Interesting little run in that I\’ve been advised of.
This piece, about an analyst who got fired. One reader of both this blog and that paper wrote to Mr. English and pointed out that such firings are an inevitable consequence of the diminished bonus system.
Bonuses are variable pay: when there\’s not much work about, no bonuses. Thus jobs are kept because base pay is low: this is very much the German system of avoiding unemployment which everyone thinks is so lovely. Short time working on lower pay when there\’s not much to do.
Ban bonuses, insist on the bonus portion of pay being reduced, up go base salaries. Up go fixed costs and thus slow times lead to firings, not just non-payment of bonuses out of profits that haven\’t been made.
A reasonable point to make to a City journo, no?
The response from said City journo?
Thanks for your note.
I am clearly a foolish journalist.
Then again, I am new to this.
That is the way to suck up to your core readership, the City, isn\’t it?
I find his second part of the column fun too:
This begs a question: Which bunch of reckless fools lent them all that money in the first place?
The answer is the usual one: bankers. Now their ridiculous risk has gone bad, they stomp around demanding repayment and insisting that a default, or anything that results in them not being repaid in full, would be some kind of calamity, both fiscal and moral.
What? The banks are the ones going around saying that a default is inevitable. That\’s why they\’re trading the bonds at 50% of par you ignorant cretin.
It\’s the politicians desperately trying to avoid a default, not the bankers.
Note to the Standard: you really should bring back Christopher Fildes to train your City newsroom before it\’s too late.