Please to be explaining this one to me from the Financial Times...
In recent days, lawyers for the nine banks that received the government funds held talks over how to respond to calls for pay restraint from Congress and state regulators, according to people familiar with the situation.Let's say I have $100 and the government bails me out with another $100 and says, "You cannot spend this on booze." But then let's say I spend $100 on booze, saying, "I used my own money."
The companies – Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JPMorgan Chase, Merrill Lynch, Morgan Stanley, State Street and Wells Fargo – said they would not spend public money on compensation, the people added. Wall Street executives say that banks will pay bonuses from earnings and existing cash resources, like in previous years, and use the government capital for acquisitions and to replenish their depleted balance sheets...
The banks declined to comment on the conference call. Wall Street executives say that after one of the worst years for the industry, average bonuses will be down sharply this year.
However, they argue that they will still have to pay substantial compensation to star bankers and traders in order to avoid a brain drain from the industry into rival sectors such as private equity and hedge funds.
Did I follow the instructions of my benefactor?
For crying out loud. I think we can afford to let these folks go, or live on a few billion less in bonuses.