The Sky is Not Falling on Wall Street $38 Billion in Bonuses are!

Real Estate Agent with Compass

Wall StreetDespite all the gloomy headlines and serious fallout from the sub-prime mortgage business, according to Bloomberg News Wall Street bonuses this year are estimated to be $38 billion, even greater than last year.

Many shareholders in stocks have lost money this year, but the increase bonus pool comes from investment banking fees from M&A and underwriting IPO's despite the losses from subprime mortgages. Goldman Sachs is reporting record profits, they hedged subprime losses with a short strategy.

The bonus money is split among about 186,000 workers at Goldman Sachs, Morgan Stanley, Merrill Lynch, Lehman Brothers and Bear Stearns.

The average $201,500 bonus on Wall Street is more than four times the $48,201 median household income in the U.S. last year, according to U.S. Census Bureau statistics.

Wall Street bonuses again this year will fuel the Manhattan real estate market. The winter and spring should be very strong.

  • If you are a buyer on the fence, act now before you are competing with all the bonus money after the 1st of the year.
  • If you are holding off listing (selling) your apartment, get ready for January. The sky hasn’t fallen and the winter/spring market should take off again.

To all my friends and clients on Wall Street Congratulations and Happy Thanksgiving. If you're considering investing in Manhattan Real Estate now is a great time. There is a large variety of innovative new designs in luxury new construction, new conversions and resales in every Manhattan neighborhood for every lifestyle. 

Whether you're trading up, ready for your first home or want the perfect pied-a-terre, I look forward to helping you. Click the links to become a VIP Manhattan Buyer and start recieving listings or click VIP Manhattan Seller for a complimentary market evaluation of your home.

Mitchell Hall

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Kaushik Sirkar
Call Realty, Inc. - Chandler, AZ
I still marvel at how much $$ some of the wall street folks make.  Hey, if you can get it, then do it!  It is a capitalist society...
Nov 19, 2007 02:25 PM #1
Lizette Fitzpatrick
Lizette Realty - Richmond KY - Lexington, KY
Lizette Realty, Lexington KY MLS - Kentucky Homes
Sounds like some folks there where you live will have some extra cash to spend on new digs! Wish I were getting a bonus!  Hope you have a nice Thanksgiving! 
Nov 19, 2007 02:33 PM #2
Patricia Kennedy
Redfin - Washington, DC
Home in the Capital
Geez, and those are just bonuses!  And they're kids.  So you must be gearing up for January!  
Nov 19, 2007 02:33 PM #3
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Mitchell... there is a part of me that wants to rip into those bonuses. I believe in earning money... I believe in reaping the benefits and such.....  but in all honesty, are some of these bonuses justified, especially when so many others are holding the ....  well, holding the end of nothing. I guess it is true in what they say. The rich get richer.....

And Mitchell... sorry for sounding negative. But there have been way too many instances to where people high up or on the board pay themselves frivolous bonuses just because they can and not because they earned them.  It goes all the way back to ENRON.   You just wonder sometimes, what might seem legal might not be. Anyhoo... have a great Thanksgiving.    

jeff belonger
Nov 19, 2007 03:03 PM #4
Mitchell J Hall
Compass - Manhattan, NY
Lic Associate RE Broker - Manhattan & Brooklyn

Kaushik, It is amazing how much money is made on Wall Street

Lizette, Wish I were getting a bonus too, I would spend it on a new apartment, Happy Thanksgiving.

Pat, Just bonuses (the bonuses are more than the salaries for many and many are kids especially the hedge fund bonus babies.

Jeff, I understand your frustration considering what has been going on in the mortgage industry. I was expecting negative news. The Bloomberg article explains that the people at Merrill and Bear that were involved with the mortgage losses will be penalized. Bonuses are a major part of how they get paid.

I agree the people up at the top in every industry pay themselves huge amounts even though their companies and shareholders lose money under their leadership. I wish I got paid for all the apartments I didn't sell. lol 

``They're all going to have to fall into line,'' said Geisst, author of ``100 Years of Wall Street.'' ``If Bear and Merrill plead poverty, they're going to lose all of their good people.''

John Thain, Merrill's newly appointed chairman and chief executive officer, is already grappling with the bonus issue and he doesn't start at the world's biggest brokerage until next month. Thain, whose contract calls for him getting at least $44 million in cash and stock payable over five years, said top performers will receive bonuses while those involved in the subprime market collapse that led to the firm's $8.4 billion third-quarter writedown will be penalized.

Nov 19, 2007 10:40 PM #5
Laurie Manny
Long Beach CA Real Estate - Long Beach, CA
Mitchell, Great advice on getting out shopping early.  The best deals are made with less competition, sellers are more likely to make more concessions. 
Nov 21, 2007 04:20 AM #6
Mitchell J Hall
Compass - Manhattan, NY
Lic Associate RE Broker - Manhattan & Brooklyn
Hi Laurie, Happy Thanksgiving and thanks for stopping by. It is so true last year I got a buyer a really great deal in new construction on Christmas eve. By the time the place closed in the spring it appraised much higher then what she paid and the other units sold for much more. The developer even came up to me at the closing and said we didn't give any concessions to any one else.
Nov 21, 2007 04:41 AM #7
Lenn Harley
Lenn Harley,, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland
Give them the bonuses if they produce the profits for their employers.  There surely is a lot of money floating around up there.
Nov 21, 2007 06:25 AM #8
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