We’re all too familiar with the story of layoffs on Wall Street and a hiring slowdown is clearly undeway. But even those who find new jobs will likely be stung by the the downturn on Wall Street. Wall Street compensation packages for new hires are expected to decline by as much as 20 percent, according to a survey of leading recruiters released today.

“Recruiters are in virtually unanimous agreement that compensation for new Wall Street hires will decline, although there is some disagreement as to the extent of the downturn,” according to specialized research firm smart cube.

More than 40 percent of recruiters surveyed expect compensation will decline by as much as 20 percent, while 22 percent expect the decline to range between 11 to 16 percent, smart cube’s research shows. About one-fifth of the survey’s respondents were less pessimistic, predicting a decline of less than 10 percent.

London will also take a hit. In fact, recruiters there are even more pessimistic.

“In addition to imposing layoffs, investment banks will only recruit new employees in areas where there are critical openings that absolutely need to be filled. With Wall Street unemployment steadily rising, the job market pendulum has clearly shifted in favor of employers,” says Omer Abdullah, the smart cube managing director who oversaw the survey.

Thank god, the money managers have weighed in and decided: A-Rod was entirely justified in opting out of the final three seasons of his contract with the Yankees. According to Daniel Alpert, a partner at Westwood Capital, a boutique investment bank in New York that specializes in mortgage and related securities, “there’s nothing cold blooded about it.” And what’s Balestra Capital founder James L. Melcher’s take on the situation? “Not only do I have no problem with it, I’m cheering him.”

Can you imagine what would happen if these guys didn’t stick together? When you’re trying to rip people off, the moral support of your peers really counts for a lot. (Investors in) Absolute Capital know what we’re talking about.

Rodriguez Not Greedy by Standard of Wall St. [NYT]

Delving further into its favorite class war between the Haves and the Have-Mores this weekend, The New York Times found that in Silicon Valley, people who are rich don’t feel rich compared to their very rich neighbors. And they’ll try anything—even working a whopping twelve hours a day—to move into that next tax bracket. You know, the one that will make them feel a sense of superiority and self-worth and raison d’être. Just like us (you)!

Yes, many members of this “digital elite” feel bad about themselves because they are “surrounded by people with more wealth—often a lot more.” One gilded geek, Gary Kremen, pouts, “It’s just like Wall Street, where there are all these financial guys worth $7 million wondering what’s so special about them when there are all these guys worth in the hundreds of millions of dollars.” Reminds me of this story Keith likes to tell about sitting in the steam room of the 92nd Street Y with an inconsolable Daniel Seth Loeb, weeping over the fact that he made $150 million last year, sure, who cares about that when James Simons is spending that much on cigarettes annually?

But lest you think you and your West Coast brethren are too much alike, the Geek Squad makes sure to point out a notable difference: they feel bad about it. Sure, talent played a role in their good fortune, but so did “being at the right place at the right time” and many feel “sheepish, even at times guilty about their piles of cash.” See, they’re just as obsessed with money and chasing the top one-tenth of a percent (if squarely in the top one percent), or the top one-one-hundredth of one percent (if in the top one-tenth of one percent) as you, but in Silicon Valley, they’re introspective and self-doubting and have issues about their stacks of gold. Sometimes they even cry about it (when was the last time you shed some salty discharge over your bonus? And not the “I feel bad about my bonus because I got screwed out of three extra zeros so I’m going to silently weep about it in a little locked room” kind).

Which begs the question: Is it better to be a rich prick who questions his/her rich prickocity or a Dealbreaker reader? (I love you people, I do).

In Silicon Valley, Millionaires Who Don’t Feel Rich [NYT]

Remember Lord Browne, the BP executive who parted ways with the oil company back in May because he got creative with the truth regarding his personal life in court, forfeiting an estimated £15m ($30 m) and, more importantly*, if we’re going to split hairs, his spot as a director at Goldman Sachs? He’s now had an addition £1.5m ($3 m) owed to him frozen by the oil wooly-haired mammoth, until a court case is resolved.

