ONTD Political

With smaller Wall Street bonuses, one-percenters say they feel the pinch

1:59 pm - 03/05/2012
With smaller Wall Street bonuses, one-percenters say they feel the pinch

Andrew Schiff was sitting in traffic in California after giving a speech on gold at an investment conference. He turned off the satellite radio, got out of the car and screamed a profanity.

“I’m not Zen at all, and when I’m freaking out about the situation, where I’m stuck like a rat in a trap on a highway with no way to get out, it’s very hard,” said Schiff, director of marketing for broker-dealer Euro Pacific Capital.

Schiff, 46, is facing another kind of jam this year. Paid a lower bonus, he said the $350,000 he earns, enough to put him in the country’s top 1 percent by income, doesn’t cover his family’s private-school tuition, a Kent, Conn., summer rental and the upgrade they would like from their 1,200-square- foot Brooklyn duplex.

“I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.”


The smaller bonus checks that hit accounts across the financial-services industry this month are making it difficult to maintain the lifestyles that Wall Street workers expect, according to bankers and their accountants, therapists, advisers and headhunters.

“People who don’t have money don’t understand the stress,” said Alan Dlugash, a partner at accounting firm Marks Paneth & Shron who specializes in financial planning for the wealthy. “Could you imagine what it’s like to say, ‘I got three kids in private school. I have to think about pulling them out?’ ”

Facing a slump in revenue from investment banking and trading, Wall Street firms have trimmed 2011 discretionary pay. At Goldman Sachs and Barclays Capital, the cuts were at least 25 percent. Morgan Stanley capped cash bonuses at $125,000, and Deutsche Bank increased the percentage of deferred pay.

“It’s a disaster,” said Ilana Weinstein, chief of IDW Group. “The entire construct of compensation has changed.”

Most people can only dream of Wall Street’s shrinking paychecks. Median household income in 2010 was $49,445, lower than the previous year and less than 1 percent of Goldman Sachs chief executive Lloyd Blankfein’s $7 million restricted-stock bonus for 2011. The percentage of Americans living in poverty climbed to 15.1 percent, the highest in two decades.

Comfortable New Yorkers assessing their discomforts is at least as old as Edith Wharton’s 1905 novel “The House of Mirth,” whose heroine Lily Bart said “the only way not to think about money is to have a great deal of it.”

Wall Street headhunter Daniel Arbeeny said his “income has gone down tremendously.” Executive-search veterans who work with hedge funds and banks make $500,000 in good years, said Arbeeny, declining to discuss his income. He said he no longer takes annual ski trips to Whistler, Tahoe or Aspen.

On a recent Sunday, he drove to Fairway Market in the Red Hook section of Brooklyn to buy discounted salmon for $5.99 a pound. “They have a circular that they leave in front of the buildings in our neighborhood,” he said. “We sit there, and I look through all of them to find out where it’s worth going.”

He reads other supermarket circulars to find good prices for his favorite cereal, Wheat Chex.

“Wow, did I waste a lot of money,” Arbeeny said.

Richard Scheiner, 58, a real estate investor and hedge fund manager, said most people on Wall Street don’t save.

“When their means are cut, they’re stuck,” said Scheiner, whose hedge fund, Lane Gate Partners, was down 15 percent last year. “Not so much an issue for me and my wife, because we’ve always saved.”

Scheiner said he spends about $500 a month to park one of his two Audis in a garage and at least $7,500 a year each for memberships at the Trump National Golf Club in Westchester and a gun club. A Labradoodle named Zelda and a rescued bichon frise, Duke, cost $17,000 a year, including food, health care, boarding and a daily dog-walker who charges $17 each per outing, he said.

Still, he sold two motorcycles he didn’t use and called his Porsche 911 Carrera 4S Cabriolet “the Volkswagen of supercars.”

Scheiner pays $30,000 a year to be part of a New York-based peer-learning group for investors called Tiger 21. Founder Michael Sonnenfeldt said members, most with a net worth of at least $10 million, have been forced to “reexamine lots of assumptions about how grand their life would be.”

