Oh godammit. Blame everybody but the perpetrator. Blame the student at Trump University for being taken in by the fraud. Blame the consumer for over-payed CEO's.
@ThickStemz you are incredibly dense and uninformed. Once again you are lazy and wrong.
A major study of 1500 large companies in the US found performance is negatively correlated to CEO pay. In other words, the more a CEO is payed, the worse the company does. This has been noted several other times in other studies but the link to the abstract below cites a study with a large enough sample set that there can be no doubt about the result. Reason for this low performance? My take on it is that boards of directors are stuffed with cronies and butt buddies -- so-called elite businessmen -- and they are happy to pay each other wacked out high salaries then head to the golf course. Its not the consumer or the worker at fault for poor management and oversight.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1572085
Abstract:
We find evidence that Chief Executive Officer (CEO) pay is negatively related to future stock returns for periods up to three years after sorting on pay. For example, firms that pay their CEOs in the top ten percent of excess pay earn negative abnormal returns over the next three years of approximately -8%. The effect is stronger for CEOs who receive higher incentive pay relative to their peers and stronger for CEOs with greater tenure. Our results appear to be driven by high-pay related CEO overconfidence that leads to shareholder wealth losses from activities such as overinvestment and value-destroying mergers and acquisitions
The Highest-Paid CEOs Are The Worst Performers, New Study Says
http://www.forbes.com/sites/susanadams/2014/06/16/the-highest-paid-ceos-are-the-worst-performers-new-study-says/#2f83bf8f293a
Cooper and two professors, one at Purdue and the other at the University of Cambridge, have studied a large data set of the 1,500 companies with the biggest market caps, supplied by a firm called Execucomp. They also looked at pay and company performance in three-year periods over a relatively long time span, from 1994-2013, and compared what are known as firms’ “abnormal” performance, meaning a company’s revenues and profits as compared with like companies in their fields. They were startled to find that the more CEOs got paid, the worse their companies did.
the study shows that as a group, the companies run by the CEOS who were paid at the top 10% of the scale, had the worst performance. How much worse? The firms returned 10% less to their shareholders than did their industry peers.
Wall Street is its own union shop and the ticket into that union is most often an inheritance from parents into that country club. They take care of their own whether they earn it or not. Sounds like featherbedding to me. This practice among union workers is rightly scorned but the real problem lies at the top.