At issue is what a few shareholders believe was mismanagement (“draconian,” yes draconian now, cost cuts prior to a pipeline spill, etc) in Alaska. They are seeking unspecified damages from 39 current and former BP executives and directors. To be clear, this suspension of pay is only to facilitate the funds being turned over to the injured party (who believe it would be “difficult” to recover the money from the Lord) when and if the shareholders are successful, and has nothing to do with the gay witch hunt from earlier this year.

BP freezes payments to Browne [The Guardian]

*it’s never about the money.

There may be some tension in the NYSE Euronext cafeteria. Financial Times reports that Jean-François Théodore, the French John Thain (he’s like JT but wears a red smoking jacket and says ‘ménage à trois’ instead of ‘threesome’), i.e. chief executive of the Eurnoext, was paid less than a fifth of what Thain earned last year.

While Thain enjoyed a nice $9.36 million (€6.9m) paycheck, Théodore was awarded a measly €1.33m ($1.81m): barely enough to buy barely enough to buy a nice pair of frogs’ legs. Lest you chalk this up to an example of Americans working harder and taking less vacations (and paying for their health care) than Europeans, and being rewarded accordingly, note this: the Euronext was more profitable than the NYSE last year, with net profits of $504m versus a paltry $205m.

There’s a chance that Théodore will have an additional €200,000 thrown his way, following the Euronext’s shareholder meeting next week, if the board recommends that shareholders reward him for his “vital contribution” to the merger but at this point, we’d advise Theo (can we call him Théo?) not to accept anything less than $9.36 million (€6.9m). €200,000 is just insulting.

Théodore earns fraction of Thain at NYSE [FT via DealBook]

First: please continue to send us your projected bonuses. Second: not to bite the hand that feeds us, but where were you on this one, ladies? Bankers in Moscow making twice as much as their counterparts anywhere else? Including Goldman MDs? Industry recruiters tell Bloomberg that managing directors dealing with corporate mergers and stock/bond sales in Russia are earning $7 million plus a year, versus the 2-3 million that guys (and girls) doing the same work in New York are making.

Compensation rose 25% for bankers last year in Russia, on account of a 5-year oil boom, a record number of IPOs, and Russia’s place as the fastest growing major European economy. Goldman says it will double its Moscow staff to 70, Morgan Stanley to 100 (from 20). Interested in submitting an application? Securities firms are looking for “a combination of western experience and an understanding of the local conditions,” including but not limited to a vodka-specific alcohol problem. If you do make the move, there’ll be more than pogroms and long lines for bread in store for you.

Inside Moscow’s Garden Ring, bankers spend $7 million for a five-room apartment near the Bolshoi Theater, drop $350,000 for a Bentley at the car dealership next to Revolution Square, and rent private dining rooms at Turandot, a new $50 million two-story restaurant furnished in a late 18th century Marie Antoinette theme, complete with musicians in white wigs playing chamber music.

Who’s interested?

Moscow Bankers Get $7 Million Payday, Double New York Average [Bloomberg]

Ford revealed today in its annual proxy that Chief Exec Alan Mulally was awarded a $7.5 million hiring bonus and $11 million to “offset” the compensation he lost for leaving Boeing last year. This is an interesting bit of news, considering that the automaker hemorrhaged $12.7 billion last year. The previous CEO, Bill Ford, did not receive a cash salary, bonus, or stock awards, since he had decided in 2005 to make himself a martyr “a commitment…to forgo any new remuneration until the company’s auto unit made sustained profits,” which might’ve seemed like more of a HUGE sacrifice if his family didn’t…own the company (or a sizeable amount of it).

Another way to look at this is that when you’re basically just putting money in paper bags and lighting it on fire, $28 million is just a drop in the bucket.