He described a feeling of “malaise” and a “paralysis that does not allow one to believe that generally things are going to get better,” listing geopolitical hot spots such as Iran and low interest rates that have been “artificially manipulated” by the Federal Reserve.


The malaise is shared by Schiff, the New York-based marketing director for Euro Pacific Capital, where his brother is chief executive. His family rents the lower duplex of a brownstone in Cobble Hill, where his two children share a room. His 10-year- old daughter is a student at $32,000-a-year Poly Prep Country Day School in Brooklyn. His son, 7, will apply in a few years. “I can’t imagine what I’m going to do,” Schiff said. “I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.”

The family rents a three-bedroom summer house in Connecticut and will go there again this year for one month instead of four. Schiff said he brings home less than $200,000 after taxes, health insurance and 401(k) contributions. The closing costs, renovation and down payment on one of the $1.5 million, 17-foot-wide rowhouses nearby, what he called “the low rung on the brownstone ladder,” would consume “every dime” of the family’s savings, he said.

“I wouldn’t want to whine,” Schiff said. “All I want is the stuff that I always thought, growing up, that successful parents had.”

M. Todd Henderson, a University of Chicago law professor who’s teaching a seminar on executive pay, said the suffering is relative and real. He wrote two years ago that his family was “just getting by” on more than $250,000 a year, setting off what he called a firestorm of criticism.

“Yes, terminal diseases are worse than getting the flu,” he said. “But you suffer when you get the flu.”

Dlugash, the accountant, said he’s spending more time talking with Wall Street clients about their expenses.

“You don’t necessarily have to cut that — but if you don’t cut that, then you’ve got to cut this,” he said. “They say, ‘But I can’t.’ And I say, ‘But you must.’ ”

A Wall Street executive who made 10 times that amount and now has declining income, along with a divorce, private-school tuitions and elderly parents, also suffers, he said.

“These people never dreamed they’d be making $500,000 a year,” he said, “and dreamed even less that they’d be broke.”

--

My icon says everything I want to say. Cry me a frickin' river.
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rex_dart 5th-Mar-2012 07:53 am (UTC)


13chapters 5th-Mar-2012 07:55 am (UTC)
all my cries for these assholes.
eridaelectric 5th-Mar-2012 07:57 am (UTC)
They "feel" the pinch? What, did they have to give up their summer home by lake Tahoe? Or maybe they sold their 5th vehicle?

fuck the rich.

“I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.” If I were drinking something, I might have choked. Un-fucking-real.

Edited at 2012-03-05 08:02 am (UTC)
roseofjuly 5th-Mar-2012 04:21 pm (UTC)
This reminds me - sort of OT, but I work at a university where at least half the students grew up quite wealthy by absolute and relative standards (but not surprisingly, most of them consider themselves to be middle-class). One of my students walked into my meeting with a fur coat on the other day. A real frickin' fur coat. Another mentioned casually to me the other day that it was really nice her family was moving to Boston because they would be closer to their house in Cape Cod. I really try to temper my reactions when these things happen, but I kind of want to burst out laughing sometimes.
curseangel 5th-Mar-2012 07:59 am (UTC)
skellington1 5th-Mar-2012 05:32 pm (UTC)
Who is this gif?

He looks disturbingly like my *mumblemumble third or second or something* cousin.
astridmyrna 5th-Mar-2012 08:02 am (UTC)



Oh no, actually...
Photobucket
paulnolan 5th-Mar-2012 08:07 am (UTC)
Well I for one really feel for them.


...




...






...no, couldn't keep a straight face.
bloody_vixen 5th-Mar-2012 08:12 am (UTC)
“I can’t imagine what I’m going to do,” Schiff said. “I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.

gangsterdorothy 6th-Mar-2012 02:10 am (UTC)
lol aka my life
lovedforaday 5th-Mar-2012 08:15 am (UTC)
oh those poor job creators.
tiddlywinks103 5th-Mar-2012 08:18 am (UTC)
Aw, my Give A Damn's all busted.

