Goldman Bonus Babies Cry Over Still-Ridiculous Compensation

It couldn't have happened to a nicer group of economic parasites. Goldman Sachs GS, the investment bank/probable criminal cabal, announced this week a reduction in bonuses by nearly 9% — a rare "no" from the parent company to its spoiled, overpaid children. In a world with nearly 20% unemployment and underemployment, the nerve of Goldman Sachs GS bankers to complain over "only" an average bonus of $237,662 per employee is pretty outrageous. It takes a special person to get angry over a bonus that represents more money than an average American will earn in several years of middle-class living. Considering the nonsense that Goldman engaged in, leading to the collapse of the entire world economy while triggering a recession from which we have not really recovered, getting angry about a bonus cut is not going to play well on main street. Oh, did I mention that the only reason Goldman Sachs still exists is because our government, in its infinite wisdom, violated the basic tenets of capitalism to bail them out from their terrible investment decisions. But then, no one can really claim that we're a capitalist society anymore, can they? Not when banks get to keep all profits (can't tax the wealthy!) but get to socialize the losses among the taxpayers of the country. Meanwhile, America crumbles. $237,662 bonus? That's salary for four teachers. I would take four new teachers over one more Goldmanite, suckling at America's teat. Not that there is really any difference between government employees and Goldman Sachs. The treasury department of both the Bush and Obama administrations reads like a who's who of Goldman employees. Left off in the bonus discussion is any indication as to WHY the bank employees would deserve a bonus. Goldman missed earnings significantly, coming in at $1.85 instead of the predicted $2.27. Revenues were similarly bad, at $7.28 billion instead of the estimated $8.14 billion. Not to worry, Goldman folks. You can be knee-deep in caviar soon enough, as Uncle Ben Bernanke is ready to ride to the rescue. His third rendition of a quantitative easing plan will inflate assets and drive commodity prices skyward. You'll be well positioned to swoop in and profit off the speculation, once again proving that you are, in fact, the Anti-Christ. Oh, and you'll be the one selling treasury bonds to the Fed. ACTION ITEMS:

Bullish:. Declining comp costs are bullish for shareholders, but the problem is that revenues are down as well. The comp pool has fallen from 49% to 50% of revenue to 44% of revenue. This is good for shareholders. Traders could consider getting long GS as the stock is trading at a 52-week low.

Bearish:. Goldman is headed in the wrong direction. Trading revenues are way down and the bank continues to be plagued by scandal and headline risk. Traders could consider shorting GS and MS based on Goldman's lackluster earnings report today.