Posted on 12/14/2006 2:24:16 AM PST by alnitak
Jasper Gerard reveals how City high flyers will spend their £8.4 billion in bonuses
They make Chelsea footballers look socially disadvantaged. They are the galacticos of the City, the unacceptable wallets of capitalism, the merchant bankers who make other merchant bankers jealous.
Yep, Goldman Sachs. No wonder Champagne corks popped with extra fizz at the works party this week. The firm has just announced bonuses of £8.4 billion, greater than the GDP of many countries.
Its 26,000 toilers will typically find, nestling with tangerines in their Christmas stocking, bonuses of £320,000; it has been rumoured that 25 Goldman stars have competed this "B day" to break records by cracking the $50 million barrier.
Among them is Driss Ben-Brahim, who looks about 12 but reportedly earned £37 million the previous year. Goldman very firmly plays down both claims. No matter, sales poppets at Tiffany, Ferrari and Rolex are wearing extra ingratiating smiles this yuletide; their trinkets can be had with loose City change.
"Last year, Goldman's big guns competed to buy the best helicopter or boat," says a former Goldman high flyer. "This year it will be football clubs. Bonuses really are that big."
One rumour is that Goldman has appointed a bonus counsellor to help these poor folk cope with stress from managing such large sums. Well, remember the Goldman swank who didn't notice his secretary dipping into his account to the tune of £3.3 million.
But if 2006 is a golden year – profits up 70pc – glitter is out. Even though the City in general and Goldman in particular is infinitely richer than in the Eighties, memories of that ostentatious excess still haunt the bank.
If bankers grow boastful on the Christmas party circuit it is likely to be for how much they give, not get: Bill Gates is the role model, not Lambo-driving, cigar-chomping masters of the universe. Jim O'Neill, chief Goldman economist, is chairman of a charity called Shine and many, like Gavyn Davies, aspire to public service.
Yet the former high flyer dismisses this as spin. "If you go out from Goldman and spend £30,000 on a bottle of wine and it is written about in the papers, that will be frowned upon. If you spend £60,000 and it is not leaked to the papers as you have gone to a discreet restaurant, that's fine."
Discretion is key. "The guys buying a red Ferrari with his bonus almost certainly won't work for Goldman," says one employee. "That will be some junior from a lesser firm. These bonuses won't make any difference to the elite earning monster bonuses. They won't go on spending sprees; they have everything they want." Another insider says: "If you look in the Goldman car park there might be the odd Porsche but also secondhand Hondas, Minis and Smart cars.
Whether Goldman has found guilt, or even decent PR, even some hardened capitalists feel queasy about these latest bonuses. Still, this record year reflects London's emergence as the world's financial centre.
To the City, bonuses are incidental expenses, such are the fortunes it has pulled into Britain. Without it there would be little left of our economy. Buoyant house prices in the capital's smarter postcodes and Sloanier counties are attributed to City bonuses (to the consternation of those further down the property ladder).
One Goldman-ite is buying a new house for £5 million and keeping his old one as an investment. Another banker is paying a "ridiculous price" for a flat in Chelsea's Onslow Square.
Stratstones of Mayfair, an Aston Martin dealership, says it has a long list of orders "but all are on hold until it is known how big bonuses will be," says Chris Calabrese, head of sales. "For some it is a whim; others say 'I haven't got that model in my collection'. It's a wonderful world."
City tastes are growing more sophisticated. Art prices have soared on City purchases. Visiting Christie's last week I was struck by the wall of chalk stripe. And while some buy Picassos by the yard, others – several at Goldman – have an eye for Brit Art.
Such wealth costs. We have been introduced to the phenomenon of the "extreme worker": those for whom office is home, who keep a wardrobe behind their desk and who, when occasionally bumping into a spouse, murmur a "I recognise your face from somewhere". Well, Goldmanites are at the extreme end of extreme.
When a female friend dumped her Goldman boyfriend, he couldn't take it in. "Why?" he kept asking. "Because," she replied. "I see more of Aunt Hilda than you. And she has been dead five years." Typically my friend was asleep when lover boy got home and would still be asleep when he left for work.
