Reports this week indicate that Kenneth Feinberg, the Obama administration's pay czar, has a darkly comic definition of "tough love." While Feinberg reduced overall cash compensation for the top earners at American International Group (AIG) by a healthy 63%, a closer look reveals that the insurance company's high-ranking employees are still pulling down the kind of eye-popping annual pay you might expect from a successful business.

Continue reading Is AIG's Chief Executive Really Doing a $3 Million Job?

Is AIG's Chief Executive Really Doing a $3 Million Job? originally appeared on BloggingStocks on Thu, 25 Mar 2010 14:20:00 EST. Please see our terms for use of feeds.

Continue reading Kenneth Feinberg Tries Desperately to Stay Relevant

Kenneth Feinberg Tries Desperately to Stay Relevant originally appeared on BloggingStocks on Tue, 09 Feb 2010 10:20:00 EST. Please see our terms for use of feeds.

In an upcoming interview with Judy Woodruff on Bloomberg Television, executive pay czar Kenneth L. Feinberg complains that "The biggest disappointment, I think, is that under the statute my jurisdiction is so narrow, and so circumscribed, that I have no real direct mandatory power over other Wall Street or other national companies."

Which is, to be honest, terrifying.

Continue reading Pay Czar Complains of Lack of Authority in Setting Executive Pay

Pay Czar Complains of Lack of Authority in Setting Executive Pay originally appeared on BloggingStocks on Wed, 06 Jan 2010 18:00:00 EST. Please see our terms for use of feeds.

Kenneth Feinberg of the U.S. Treasury Department is the point man who reviews salaries at firms which received bailout money.

His latest move was to cap the compensation at four financial firms: Citigroup Inc. (C), American International Group (AIG), General Motors Corp. (GRM) and GMAC (GMA). The pay structures affect 28 through 100 highest paid employees. Compensation is capped at $500,000.

Continue reading Pay czar caps salaries at $500,000 for bailed out firms

Pay czar caps salaries at $500,000 for bailed out firms originally appeared on BloggingStocks on Sat, 12 Dec 2009 12:20:00 EST. Please see our terms for use of feeds.

During the past year, there's been no shortage of discussion about executive pay at American International Group (AIG) -- and the deluge continues. CEO Robert Benmosche reportedly threatened to walk last month over frustrations with the Obama administration's pay caps, but was persuaded to stay by the company's board.

Apparently, Benmosche's maneuver inspired five other AIG execs to issue similar threats, with the group warning last week that they might walk if pay czar Kenneth Feinberg gets too handsy with their compensation packages.

Continue reading Pay czar may cave after AIG execs threaten to quit

Pay czar may cave after AIG execs threaten to quit originally appeared on BloggingStocks on Tue, 08 Dec 2009 11:30:00 EST. Please see our terms for use of feeds.

Price's salary was trimmed to $500,000, retroactive to Nov. 1. He earned a salary of $800,000 for 2008, according to a separate filing submitted in March. He'll also get $5.3 million in stock awards, which is actually an increase from what he received last year.

Continue reading What exactly is the pay czar accomplishing?

What exactly is the pay czar accomplishing? originally appeared on BloggingStocks on Mon, 30 Nov 2009 10:40:00 EST. Please see our terms for use of feeds.

While Timothy Geithner gets deservedly raked over the coals for handling the America International Group (AIG) "negotiations" with kid gloves, federal officials are pressuring executive pay czar Kenneth Feinberg to ease pay restrictions on the company for the year 2010.

The concern is that tight pay restrictions, while politically popular, might hurt AIG's ability to attract and retain competent people -- thereby putting the taxpayers' long-term investment in the company at even greater risk.

Continue reading Pay czar Feinberg pressed to ease AIG pay restrictions

Pay czar Feinberg pressed to ease AIG pay restrictions originally appeared on BloggingStocks on Tue, 24 Nov 2009 13:00:00 EST. Please see our terms for use of feeds.

A few lucky executives at Citigroup (C) received base pay raises this year, but CEO Vikram Pandit isn't among them. The bank announced that it will compensate Pandit exactly $1 for his services, with no stock salary. Last year, the chief executive collected a modest salary (by Wall Street standards) of $958,333.

Meanwhile, Chief Financial Officer John Gerspach's base compensation was hiked from $400,000 to $500,000 effective Nov. 1. James Forese, co-head of global markets, enjoyed an even heftier pay raise -- his base salary jumped from $225,000 to $475,000.

Continue reading Citigroup CEO Vikram Pandit to rake in $1 salary

Citigroup CEO Vikram Pandit to rake in $1 salary originally appeared on BloggingStocks on Wed, 18 Nov 2009 11:20:00 EST. Please see our terms for use of feeds.

Speaking at Bloomberg Washington Summit Friday, Steven Rattner, the former head of the government's auto task force, wasn't exactly in the mood for pulling punches.

Referring to his time overseeing the government involvement in the auto industry, he said that "They were some of the worst-run companies I've ever seen in my life," and said there was plenty of blame to go around, including unions and the companies' executives.

Continue reading Former auto task force chief calls GM one of 'worst-run companies' ever

Former auto task force chief calls GM one of 'worst-run companies' ever originally appeared on BloggingStocks on Sat, 14 Nov 2009 12:10:00 EST. Please see our terms for use of feeds.

The federal pay czar is doing his job. He's cutting enormous paydays for executives of banks and other institutions that took TARP money. That's as it should be. Those banks performed terribly. Several would have simply vanished if the government hadn't bailed them out. Since capitalism is all about rewarding risk and merit, these executives don't deserve extraordinary payments.

But there is a concern that investors need to think about. It has to do with the human side of this equation. Consider this: if you're an executive who has a contract that states exactly how you get paid and you meet those standards, you would expect payment. That's why there are contracts. You and your department may have been one of the few groups that contributed to earnings, helping mitigate some of the losses other departments generated. While you may feel a twinge of "team" spirit and be glad that you've helped, you don't feel it deeply enough to believe your contract should be violated.

Continue reading Comfort Zone Investing: TARP banks' executive brain drain

Comfort Zone Investing: TARP banks' executive brain drain originally appeared on BloggingStocks on Sun, 01 Nov 2009 10:30:00 EST. Please see our terms for use of feeds.

The five most senior General Motors (NYSE: GRM) executives, along with the 20 next highest-paid employees, are going to see their cash compensation fall $3.9 million (31%) on a year-over-year basis.

The decision was made by the "independent master" that was appointed to set pay and stock levels for those in charge of companies that have received a majority of the funding from the federal government. GM is not on its own, as top execs at GMAC (the company's financing arm) and Chrysler will see their compensation cut as well.

Continue reading GM executives have their pay cut by the government

GM executives have their pay cut by the government originally appeared on BloggingStocks on Fri, 23 Oct 2009 11:30:00 EST. Please see our terms for use of feeds.

There are chills spreading across the executive suites in Corporate America. As seen with the latest from the U.S. pay czar, there will be 50% pay cuts -- on average -- for 175 executives of firms that received federal money.

Might this spread like a virus?

It's too soon to tell. However, there has been a refuge; that is, private equity. Right?

Continue reading TPG coughs up $20 million in fees. Huh?

TPG coughs up $20 million in fees. Huh? originally appeared on BloggingStocks on Thu, 22 Oct 2009 12:30:00 EST. Please see our terms for use of feeds.