Clawbacks Coming

As more than a few Dodd-Frank aftershocks tremor about this week, none can be more important to the rank and file of Wall Street than potential bonus clawbacks.

Even though such clawbacks would not directly affect our typical WSO monkey, this is a pretty interesting topic for debate among The Street’s younger legions. Though most of you have your heads low to the grindstone and are only worried about getting to the next paycheck, your predecessors’ mistakes may wind up costing some of you more than a little bit on your climb up the ladder.

Much maligned FDIC Chairman Sheila Blair spoke the right words on the subject. The kind we need to hear from regulators and see in their own approach. The failure of government has been bigger than anyone else’s in the entire mess of the last few years and it seems like the Feds are getting their shit kickers laced up for a fight in guilt redistribution.

We need shareholders and creditors out there conducting their own due diligence and asking the tough questions of executives and management.

Where would Wall Street be if shareholders and creditors started doing their own due diligence? Better hope that day never comes, monkeys. Though the clawbacks in question can realistically only hit a few big fish, a reverse trickledown effect can easily be predicted.
If their bonuses suffer, so will yours...you can bank on that.

I am curious what some of you guys think and have to say. Especially knowing the vast majority of you have either just entered or are entering the industry.

How much should you suffer financially for something you took no part in?

How much do you think this will affect interest in investment banking amongst top college students?

Is there some proper way to balance between punitive and motivational measures vis-a-vis the bonus structure?