Tuesday, November 11, 2014

$280 Million in Federal Reserve Money Falls Into PIMCO Employee Wallets

I tell you it is salary increase crazy here on the West Coast. Yesterday, I reported some anecdotal evidence of the easy pay raises in the San Francisco Bay Area (SEE: San Francisco Bay Area on Brink of Hitting All-Time High for Employment). Now comes word that southern California-based PIMCO is about to launch an “enhanced compensation program”.

To be sure, the program has been instituted in the wake of the departure of Bill Gross, to hold on to staff, but PIMCO still needs to have these kind of funds on hand to make the payments.

The initiative will cost about $279.45 million through mid-2017, parent insurer Allianz SE said today.

Under the new plan, Pimco will make so-called “special performance awards” in addition to normal 2014 year-end compensation.

The bonuses will be awarded to staff members that are senior, but below managing director level, and will be paid out over 12 to 30 months.


  1. Former Goldman Banker Reveals The Path To The Next Depression And Stock Market Collapse

    But, the recent timing here is key. Banks only started buying US Treasuries in earnest when the Fed announced its tapering plans. Thus, not only are they participants in the ZIRP game as recipients of cheap money, they are complicit in effecting monetary policy. As the data analyzed so expertly by Bill Moreland at www.BankRegData.com makes clear, there has been no taper. Thus, the publicized reason for tapering – better job and economic growth – is also bogus.

    During the third quarter, Wells Fargo and Bank of America matched Fed purchases of US Treasuries, keeping the total amount of US Treasuries in QE land neutral. With such orchestration to keep rates down and the prices of US Treasury securities up, all the talk about whether the labor force is strengthening or inflation exists or not is mere show. Banks haven’t even propped up the labor market in their own industry. They chopped 11,400 jobs last quarter. In the past two years, they cut 57,236 jobs.

    No one in either political party mentioned any of this during the mid-term elections. Yet, our political-financial system has gone from the dysfunctional to the failed to the surreal. Speculation, once left to individuals and investors, is now federally sponsored, subsidized and institutionalized. When this sham finally buckles and the next shoe falls and rates do eventually rise, the stock market will tank, liquidity will die, and the broader economy will plunge into a worse Depression than before. We are not there yet because of these coordinated moves and the political force behind them. But we are on a precarious path to that inevitability.


  2. Hey, when you can pocket the profits and pass the losses onto the taxpayers, you can't lose. Pay raises for everyone! On the house!