NY gov sees Wall St losing up to 40,000 jobs

[UpInArms]

Source: Reuters

NEW YORK (Reuters) - New York Gov. David Paterson on Monday said Wall Street might lay off 40,000 workers in a worst-case scenario following Lehman Brother's bankruptcy filing and problems at other big financial firms.

Paterson, speaking a news conference where he also noted the impact of Bank of America's surprise agreement to purchase Merrill Lynch and problems threatening insurer American International Group, said the impact of the financial sector's downturn may not be known for months or even years.

The Democratic governor at the news conference also announced plans to aid American International Group, allowing the insurer access to $20 billion of its own capital, staving off a liquidity crisis.

Paterson, who said he would not put any taxpayer dollars at risk, said his efforts to shore up AIG focused on clearing the way for the New York-regulated company to shift money to its parent company from its insurance subsidiaries. The transaction will serve as a bridge loan.

<snip>

Bankers, brokers and traders earned an average salary and bonus of $340,312 a year in 2006, according to James Brown, a labor market analyst with the state Labor Department

Read more: http://www.reuters.com/article/bondsNews/idUSN1526900520080915?sp=true

[Warpy]

1. Most of those guys thought it would last forever, too,

and are even deeper in hock than the average suburbanite in a McMansion.

Yeah, I can feel sorry for them, young guys whose peak earning period occurred before they hit 30 and know those good times will never come again.

[sarcasmo]

2. Greed, it couldn't happen to a nicer bunch of folks.

No more BMW, no more fancy suits, I will shed no tear.

[Pale Blue Dot]

3. The problem is the ripple effect.

All of the average people who served these assholes lunch, dry cleaned their clothes, parked their cars, etc., they're all going to lose their jobs too.

People focus on the fat cats, but this is one instance where "trickle down" really does apply.

[Skittles]

4. correct

the little people always suffer the most, too

[trthnd4jstc]

6. Your right. The Trickle Theory holds little water, but in these cases absolutely.

Economic Recession is horrible. This is why I believe in a Democratic Socialist System, and end so-called Free Market Capitalism. The Economy is more important than what 10% of the people, or even 35% of the people should control. The Economy is as important as 100% of the people. We need to end the war against all socialistic thinking. A mixed economy is superior to free market capitalism. Free Markets are good in theory during boom times, but hellish during busts.

Peace to All!

[tinrobot]

5. Wrong answer.

The vast majority of people losing their jobs will be the lower and mid level employees of these companies - people who take the train to work from Long Island and New Jersey. I doubt the people in BMWs will be hit as hard, and I don't think that 40,000 people losing their income is good for anyone.

When 40,000 people lose their jobs, it affects a lot of other people. Those 40,000 people will stop spending in their communities, and those communities will start to suffer as well. The ripple effect will be felt far beyond Wall St.

No reason to rejoice.

[Tansy_Gold]

8. Well, then, I guess we'd better keep proppin' up Wall St.

:sarcasm:



This is what happens. It's shitty. It's ugly. It's unfair. But if the only way to save the jobs of the little guys is to continue robbing from them (taxes) to support the fat bastards, which is worse?

Ain't capitalism beautiful?


:sarcasm: just in case anyone wonders.




Tansy Gold

[unblock]

11. thanks for the effort :)

as one of those low- and mid-level employees on wall street, i appreciate the sentiment, even as i acknowledge that it's a lost cause on this board. for some reason many people think wall street is full of nothing but republicans, even when they stop and think that wall street is in new york, which is full of liberals; and even when they understand that most companies have liberal democrats working the line with republicans working in positions like sales and management....

[WriteDown]

20. It's amazing isn't it?

Everyone seems to think that every single person working on Wall Street is making 300K per year. You see the same attitude towards union workers who many seem to believe are making "too much money" and have "too many benefits." I just can't be happy when any people are losing their jobs. Can't jump for joy for the HP or Ebay announcement either. Doesn't help any of us.

[unblock]

22. right. the problem is rarely the company; it's the way the company is run

and the way compensation is distributed among stakeholders.