We’re also pretty sure Alan’s one of those guys with an “Act As If” attitude, since a friend of a friend of a friend told us recently that AM preemptively sent a note to the board of directors expounding on this philosophy. He allegedly went off on a tangent for some time about how “if you want to save this company, I’m going to need some serious clams. I’m talking dollars. Big money, hoooo! You think if I show up in public dressed like a hobo, it’ll convince people that they want to drive a Ford? No, if anything, it’ll bolster their decision to buy one of those, what’s the word, what’s the word, what’s the word—Monopoly cars—a KIA or something. Personally, I drive a Beemer; don’t take that the wrong way, no offense to the brand, but, like I said, I’ve got to act like we’re just rolling in the money, and if we’re getting naked and rolling around on piles of $1,000 bills, that’s got to mean something. Don’t take that the wrong way—that wasn’t an invitation from me asking you guys to get naked and roll around on piles of money with me, or a come on by any means, just an illustration. Anyway, the money—I’m going to need a lot of it. I’m also going to need you to send a few extra-plush robes over to my office for the price of—on the house. ASAP. We’re going to save this company, together. –A.”

Mulally gets $28 mln amid $12 bln Ford loss [Reuters]

Apparently Lloyd Blankfein wasn’t reading Dealbreaker the day we clearly laid out a bunch of alternative ways for the Masters of the Universe to spend their bonuses, back in January (the acquisition of hornymantee.com, 2 million Jim Cramer bobblehead dolls, an all-access pass to the Andrew Ross Sorkin Pleasure Palace, and so on and so forth). Radar reports that the old boy has purchased a $41 million home in Southhampton (which apparently retails for such a sizeable chunk of change because it comes with a name: “Old Trees”), on First Neck Lane.

Spread out on 10.6 acres, the estate boasts a clay tennis court, an ocean-view swimming pool, 13 bedrooms, a “cottage” (with its own pool) and a “barn” for entertainment. Stephen Schwarzman couldn’t be reached for comment, because he’s in the midst of planning a surprise hostile takeover of the property. On a related note, Tom Hudson has just agreed to go in on a summer share in hell.

Sachs’ CEO Drops New Money on ‘Old Trees’ [Radar]

John Mack, like the Tom Arnold of investment banking (take a second on that one), has overcome huge odds to fight his way back to the top of his game.** Last year, the Morgan Stanley chief, who was shown the door in 2001, received a raise of 38% to take home $41.4 million, reports CNN Money. The package was comprised of a base salary of $800,000, $36.2 million in restricted stock, $4 million in other stock options, miscellaneous compensation of $15,447, $67,963 in pension benefits, $6,100 in matching 401(k) money and, perhaps most importantly, in the parlance of our times, use of the company jet valued at $321,848.

Earlier: How Goldman’s Managed To Stay Out Of The Backdating Scandal

Morgan’s Mack sees hefty pay raise [CNN Money]

**Rocky seemed too easy and we thought it was about time we—Carney—went public with our feelings for Carpool.

Is it too early to start talking about bonuses for 2007? Bear Stearns doesn’t think so. It has already set up a bonus pool for its top executives, according to a recent SEC filing.

From Reuters:

A maximum bonus pool of $165 million has been established for a group of five senior executives that includes Bear Stearns Chief Executive James Cayne, the company said. Payout will be pegged to the company’s return on equity. No executive can get more than 30 percent of the total pool, which can be as little as zero.

Bear Stearns’ compensation committee also approved the performance goals for a second bonus pool for seven other top executives. The maximum amount will be $140 million, with awards based on pretax return on equity, departmental income and expense controls.

These numbers include cash and non-cash bonuses. So if you do the math, the maximum bonus for, say, James Cayne for 2007 will be $49.5 million, or about $3 million dollars less than the co-presidents of Goldman Sachs got for last year.

We can’t help thinking that this suggests a new recruiting slogan for Bear Stearns: “Bear Stearns: It’s like working for Goldman in 2005. Wall Street The Old Fashioned Way.”