Go fuck yourself, and sell your summer home, dickwad.

“I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.”

HAHAAHAHHAHAHAAAAAAARGGGGGGGGGGGGGGHHHHHHHHHHHHHHHHHHH!!!

Edited at 2012-03-05 08:22 am (UTC)
mirhanda 5th-Mar-2012 09:17 pm (UTC)
Photobucket
omimouse 5th-Mar-2012 08:19 am (UTC)
. . . right. Keep talking guys, maybe you'll piss off enough of the rest of the voters that we can finally tax you fuckers at a reasonable rate.
mirhanda 5th-Mar-2012 09:18 pm (UTC)
Hehehe this!
ultra_obscene84 5th-Mar-2012 08:26 am (UTC)
BRB looking for all the fucks to give about them and their 'struggles'....







Nope. There are no fucks for me to give. Welcome to the real world, jackasses.
scolaro 5th-Mar-2012 10:19 am (UTC)
It's not even the REAL real world, it's just a less cushy part of the fantasy world he's already living in.
hinoema 5th-Mar-2012 08:29 am (UTC)
“I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.”

LOOK AT YOUR LIFE, LOOK AT YOUR CHOICES.
hera_bearrra 5th-Mar-2012 08:54 am (UTC)
These people are so ungrateful. I can't, seriously.
raised_eyebrows 5th-Mar-2012 08:31 am (UTC)
Oh please. Things will get better for them soon enough. They always do.

Also, what the fuck: “People who don’t have money don’t understand the stress”. I have no words. None. Actually, yeah I do. People who don't have money understand stress in a way that you never will asshole. They may not understand what it's like to not be able to afford all of these luxuries that you have to give up because they would never even dream they could afford half the shit you took for granted, but you should really be thankful that you'll never be in their shoes.

Edited at 2012-03-05 08:34 am (UTC)
xyrisquint 5th-Mar-2012 08:35 am (UTC)
That line actually had me laughing... It seriously reads like an article from the Onion.
hera_bearrra 5th-Mar-2012 08:52 am (UTC)
He lost me at, “People who don’t have money don’t understand the stress.”
kyakki 5th-Mar-2012 09:26 am (UTC)
I for one, am totally willing to learn what his troubles are like.

I expect him to report at 6 am with a stack of cash so that I, too, may learn how to somehow survive on a measly 350k.

In the meantime, he can enjoy the freedom and stress free existence of a salary that is 1/14 the size of that, pre-tax and without any bonuses.

(Lj - why you keep doing me wrong with your weird formatting and overlaying comment stuff? I hope they fix this, trying to comment is a pain if I do not switch to my own style first D:)

Edited at 2012-03-05 09:29 am (UTC)
riath 5th-Mar-2012 08:52 am (UTC)
Oh you poor sod, you having to do your dishes by hand! /sarcasm

I've done my dishes by hand every single damn day for the last 8 years since I moved away from my parents. so STFU!

“People who don’t have money don’t understand the stress,” said Alan Dlugash, a partner at accounting firm Marks Paneth & Shron who specializes in financial planning for the wealthy. “Could you imagine what it’s like to say, ‘I got three kids in private school. I have to think about pulling them out?’ ”

