In 2008, the world was on the verge of collapse due to a prolonged period of obscurity in the world of banking. TARP ended up saving numerous banks from turning belly up, and discipline was promised. Meanwhile, that very year of the subprime debacle, the financial firms that were the most significant recipients of the federal bailout money, paid 5000 of their traders and bankers bonuses of more than 1 million apiece.
Wells Fargo, who has had a disastrous year reported that Chief Executive Officer Timothy Sloan made $17.6 million last year. From the creation of over 2 million fake bank accounts to paying $50 million to settle charges after overcharging hundreds of thousands of homeowners you have to wonder, why would the CEO get a 36% raise?
Just slightly after Wells Fargo publicized its pay figures, Reuters reported that the bank could very well face more punishments due to forcing customers into auto insurance they didn’t need.
It seems that these big banks internally feel that if they ever experience operational turbulence, they will automatically get bailed out by the feds.
Keep in mind, the CEOs at the top 20 American banks claimed nearly $253 million in taxpayer benefits between 2012 and 2015 for executive bonus and stock options:
One can only hope, the rapid adoption of alternatives such as cryptocurrencies can finally disrupt one of the oldest but most powerful industries in the world, banking.