Bear Stearns Companies Inc 8-K [SEC]

Bear Stearns sets up $305 mln executive bonus pool [Reuters]

Yesterday we told you that the reason for the Dubya’s visit to Wall Street was two-fold: to create the illusion that he’s done something besides screw up in Iraq and post admirable poll ratings, and to inconvenience those of you in need of caffeine. Apparently there was another reason he hopped on the Acela from Washington Wednesday morning: to shame business leaders for shirking their responsibilities to dole out appropriate salaries and bonuses to C.E.O.s. Though there was no heckling (except from Nardelli, but he always heckles), Bushie’s instructions to “pay attention to the executive compensation packages that you approve” and to make salaries and bonuses commensurate with the “C.E.O.s…success at improving their companies and bringing value to their shareholders” was reportedly met with “silence.” (A point of contention: was the lack of laughter due to bitterness at the idea that the president might be leaving them penniless, or shock over having a guy who’s not yet mastered the riding of a bike or the swallowing of a pretzel, let alone the running of a country, give a lecture on earning one’s keep?) Though he took a shot at the Dems’ plans for legislation that would require shareholder votes on pay packages (saying he didn’t think the government should get involved), he made sure to praise the Securities and Exchange Commission, commenting, “I appreciate the fact that S.E.C. has issued new rules to ensure that there is transparency when it comes to executive pay packages…the print ought to be big and understandable.” Like, you know, the font size and reading level they might use in the Hardy Boys series, or maybe even them See Spot Run books.

Why Did Bush Step Into C.E.O. Pay Debate? [NYT]

…every corporate executive and his mother (and her mother) taking the company jet on unauthorizedish jaunts? Todd Thomson, sure, he needed some privacy a few thousand feet above ground to seduce the $Honey, that we get. But what about everyone else? Like, for instance, Applebee’s former CEO Lloyd Hill? In a letter to the chairman of Applebee’s International’s (APPB) compensation committee, CEO Douglas Conant, from Richard C. Breeden (obtained by footnoted.org), DC is informed of the error of his “free rides for everyone” ways:

On 29 occasions from April 2006 through January 2007, Applebees’s corporate aircraft flew into and out of Galveston, Texas, where former CEO Lloyd Hill happens to own a beach house. The nearest Applebees’s restaurant is more than 40 miles away. Though Mr. Hill ceased to be CEO in September 2006, company planes continue the Galveston shuttle.”

We do not believe that shareholder interests are served by turning corporate aircraft into flying limousines for senior executives’ personal vacations. Just as importantly, this practice is inconsistent with the wholesome “neighborhood values” that Applebee’s claims to embody as a company. I am quite certain that most Applebee’s customers would be shocked to find out that a portion of the cost of their meal goes to fly the former CEO back and forth to his beach house aboard a corporate plane.

Allowing someone to fly the company plane to his beach house when he doesn’t even work for the company anymore is one thing, but bucking Applebee’s “wholesome neighborhood values”? That a portion of the $9.99 that Bob Loblaw is shelling out for his Fiesta Lime Chicken™ is paying for? That is just wrong, my friend. This is why Applebee’s is on the decline.

(NB: footnoted asks in a P.S.: “Just imagine if some other folks started digging into corporate flight logs — now that would make for some interesting proxy reading. In fact, this sounds like a great wiki-project for footnoted.org readers. Anyone interested in helping to pull this together?” Obviously we’re huge fans of FN and read it daily but here’s a question—what in god’s name do you think the point of this is? Our own personal amusement?)

A day at the beach…[footnoted.org]

We think Ben Stein did but we’ve got water in our ears from this morning’s dip in the pool so it’s hard to say for sure. Anyway, for those who did inquire, Andrew Ross Sorkin and Co. have the answer: go private. Apparently that was the consensus in Switzerland this past week. According to the attendees of a symposium that included people who sound like bigwigs (Pagliuca of Bain Capital, Weinberg of Perella Weinberg, Rosen of Lazard) in Davos on Thursday, private equity will “account for 26 percent or more of the M&A market in five years,” on the heels of this past year’s 20% of M&A’s being represented by private equity. Why?

The ability to pay enormous pay-for-performance packages without an outcry from public shareholders.

