae and Freddie Mac plan to pay more than $210 million in bonuses through next year to give workers the incentive to stay in their jobs at the government-controlled companies.

The retention awards for more than 7,600 employees were disclosed in a letter from the companies' regulator released Friday by Sen. Charles Grassley of Iowa, the senior Republican on the Senate Finance Committee. The companies paid out nearly $51 million last year, are scheduled to make $146 million in payments this year and $13 million in 2010.

"It's hard to see any common sense in management decisions that award hundreds of millions in bonuses when their organizations lost more than $100 billion in a year," Grassley said in a statement. "It's an insult that the bonuses were made with an infusion of cash from taxpayers."



Read more: http://news.yahoo.com/s/ap/20090403/ap_on_bi_ge/mortgage_giants_bonuses

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Bonuses! Yippee!

[Javaman]

12. See it works like this...

AIG was the poster child, people got all up in arms over that, but now that that has been "dealt" with, we are on to the new news cycle in our short attention span society.

they will get away with this and the tools at AIG will say WTF?

it's like the stock market, it drops and rises in 3 digit numbers now like it's old hat. nothing special anymore, just more of the usual bullshit.

the rich eat the poor, but they don't call it soylent green they call it, progress.

[soothsayer]

13. well, to be fair, Herb had promised us these bonuses before we took a dime

of gov't money

[Hassin Bin Sober]

15. You mean before the company went belly-up?

Maybe all bets should be off?

Retention? I say fucking quit and find a job somewhere else.

[soothsayer]

14. well, to be fair, Herb had promised us these bonuses before we took a dime

of gov't money

[MonkeyKnifeFight12]

16. In silicon valley...

I work in Silicon Valley and I don't know of any companies that are currently giving bonuses to high tech workers. And it's hard to argue that high tech engineers are of any less value than bankers who's greed drove our economy into the ground. I'm lucky that I even still have a job. These fucking bankers aren't brain surgeons. Anyone can learn what they can do it's just experience. They should all be ending bonuses. The day our schools want to give million dollar bonuses to keep excellent teachers i'll listen but let the fucking bankers quit I promise there are others looking to take their places.

Chris

[Zorra]

17. "First, we kill all the bankers." Shakespeare said "lawyers" in Henry VI,

but I'm sure he'd repharase it if he were alive today

[No Elephants]

19. That might depend upon whether Will was RW. If he was RW, he'd

still say lawyers.

Thanks for the reference, though. I thought it was Henry IV, but you are correct. It's Henry VI.

[gizmo1979]

18. Got my bonus yesterday.

A pink slip. Jerks.

[No Elephants]

20. We should never have bailed out Fannie and Freddie. We should have de-privatized them. What they do

is SOOOOOooooo not rocket science. It's very suited to bureaucrats and they don't get bonuses.

These bonuses for 7600 employees average out to over $19K per employee, but many of the 7600 probably got a thousand or less and the top folk got a fortune. For what?

[On the Road]

21. Right, It's Probably a Reasonable Amount

for the lower- to mid-level managers. The top is probably disproportionately rich.

Fannie and Freddie are not quite as outrageous. Their failure was due more to the industry and other institutions than their own actions. Being in the secondary mortgage business, they didn't write all those bad loans or make any sales at all for that matter.

[Cass]

22. $159 million in bonuses sure sounds like rewarding poor performance to me.

It sure isn't a demerit for cripes sakes.

It still blows my mind that these companies are doling out mega-bonuses to people who screwed up so badly the fed had to bail their sorry asses out. Why retain people who ran the company into the ground? Where is the logic in that?

And how the hell can any company remain profitable when it has an overhead like this? This is beyond crazy.

[spooky3]

23. obviously they CAN'T remain profitable

one of the thing that stuns me about these decisions is why it hasn't occurred to any of the managers: "We can't AFFORD these high compensation rates (anymore (?)). We don't HAVE THE MONEY."

Many organizations have laid off employees, frozen salaries, stopped hiring people even where there are clear needs, etc., because they can't afford to do otherwise and survive. Why the Wall Street and FM/FM managers think their orgs. shouldn't have to play by the same rules is probably key to understanding why they are losing money. This isn't the only thing that they don't "get."

Every household has to say no to certain decisions to stay within its budget. Business, non-profits, etc. are no different.

[Cass]

24. You summed up my thoughts on this perfectly, spooky.

There is a big disconnect with these firms - they don't operate in reality.

[spooky3]

26. agreed!

:hug:

[unkachuck]

25. "...plans to pay an additional $159 million in bonuses..."

....you went to work everyday and you've worked hard, you've played by the rules, you've been financially responsible yet somehow you're now suffering much hardship because of this economic crisis caused in no small part by Freddie and Fannie....

"Poor performance and at taxpayer expense do a lot of damage to public confidence and support for the economic recovery effort."....and system!

....there is no doing it 'right' in capitalism; everyone ultimately gets fucked....just some get fucked more than others....