Taleb Nassim: Eliminate banker bonus

Andy Nguyen

Andy Nguyen

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Taleb, known for creating controversial among the finance audience, has a opinion piece on NYT where he calls for an end to bonus in finance. What is your opinion?

It’s time for a fundamental reform: Any person who works for a company that, regardless of its current financial health, would require a taxpayer-financed bailout if it failed, should not get a bonus, ever. In fact, all pay at systemically important financial institutions — big banks, but also some insurance companies and even huge hedge funds — should be strictly regulated.

http://www.nytimes.com/2011/11/08/opinion/end-bonuses-for-bankers.html
 
If bankers don't make bonus, then they're making about 80k a year. They're also working about 80hr weeks, say 50 weeks a year. That's 20$/hr for a very high stress job. No way that's fair; nobody would become a banker.
 
Making finance a vocational profession would cut out some excesses and drive away a fair deal of money-driven profiles. On the other hand, some form of free capitalism is going to be sacrificed that way. Will the average Joe Blogger benefit from that? In my humble opinion, he will.

I am afraid to add that it is probably too late to regulate the sector, simply because the ever increasing balance between growth & consumption, which propels free markets and finance, is unattainable and unsustainable.
 
euroazn said:
If bankers don't make bonus, then they're making about 80k a year. They're also working about 80hr weeks, say 50 weeks a year. That's 20$/hr for a very high stress job. No way that's fair; nobody would become a banker.
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Under the scenario, base salaries would have to rise. Obviously.

Maybe less people wanting to be bankers is a good thing. Maybe it will separate those that actually know why they want to do it other than 'make money'.
 
How about: no financial institution (or any company for that matter) receive any sort of taxpayer-financed bailout, ever.
 
DanM said:
How about: no financial institution (or any company for that matter) receive any sort of taxpayer-financed bailout, ever.
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It won't work man! We have been living in a crisis mode only because Lehman wasn't bailed out! Imagine a permanent crisis! :D
 
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