According to one pseudonymously named “Buyout King”:

“If one of my C.E.O.’s made $100 million, I’d say that’s great because it means that we probably just made $2 billion.”

What is unacceptable for a public chief executive becomes a powerful incentive in the private sphere.

So there you have it: go private, and shut Ben Stein up.

(There are naysayers, of course, John Thain chiefly among them, who claims “all these ‘going privates’ will soon be ‘going public’ again.” But his word has been, shall we say, fishy, of late).

A Growing Aversion to Ticker Symbols [NYT]

Ben Stein had a nice little article on Sunday in which he recounts hearing a Jefferson Starship song on the radio, feels compelled to “put on [his] swim trucks” (a visual we could’ve dealt without but appreciated nonetheless), goes for a dip in his “superheated pool” and “looks up at the stars.” While splashing around in the water he starts to think about his life—his “wonderful” wife, his son who’s the “handsomest son on the planet,” his “glorious” homes, his “great, super” parents, his kick-ass game show, his starring roles in the Visine Clear Eyes commercials, those recurring spots on Charles in Charge, etc, etc. All of the gleaming (egomaniacal, probably exaggerated) superlatives, he credits to capitalism. It was because of capitalism that his parents, Eastern European Jews (represent!), could make money “as individuals according to contract,” not “according to the statues of [their] birth.” The senior Steins’ accumulation of wealth then set the ball in motion for junior Stein to go to law school, get rich, marry what sounds like a pretty hot wife, and afford the cost of an equally attractive sperm donor from which the “handsomest son on the planet” sprang forth, buy the huge house with the “superheated pool” and so on and so forth.

But the more laps he swims, the more Stein starts to get angry— really angry (and not just because the water temperature has dipped to an uncivilized 72°). So angry that he starts to talk about “yeoman farmers” and “hammers” and “granite foundations” (though we’re pretty sure that can be chalked up to the drugs). Capitalism, Stein posits to the handful of people who recognize him outside of “Bueller, Bueller,” can only thrive in the presence of trust. When there’s no trust, there’s no capitalism, and when there’s no capitalism, there’s no “superheated pools” or hot wives or handsome sons or recurring spots on Charles in Charge. All there is are lukewarm pools and mildly attractive but nothing to write home about wives and so-so looking sons and blink-and-you-miss-it bits on, we don’t know, Moesha. And you know who’s to blame for this lack of trust? Stein does:

When I see what the top dogs at all too many corporations are now doing to that trust, I feel queasy. Outrageous—yes, obscene—pay.

You know who should also be held accountable? Washington. They’re all “crooks” there, too. No, if we don’t crack down on thieves like Jobs and, you know, liberals, and fast, you know what’s going to happen? Stein’s going to lose money, he’s going to have to downsize to an aboveground pool; and in order to keep his wife in the lifestyle she’s become accustomed to, he’s going to actually have to take those walk-ons on Moesha.

Greedy backdating of stock options, which in my opinion is straight-up theft. Mangers buying assets from their trustors, the stockholders, at pennies on the dollar, then forestalling competing bids with lockups and insane break up fees.

You see? Already preparing for the worst.

(We’re not saying we agree or disagree with Stein’s anger over corporate greed, thievery, etc, etc—taking actual stances on issues always comes back to bite us in the ass. But maybe next time he should orate from a place other than his “superheated pool”—his gold plated double-wide shower, perhaps?—if he wants people to “feel [his] pain.” Otherwise, it just sounds like BS, BS. Not that there’s anything wrong with that).

The Hard Rain That’s Falling on Capitalism [NYT]

Bonus numbers for the upper reaches of Wall Street executives are coming in. Or at least the best guesses about those numbers. Yesterday Charlie Gasparino reported that his sources say 50 individuals at Goldman were looking at bonuses in excess of $25 million, and that twelve indivuals at each of Morgan Stanley and Merrill Lynch would get that much. This morning the New York Post reports on the most exclusive bonus club of them all: the chief exectuvies. Bonuses are expected to put them over the $40 million mark.

