TARP Bonuses
 |
Definition of 'TARP Bonuses'A buzzword coined by the financial media during the financial crisis of 2008/09 to describe bonuses paid to employees and executives of banks and other financial firms that received Troubled Asset Relief Program (TARP) funds. TARP bonuses were controversial because employees were receiving additional pay even as their companies required bailout funds. |
 |
Investopedia explains 'TARP Bonuses'Companies argue that they have to pay bonuses to retain talent. But critics contend that because the companies led by the executives in question were being rescued with taxpayer money, the bonuses were not well-deserved and the recipients should not be considered "talent".On March 19, 2009, the House approved a bill to create legislation that would put a 90% tax on bonuses earned during the 2008 year. This tax would apply to banks receiving TARP bailout funds of more than $5 billion. This legislation was created in response to the public anger surrounding $165 million in bonuses that was paid to traders in the AIG Financial Products (A.I.G.F.P.) division, the division responsible for the majority of losses surrounding the fall of A.I.G. |
Related Definitions
Articles Of Interest
-
A Guide To CEO Compensation
Make sure you assess whether a CEO has a stake in doing a good job for you, the shareholder. -
Top 6 U.S. Government Financial Bailouts
U.S. bailouts date all the way back to 1792. Learn how the biggest ones affected the economy. -
The Bright Side Of The Credit Crisis
Find out how this tough economic period can be a learning experience for all. -
Dialing In On The Credit Crisis
Would a similar crisis have occurred if iPhone investors were offered the same loan options as homeowners? -
Fannie Mae, Freddie Mac And The Credit Crisis Of 2008
Is the U.S. Congress' failure to rein in these mortgage giants to blame for the financial fallout? -
Liquidity And Toxicity: Will TARP Fix The Financial System?
TARP is the government's attempt to forestall a deep, extended recession. Will it work? -
The 2007-08 Financial Crisis In Review
If you don't know how the recession began, read on to learn more. -
How Risk Free Is The Risk-Free Rate Of Return?
This rate is rarely questioned - unless the economy falls into disarray. -
Introduction To STRIPS
STRIPS provide an alternative form of bond for fixed-income investors who need definite cash flows at specific times. Read the article to find out how. -
Financial Risks That Don't Pay Off: The Cost Of Reckless Financial Behavior
Despite the recessions, citizens continue to take financial risks and spend outside of their means without fully appreciating the potential consequences for both themselves and the wider economy.
Free Annual Reports