The days of outrageous Wall Street bonuses may be limited, depending on your definition of outrageous, of course. A recent Bloomberg story reported that Morgan Stanley, the owner of the world's biggest brokerage, is capping cash bonuses at $125,000 and is deferring more compensation for senior level executives.
According to Bloomberg, the decision came after a fourth quarter that some analysts predicted was the worst for investment banking and trading since the financial crisis in 2008. Last year companywide compensation and benefits rose 6% to $12.7 billion as revenue climbed 13%.
This is the latest news of how the financial crisis is beginning to catch up with Wall Street. Last year we heard announcements from UBS, Citigroup, Morgan Stanley and others that they are planning significant layoffs.
What's your take on bonuses at investment banks? Will we see more caps in the future, or will investment banks have to become more stingy in other areas?
