Wall Street Pay Limits Are Back on Regulators' To-Do List
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What is the main topic discussed in this episode?
With your Money Briefing, I'm J.R. Whelan at The Wall Street Journal in New York. Banking regulators are putting their focus back on limits on Wall Street pay. But doesn't that seem odd during a Republican administration? It's not as odd as you think. We'll explain in a moment. First, these money and market stories you should know. Philadelphia is the first major U.S. city to ban cashless stores, and that has fired up the debate that some see Pitt's retail innovation against lawmakers trying to protect all citizens' access to the marketplace. Philadelphia's new law goes into effect in July. and it will require most retail stores to accept cash. Other big cities and states are moving in that direction.
A New York City councilman is pushing similar legislation. And New Jersey's legislature recently passed a bill banning cashless stores statewide. Massachusetts goes the farthest on the issue. It's the only state that requires retailers to accept cash. Businesses have gone cashless to increase efficiency for employees. and improve safety because workers don't have to carry large bank deposits. But supporters of the law say they worry about people who don't have a credit card or a debit card or smartphone-based payment option. And supporters say some consumers prefer to pay cash anyway for privacy reasons.
What recent local policies about cashless stores should consumers know about?
And are you looking for a new job? Be sure to include your love of video games on your resume. The journal's Sarah Needleman reports employers across a range of industries are embracing resumes that include backgrounds in making or playing video games. Hiring managers feel that video games can help employees with online collaboration, problem solving, and other critical workplace skills.
Why did Philadelphia and other cities move to ban cashless retail stores?
In a 2017 survey by Robert Half Technology, 24% of more than 2,500 chief information officers say they were attracted to entry-level job candidates who cited playing or developing video games as a hobby. Putting limits on Wall Street pay was a front burner issue during the financial crisis, but it has faded into the background in the years since. Well, now regulators want to put it back on the table, and Wall Street Journal reporter Andrew Ackerman is on the line with us with some details. So, Andrew, these pay limits would come in the form of deferments and bonuses levered to a company's performance.
Banks and other brokers, asset managers probably, they would all be required to to defer bonuses or portions of bonuses over over several years. And then if the companies at the firms got into trouble, they'd have to claw back some of that bonus that was already doled out.
Now, this might seem unusual during a Republican administration, but the thought here is that let's get this done now before a Democrat might take the White House in 2020.
Yeah, it's one of the reasons why we thought it was newsworthy that, you know, you basically have an administration that, well, I mean, the president himself, when he was running, he said he's going to do a big number on Dodd-Frank. And there was definitely this movement away from this period where we were just adding on rules to the financial services industry. And if anything, we're sort of tailoring things. I wouldn't call it necessarily deregulatory, but the approach has been to loosen some of the restrictions down. on financial firms, particularly medium-sized banks, and make it easier for banks to merge. And so this is seen as something kind of in a different direction. But we're not exactly sure.
I mean, there's interest among the principals at these agencies in doing something. They haven't yet really explained their rationale. We just know that there's interest in doing it. So that'll be something to watch. I mean, maybe they think that it's not necessarily the the pay is too high. It's that the pay isn't necessarily aligned adequately with risk taking at the firms.
And as you point out in your story, some banks say they have been deferring pay, but that's been overshadowed by some pretty hefty payouts elsewhere.
I mean, I think it's noteworthy that Jamie Dimon, the head of JP Morgan, broke the $30 million a year compensation threshold
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:05–1:21
2
What recent local policies about cashless stores should consumers know about?
1:21–1:43
3
Why did Philadelphia and other cities move to ban cashless retail stores?
1:43–5:00
4
How do businesses justify going cashless and what are the concerns opponents raise?
5:00–6:32
Speakers
2 identifiedMore from WSJ Your Money Briefing
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