[customerserviceguy]

12. It was just redistribution

Where do you think the money came from to pay those assholes $300K a year for pushing a few computer keys, and producing nothing in the process? It came from millions of the rest of us, trying to see if we can get by on $30K a year, or less. We no longer need the magnificent 19th Century edifice of Wall Street any more than we need a big fancy bank with an ostentatious lobby in order to pay our bills. The whole thing can be handled by secured computer servers, regulated electronically.

Or am I just ahead of my time, here?

[Lost4words]

21. Its ALL connected, thats what I have been saying for years.

former IT professional here, we got dumped early on and nobody seemed to mind much.

If Im not working I cant spend, its that GD simple.

8643

[WriteDown]

23. Apparently...

you were making TOO much money so you deserved to suffer :sarcasm:. I am outraged at all of these job losses and not just the the ones at minimum wage.

[AwakeAtLast]

7. They're gonna be surprised when they can't get a job picking lettuce for $50/hr.

:shrug:

[jakem]

19. you know, i was feeling kind of sorry for them, but you are right-

i have at least as much of an education as most of those people, and i am still scraping by at 'below-lettuce' employment.

sorry wall street, join the rest of us unfortunate bastards.

:shrug:

[GreenTea]

9. A drop in the bucket, just another days work for the republican job destroying machine....

I'm sure there will be a lot of white collar Wall Street greedy republicans scratching their heads in the unemployment line....But only for six month's dudes then your on your own....to continue voting for what, more corporate fascist republican deregulation ideology?

[madrchsod]

10. they did`t feel sorry for all the people they helped to fuck over

and i can`t feel all that sorry for them.....

[libodem]

13. 25,000 jobs to be cut from Hewlet Packard

world wide.

[Purveyor]

14. NY Governor Allows AIG To Use $20B Of Subsidiary Company Assets To Stay In Business

Source: Associated Press

CHARLOTTE, N.C. (AP) - American International Group Inc. will be allowed to use $20 billion of assets held by its subsidiaries to provide cash needed for the troubled insurer to stay in business, New York Gov. David Paterson said Monday.

The move comes as AIG reviews its operations and discusses alternatives with outside parties, reportedly including Warren Buffett's Berkshire Hathaway Inc., to shore up its business amid concern the world's largest insurer could need billions of dollars to strengthen its balance sheet.

Paterson asked New York state insurance regulators to essentially allow New York-based AIG to provide a bridge loan to itself. The governor has also asked the head of New York's insurance department to talk with federal regulators about providing an additional bridge loan to AIG.

"AIG still remains financially sound," Paterson said.

The move will allow AIG to use those assets as collateral to borrow cash to fund its day-to-day operations, Paterson explained.

It also helps AIG by "giving them what they need most, which is time," said Keefe Bruyette & Woods analyst Cliff Gallant, who added that the relaxation of insurance regulations is "unprecedented."

Typically, a state insurance commissioner's priority is to protect the policyholder, and that includes making it very difficult for an insurer to access the funds that are used to pay claims.

AIG could face significant claims from Hurricanes Ike and Gustav, which have battered the Gulf Coast. But "AIG is a big company, and I would expect they will be able to meet their claims," Gallant said.


Read more: http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D937DA2O1

[hedgehog]

15. You know, I have no idea whether this is a good idea or a bad idea,

but I guarantee that John McCain and Sarah Palin have no idea, either!

[Blaze Diem]

16. Key statement: I would expect they will be able to meet their claims," Gallant said.

'would expect', but then that's kinda like saying maybe they will or maybe they won't be able to...

[Blaze Diem]

17. This gives them what they need most..Time..umm sure. That's what Lehmen

said also.
How much time did they have before they rolled over dead?
A week? maybe two?
Whole thing should be shoved up McShame's nose.

[lapfog_1]

18. Time only matters if it allows you to find the bottom

and start to rebound.

Suppose the bottom is months or years away?

Someone had a chart of ARM resets expected and posted it here... as I recall it doesn't max for another 6 months to a year and continues for another year beyond that (massive resets).

If the bulk of your exposure to risk is sub-prime AND NOW PRIME mortgages (because even those credit worthy types are losing their jobs too)... then you need to buy yourself about 2 to 3 years to ride this sucker out.

Or am I just totally misremembering things?