Transcripts

"Two Ways to Play"-Kevin Depew of Minyanville

SUSIE GHARIB: There's a lot of controversy these days over huge bonuses going to the top brass at the nation's big banks. So tonight's "Two Ways to Play" tackles the question, exactly what do you mean by bonus? Here's Kevin Depew of Minyanville and Minyanville's Kevin Depew.

KEVIN DEPEW, EXECUTIVE EDITOR, MINYANVILLE.COM: With the financial crisis now well into its second year, Americans have good reason to be angry about the culture of risk taking behavior on Wall Street and about the excessive bonus compensation of bankers. There's something wrong with this system where someone on Wall Street earned more in one year than many Americans will in a life time. In most industries, bonuses are paid out of the profits, while on Wall Street they are paid out of revenues, revenues generated by our bailout funds. We've reached a point where the disconnect between Main Street and Wall Street has crossed the line from bizarre to offensive. The current debate over Wall Street bonuses is missing the point. The argument right now that it's about bonuses when it should be about cash bonuses. From that standpoint, there's actually an easy solution to this pay debate. Simply put, there should be no cash bonuses this year. All bonuses should be in the form of equity, which doesn't vest for at least three years. Give the bankers equity and then let's see how the so-called recovery unfolds. If the bankers are right and we're recovering, then they should be thrilled to be getting cheap stock right now. If they're wrong, then hey, welcome to our world.