With the details of wall street ? don't you say you know what, i cannot make this up, the truth is a much better than the fiction?
Well, it is endlessly fascinating, as we all know.
Jamie dimon, the chief executive of jpmorgan, is going to get paid more, reportedly paid more or whatever it is, -- where there is smoke there is fire.
How is it possible that when you are not risking your own capital, i understand you are risking a lot of other people's capital, but if you're not risking your own capital on a daily basis, how come you get compensated at a level that implies that you are risking everything that you have worked for?
You like that at 8:00 something in the morning.
This is a very interesting topic obviously.
The first point is that if you were to sort of poll ceo's and hedge fund guys and private equity guys around town, you would they do the blue risk their own capital, you know, the bill ackman, the dan loebs of the world, carl icahns, they are the ones getting paid, you know, 500 million dollars a year, $1 billion a year.
Right, so jamie dimon, who got paid what, $13 million last year -- $11.5 million.
Ok, a down year for him.
This year it will we closer to something like that, we all scratch our heads as to why if you are paying $22 billion in fines.
You know, that is, frankly -- it isn't, but for the guys who kind of -- are in the hedge fund world -- it is a lot of money.
It is chump change, and that's what you get paid if you are managing to hundred thousand people in a complex business.
It is easy to see why they pay him that much because he has made them the investors, the shareholders to the extent that they are active in that that she has made them a lot of money.
And they think of them as the best ceo on wall street, and if they do not pay him enough, he will go somewhere else.
He is an exception.
First of all, where are they going to go?
It is not there are thousands of companies that will pay that kind of money.
A jamie dimon to go into private equity and make more than that.
On the flipside, you could say who else out there is as qualified as jamie dimon to run jpmorgan?
Look, betty, as de gaulle said, the graveyards are filled with indispensable men.
So jamie dimon seems indispensable, and he has made himself and is visible -- i am not saying he is indispensable -- there are plenty of people and there will be people to run jpmorgan after jamie dimon.
They will say jpmorgan will be $100 a share stock.
They came in and 2004, 2005. now we are in the mid 50's. did he deliver on his promise?
That is an open question.
He is always the very qualified to run a firm idlike jpmorgan.
R> this segues into is there a brain drain.
Goldman sachs is cutting their bonus pull down.
Does that mean they are losing the best people you go it jpmorgan pays jamie dimon less, does he go somewhere else?
To pimm's point, exactly, you are not raising your own capital, there is no better job in the world and working on wall street.
Where else can you get paid even less than you get paid?
Even if goldman sachs cut its bonus pool, where is there anywhere you can get paid anything like on wall street not risking -- here are the numbers on it.
Goldman sachs in this last year, i believe the second lowest they, or the compensation ratio is the second lowest since they went public, but if you average it out, each employee at goldman, would still be owing -- earning about $300,000 a year, compared with the average american -- that is better than the nfl.
What if that have to do with anything?
What i am saying is in terms of -- what is that have to -- i am saying, compared to the average income of americans that $50,000 the year, you are -- and what the risks are you taking?
You are working long, hard hours, putting up with a lot of stuff, and it is relatively complex, but let's face it -- they don't have to do it.
You get paid very well.
Let's led to the idea of bonuses and the pay that is being talked about.
Matt, you brought up something inside you understand very well why they would pay the chief executive of jpmorgan such a sum, granted, but does that mean that that chief executive's compensation should only be tied to the share price and to the dealings of the shareholders?
Because in that case, you would say all right, there's nothing wrong with that, let the shareholders worry about it.
That is their problem.
He is their agent.
He works for the owners of the company.
And they have a banking license, and word is that banking license come from?
Are you going to get into too big to fail now?
let me get into too big to fail because you all saw the headlines about berkshire hathaway, warren buffett's company, they're going to a way whether berkshire is too big to fail.
Remember that berkshire is rated aaa, so -- and a great story by the way about jonathan weil who writes for blankfein "bloomberg view" about berkshire -- is this a story or nonstory?
It just makes berkshire hathaway more valuable in a sense because now, if the government says is "too big to fail congo that it will not fail.
Then investors and creditors will will even better about it than they already do.
If you get this tbtf license, then you can go out and buyput $1 billion on the ncaa bracket.
But you do set it, they have the license.
Who grants them the license?
Who owns the fed?
Other big banks only fed.
It has got the appearance of being owned by the american legal, but it is not.
Can we just disclose that since we have been talking about banks and jpmorgan, that you have a legal relationship with them that is adversarial at the moment.
That is true, does been fully disclosed, be my guest and go look and see what jpmorgan is trying to do to me.
They are suing you.
Price bill, you were in the middle of the lawsuit, and a still invited you to the jpmorgan conference.
They are making a frenemy out of bill.
Things -- stranger things have happened.
Anyway, bill, you are taking a look, as the company, it is not a bad mark, it is not a red mark to be considered to be to fail because that just means you will get bailed out by the government.
Look, you're going to be scrutinized anyway if you are a big financial institution by the government family.
You might as well have the too big to fail select creditors think that you are not going to default on your debt.
You spent a lot of time with warren buffett.
Based on your experience with him as a person, what do you think his reaction is to this news?
I cannot see for warren buffett, but i would assume he just rubs his shoulders.
He is the kind of guy that declares evil of derivatives and then makes huge bets on derivatives, right.
Matt, weight -- he is glad to take -- hate on, they are not huge bets.
$1 billion on the bracket?
You're talking about two separate things.
They're both derivatives -- you are talking but ensuring be quick and long bed and then saying that derivatives are weapons of mass destruction and he has been a part of underwriting those derivatives, they are very small, though, in proportion to the balance sheet.
Price right like -- like jimmy dimon's portion compared to carl icahn's. bill, do i've also been having a, starbucks said on digital.
This text has been automatically generated. It may not be 100% accurate.