Don't understand the stress, don't understand the effing stress?! Fuck you douchebag, the last few years I've been sitting here wondering with my necessary bills going up how much I can stretch my food budget so my husband and I can have enough to fucking eat this month. If all you have to do is pull your brats out of private school you've got it fucking lucky asshole.
roseofjuly 5th-Mar-2012 04:25 pm (UTC)
I think we've only had a dishwasher at one of the nine homes I lived in as a child, and it was the very last one. By then I had such a disdain for dishwashers that even when I am someplace that has one, I wash them by hand. They get cleaner that way, IMO.
stellar_kar 5th-Mar-2012 08:54 am (UTC)
I JUST CAN'T

they do realize there are families who literally go without food/electricity and are even fucking homeless and they're bitching about their summer homes and having to wash dishes by hand.
UN FUCKING REAL
kiri_l 5th-Mar-2012 08:54 am (UTC)
Scheiner said he spends about $500 a month to park one of his two Audis in a garage and at least $7,500 a year each for memberships at the Trump National Golf Club in Westchester and a gun club.
That's where I choked. Literally choked. Not the parking.. I get the parking.. the memberships.. even gold plated..w t f.

A Labradoodle named Zelda and a rescued bichon frise, Duke, cost $17,000 a year, including food, health care, boarding and a daily dog-walker who charges $17 each per outing, he said.
Good for the dog walker (they should charge more) My guys have never even approached that (and I have 3) even with emergency vet bills (oy those rack up the $ fast!) And they do have premium vet prescribed food, and excellent vet care. We even have pet fountains. What are you feeding them.. GOLD DUST? Otoh my guys do not have such. names.

Still, he sold two motorcycles he didn’t use and called his Porsche 911 Carrera 4S Cabriolet “the Volkswagen of supercars.”
... uh *uses the Bambi rule*

Scheiner pays $30,000 a year to be part of a New York-based peer-learning group for investors called Tiger 21. Founder Michael Sonnenfeldt said members, most with a net worth of at least $10 million, have been forced to “reexamine lots of assumptions about how grand their life would be.”
*abandons Bambi rule* (sorry Thumper) You're idiots. Sheer and utter idiots. Grand my aunt fanny. Your paying way too much for something that ain't worth a hill of beans.. and you obviously don't know any better. How and why anyone is paying you anything should be the real question.

*stalks off seriously unimpressed*
homasse 5th-Mar-2012 09:37 am (UTC)
It is literally beyond my comprehension how they spend $17,000 a year on two dogs. I just can not grasp it, at all. I can not imagine what they could possibly be spending on those dogs that cost that much.
ajremix 5th-Mar-2012 09:27 am (UTC)
Oh, stop whining. Obviously if you can't afford nice things, you're not allowed to have them. And if you wanted them badly enough, then get yourselves some goddamn bootstraps.

(my amusement at the irony very nearly drowned out the rage until i remembered these guys are serious)
lizzy_someone 5th-Mar-2012 09:39 am (UTC)
Uhhhh, come back to me when you can barely afford to feed yourself, to keep one roof over your head, to obtain necessary medical care. Come back when your kids' schools are falling apart, when you catch pneumonia because you can't afford to heat your home (the way my friend's parents did), when one tiny misstep or misfortune is effectively catastrophic. Until then, shut the everloving fuck up about your vacation homes and personal dogwalkers, mmkay?
mirhanda 5th-Mar-2012 10:14 pm (UTC)
Yeah, I'd like to talk to him about finding a lump in your breast and not even bothering with a mammogram because you know even if it is cancer you wouldn't be able to afford the treatments anyway, so there's just no sense in finding out for sure.
homasse 5th-Mar-2012 09:58 am (UTC)
What.
atomic_joe2 5th-Mar-2012 09:58 am (UTC)
Aww diddums. Hang on let me get Bono and Bob Geldof on the phone and organise Banker Aid. Oh we already did, bailing them out to the tune of trillions.
fynoda 5th-Mar-2012 10:11 am (UTC)
Flawless gif. Right click save as.
angi_is_altered 5th-Mar-2012 10:42 am (UTC)
Photobucket
evilgmbethy 5th-Mar-2012 11:05 am (UTC)
shorofsky 5th-Mar-2012 11:27 am (UTC)
I'll see if I give a fuck in 9 years when my combined salary for the 14 years I will have worked by then (provided I don't lose my job or whatever) will reach approx. $500,000. Yeah. I bet I won't have many fucks to give then, either. What a screwed up world these people live in.
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