Stocks are plummeting, securities firms are toppling, a $700 billion government bailout is underway and Americans are furious over executive compensation. But even as financial markets flounder, bonuses are unsinkable.

Merrill Lynch, which has seen a 70 percent drop in its stock this year, is dedicating $6.7 billion to bonuses. Amazingly, some employees at now-bankrupt Lehman Brothers will get the same bonus as last year. Goldman Sachs and Morgan Stanley, both of which are still profitable, will spend $13 billion on bonuses this year. For some firms, this is an overall or significant decrease in bonus spending from previous years, but higher-level employees will most likely not feel the effects of the squeeze.  

Barney Frank, chairman of the House Financial Services Committee, has been outspoken in his opposition to bonuses during such bleak economic times. He believes a moratorium should be placed on bonuses--an action that would eliminate the argument that bonuses are necessary to keep companies competitive for recruiting. 

"I'm just flabbergasted that the financial community has failed to show any sense of leadership on this issue and doesn't seem to understand how angry people are at them," said Nell Minow, editor of Corporate Library, a Portland, Maine-based corporate-governance research firm. "They are just a bonus away from having the villagers come after them with torches."

For more:
- read the entire Bloomberg article  

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