If you receive a healthy bonus this year, keep it quiet. Joe Public is baying for blood, and bankers are on the hit list.
Last week, Germany’s finance minister blamed ‘snooty’ bankers for creating the credit crisis. According to Peer Steinbrueck, the current predicament is all down to bankers who thought they were cleverer than everyone else, but have turned out not to be.
British parliamentarians appear to share Steinbrueck’s convictions, if not his choice of language. Reuters reports that when senior bankers assembled to explain the credit crunch and the Northern Rock debacle the lawmakers accused them of ‘losing sight of risks, of failing to do enough to explain complex products to investors and of acting recklessly…’
It’s a view that’s already widely shared by the average non-banking type (or at least several I’ve spoken to), and it’s liable to become more pervasive if the credit crunch becomes a recessionary splat. According to the website Gawker.com, there have already been protests outside Goldman Sachs in NY (although it’s not immediately clear whether these had anything to do with the credit crunch).
What can be done to sidestep the coming missiles? Now may be the time to hone a few counterarguments of your own. Michael Lewis, the ex-Salomon banker and author of Liar’s Poker, wrote a tongue in cheek column for Bloomberg back in September, in which he argued the sub-prime crisis was all down to ‘poor people’.
Alternatively, one US banking analyst I spoke to recently argues that the current situation is the fault of lazy Europeans who want to retire early: “They were the ones who went after the high returns offered by sub-prime backed CDOs so that they could fund their retirements,” he claims.
Neither of these arguments is likely to make you many friends, particularly if you happen to be touting the latest in 10k watches while you make them. Unless and until you can think of a more palatable alternative, the best bet might therefore be to keep a low profile – and pretend your bonus really is as small as some are predicting it will be.