As news spreads of Lehman Brothers boss Dick Fuld’s $186 million, 10-year payout, Wall Street’s top five chieftains are on track to rake in a combined $200 million in 2006, awash in cash from record trading profits.

Profits at Wall Street’s leading firms are up an average 15 percent across the board from last year’s record levels. So are their stock prices, with even Morgan Stanley - the scene of a bitter, multi-month executive rebellion in 2005 - up more than 28 percent year-to-date.

Executive recruiters and veteran Wall Street pros told The Post that there was little doubt that for the chiefs of Goldman Sachs, Merrill Lynch, Lehman Brothers, a $40 million payday is a distinct possibility.

“I think it is safe to say that this year, most of the leading [Wall Street] CEOs will see their pay in the $40 million or above range,” said a veteran Wall Street executive recruiter.

Of course, the most underreported story right now are the bonuses of Wall Streeters farther down in the ranks. Don’t forget to send bonus rumors to tips@dealbreaker.com. Thanks.

Fat Cat Parade [New York Post]

Every now and then when you get too enthusiastic about the ability of activist hedge funds and private equity to reign in abusive C-levels, it’s good to remember stories like this. Sometimes even the smart money gets taken to the cleaners.

The chief executive installed by agitating hedge funds to run BKF Capital Group was among the senior executives to get a fat severance package to walk away from the carnage at the once high-profile New York money manager.

BKF, which was de-listed from the New York Stock Exchange Nov. 1, recently announced that its financial condition was so grave that the chief executive and financial officers agreed “to voluntarily resign” to “conserve cash.” The Rockefeller Center-based firm filed papers with the SEC that shows there’s plenty of cash left for generous exit packages.

Departing CEO John Siciliano - hired with fanfare in the summer of 2005 - is getting a $950,000 severance payment. Better still, he will receive $300,000 for as yet unspecified “certain consulting services.”

CFO J. Clarke Gray will also get a $400,000 cash severance and collect a $183,000 yearend bonus for 2006.

CKF Chutzpah [New York Post]

“By any objective measure, Barry Diller is grossly overpaid,” said Jonathan Weil, managing director of Glass Lewis tells the New York Times today. The story is about Barry Diller, the highest paid executive in America.

Some say he’s paid $85 million. Others say it’s $295 million. So what’s the real deal? Basically, Barry Diller is paid more money than anyone can count.

Diller Takes the Prize for Highest Paid [New York Times]

Forget what you hear about it being to late to get into venture capital. People will tell you that, having missed the glory days of 1999, there’s no point in going into it these days. They’re full of it. In fact, they’re probably venture-capitalists themselves and just want to keep you out of the competition. The Wall Street Journal today reports that pay for V.C.’s shot up 35% this year. And this was supposedly a rough year for venture capital outfits.

Pay for venture capitalists is up 35% this year, with senior partners at venture firms earning nearly $1.5 million a year and managing general partners raking in almost $2 million. The average employee — comprising lower-level analysts, associates and even office managers as well as the top earners — is expected to haul in $777,000 this year in salary, bonus for 2005 and investment profits, according to a new study from Holt Private Equity Consultants and Dow Jones Private Equity Analyst, a trade publication.

Venture Firms Are Doling Out Large Pay Deals [Wall Street Journal]

Goldman Sachs says it has set aside as much as $542,000 in compensation per employee, already topping the total for 2005. Here are the envy-inducing details from Bloomberg.

Goldman said today it provided $13.9 billion in compensation for its 25,647 employees, compared with $11.7 billion for 22,425 employees at the end of last year. The firm, whose $27.9 billion of revenue has already exceeded last year’s record, typically allocates 50 percent of revenue to pay for the first three quarters and about 36 percent in the final quarter.

In other words, there’s more to come!

Speaking of which, have you heard any rumors of bonuses yet? Send it our way please! (All sources will be kept anonymous.)

Goldman Sets Aside $542,000 Per Employee, Beats 2005 [Bloomberg]