Another Goldman widow books hourly slots. "I've lost count of the number of times I've been stood up in restaurants." Divorce rates are high. "Goldman guys are always travelling," says a rival. "The poor wife is left at home while he is probably getting a bit of extra entertainment."
And while you might earn oodles, you will also spend it. One who has escaped says: "Now I live in the country I am amazed how little I spend. Working for Goldman you have so little time you end up paying people to run and live your life for you."
However, some might struggle to summon sympathy. "One Goldman partner has an island off the coast of Scotland," discloses a senior City figure. "He has a fleet of helicopters and flies up there. The other day he was refused credit for fuel. He had to ring Peter Sutherland to sort it." Sutherland is chairman of BP.
Yet our high flyer leaves us with a sobering thought worthy of F Scott Fitzgerald: "When you are called in and told 'We are going to give you $5 million', you feel really great. Then you feel really empty: why has that guy who is bloody useless got the same? Many can't walk away because they love the money for its own sake. So they just collect houses around the world they will rarely visit."
Consolation, I guess, for those whose Christmas bonus barely stretches beyond a mince pie.
Agreed.
It's the kind of job you do in your twenties, when you are full of ambition and anxious to conquer the world. After a few years of big bonuses, people tend to leave places like Goldman to go work for more sedate firms.
"You can do anything you want for 8 hours a day, Goldman expects you in the office for the other 16. Grounds for termination if you miss more than an hour a week for 3 weeks of your first 14 weeks. Few actually get their 8 hours away anyway.
Move up the ladder and the hours start to actually get intense. "
This is not out of the ordinary for most people who have started businesses.
Doesn't seem to be much constructive purpose to it. No endangered species saved and thriving ... no weak, innocent people defended .... no recycled/synthetic substitutional materials developed to preserve animal habitats....no tyrranical regimes overthrown...no exploration of space and discovery...no eco-factory WorkCo-ops funded to preserve American or British jobs...
Oh well, maybe the 'nouveau riche' will be happy with more vehicles, jewelry, sexual partners and realestate. Their politics probably incline toward what we politely call 'libertarian' i.e. 'mercenary,exploitative, and degenerate', so let's hope they don't fund much of that.
I wonder how this story is going to play on the Al Quaida/ AlJazeera news service.
Oh well, maybe the 'nouveau riche' will be happy with more vehicles, jewelry, sexual partners and realestate.
Oh boy, not even the same ballpark. This is legacy money, the kind of money that insures comfort, education, and well-being for several generations into the future.
Looks like Paulson who left a job making 38 million as CEO of Goldman Sachs for the platry salary as head of the Treasury last May was a good investment for his cronies.
And to think, Exxon was investigated. Something is rotten on Wall Street. Maybe time for vote for a populist.
These are the people who actually run the country - the politicians just do what they are told.
You needn't be. Money doesn't buy happiness. To wit, as quoted therein:
Then you feel really empty: why has that guy who is bloody useless got the same? Many can't walk away because they love the money for its own sake. So they just collect houses around the world they will rarely visit."
Thanks AC!
I think that being married through school, especially advanced studies, would be quite difficult. One working a career like that, while the other is in school would be especially difficult.
I'm hoping that I will be able to work full-time (usually 2 weeks on, 2 off) on the North Slope in Alaska. I will likely spend time there, but am based in Anchorage initially. If I meet someone, we'll see how those plans change!
Actually it seems money does buy happiness.
http://www.livescience.com/othernews/050406_money_happy.html
Capitalism at it's finest.
this is the structure of the US economy. people was swap paper all day, make insider deals, make fortunes. and you can tune into any thread regarding General Motors on FR, and see people demonizing autoworkers trying to hold onto a $60-70K wage.
I don't eant to hear about how much time they spend at work. anyone, even entry level people now, who work in IT - are tied to pagers and cellphones for their jobs, 24x7.
you know how many of these types screw NYC out of the income tax - they live in NYC apartments, but declare their residents at their other homes in the suburbs or out of state, to skip out on the income tax.
Yup.
A lot of "country homes" are primary residences.
But look, NYC saw this Wall Street thing coming more than 20 years ago when the manufacturing jobs went buh-bye. The city bet big on Wall Street and media, now it's paying off.
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