AT&T’s announcement that it would boost US capex by $1 billion and pay a $1,000 special bonus to 200,000 employees once Trump signs the Tax Cut bill into law (ideally before the holidays), has unleashed a veritable torrent of trickle down economics. And who would have thought that the “Fight for $15” movement would see some of America’s biggest banks as its latest members.
Shortly after the AT&T announcement, and just an hour after the passage of the Republican Tax Cuts and Jobs Act which cuts corporate taxes, in an attempt to be among the first to win the administration’s benevolence, Fifth Third Bancorp said that just like AT&T, it would pay more than 13,500 employees a bonus and raise the minimum wage of its workforce to $15 an hour. In total, approximately 75% of employees will receive a pay increase or bonus. Senior managers and top executives are excluded from the special payments.
Cincinnati-based Fifth Third, the fifteenth largest U.S. bank by asset size, said the tax cut allowed it to re-evaluate its employee pay and pass along some of the windfall. Nearly 3,000 workers will see hourly wages rise to $15. The $1,000 one-time bonus is expected to be paid by the end of this year, the bank said, assuming President Donald Trump signs the bill into law by Christmas.
“We want to invest in our most important asset – our people,” said Fifth Third President and CEO Greg Carmichael. “Our employees drive our reputation, our business and our success.”
Carmichael said the higher wage is an important step to help support individuals, their families and the communities in which we operate. Fifth Third has a history of investing in its 18,000 employees. Once the legislation is signed into law, nearly 3,000 hourly employees will see their pay increase to $15 an hour. The one-time $1,000 bonus is expected to be distributed by the end of the year, assuming the president signs the bill before Christmas. Senior managers and executive leadership are excluded from this compensation.
“It is good for our communities, employees and Fifth Third Bank,” Carmichael said.
At almost the exact same time, scandal-plagued Wells Fargo also said it would be boosting its minimum wage for employees to $15 an hour, to 11% from the current minimum wage of $13.50, which was prompted by the GOP tax plan. Warren Buffet’s favorite bank also said it would target $400 million in donations to community and nonprofit organizations next year, and also announced that beginning in 2019, it will target 2% of its after-tax profits for corporate philanthropy.
“We believe tax reform is good for our U.S. economy and are pleased to take these immediate steps to invest in our team members, communities, small businesses, and homeowners,” said President and CEO Tim Sloan. “We look forward to identifying additional opportunities for Wells Fargo to invest, as we continue to execute our business strategies and provide long-term value to all our stakeholders. As the nation’s largest small business lender and residential mortgage provider, we understand our significant role in helping grow the economy.”
“We’re ensuring that Wells Fargo is a great place to work by offering market-competitive compensation, career development opportunities, and a broad array of benefits,” Sloan said. “In addition to today’s announcement, over the past year we have added four additional paid holidays per year; enhanced our parental, caregiving, and backup adult care paid leave programs; and announced plans to grant restricted stock awards to approximately 250,000 team members that will vest in two years subject to grant terms. These awards are generally equivalent to 50 shares of Wells Fargo stock for eligible full-time team members and 30 shares for eligible part-time team members.”
In light of the bad press the bank has received in recent years, Wells’ attempt to mollify the general population, and the administartion, was to be expected. Furthermore, the bank’s generosity is hardly a shock following Goldman’s Monday calculation that Wells Fargo stands to benefit the most from all US banks, with up to 18% in EPS upside as a result of its lowered income tax.
And while it is certain that Wells’ benefits from tax cuts will more than outweigh any compsenation increases or philanthropy, it is also assured that many more banks will follow in these two banks footsteps as US corporations scramble to demonstrate their generous conscience, and “civic duty”, by returning if only a fraction of tax cut benefits to their employees and community. And who knows, maybe this time trickle down will actually work.
Outrage As Robinhood CEO Confesses To Elon Musk: DTCC Shut Down Stocks In Gamestop; AMC Surge
Did Congressional authority allow DTCC to help defraud middle-class investors buying Gamestop and AMC?
The CEO of Robinhood admitted to Elon Musk that the DTCC – The Depository Trust & Clearing Corporation – halted trading during a call Monday morning on the Clubhouse app.
This is not the first time this has happened…
This appears to be Pet Quarters having the same issue Robinhood has today. When Pet Quarters took it to court, the courts said something along the lines of: f*** you, don’t ever come back here (citing technicalities).
Why did they win? Well, DTCC is given the authority by Congress to regulate despite technically being a private organization
There’s more – “To date, except for one case where DTCC’s dismissal motion is pending, all of the cases either have been dismissed by the courts or withdrawn by the plaintiffs.”
Every AG in the country should be made aware of these facts and open investigations into the matter.
Why does Congress get to deputise a private organization as eco-hitmen for the market?
UPDATE (2/3/20 5:09 AM):
(Reuters) – Robinhood Chief Executive Vlad Tenev is expected to testify before a U.S. House committee on Feb. 18, Politico reported on Monday, citing people familiar with the matter.
The hearing before the House Financial Services Committee has not been formally announced, the report added
#AdiosAmerica: Republicans (with Democrats) Are Selling Out America to Corporations to Decrease Living Standards
Since the turn of the 20th century, living standards became an important, almost central part to the progressive and labor movements of those times. Now it has become a mainstream of both parties to sell out your labor to lowest bidders in low and high paying jobs. Low paying jobs are being taken by low-wage immigrants protected by Democrats and the high-end jobs are brought in by bi-partisan means, and greatly boasted by Republicans.
This effort has crippled the middle-class for close to 30 years now and with the job market being already tightened by the looming threat of A.I., importing more workers, whether legal or illegal is decreasing the value of labor in America for each and American Citizen. Corporations and Businesses, who rely on keeping employee costs as low as possible generally don’t complain about these practices across the board, why would they?
Americans have an increasingly difficult task ahead of them with the mass illegal migration at the Southern Border but also the legal importation of immigrants through H1-b1 Visas. These challenges will increasingly change the look, heritage of this country. There is no incentive for either Government or Business to care about reigning in immigration to the benefit of the American worker, the bottom dollar line will look better anyways.
Soros Newest Investor Of Tesla Bonds
Tesla looks to have a new bond holder and it’s none other than George Soros. Whatever this mean, Soros has also taken a stake in Crypto-Currencies .
Zerohedge Reports: Amid Elon Musk’s darkest hour in late March – as his stocks and bonds tumbled in price – it seems there was at least one other billionaire willing to buy the ‘blood on the street’.
According to the latest 13Fs, George Soros’ investment firm took a $35 million stake in Tesla’s convertible bonds during the first three months of the year.
As a reminder, convertibles are hybrid securities, either bonds or preferred stock, that can be exchanged for a predetermined number of common shares. That effectively lets an investor participate in stock-price changes, but with the yield and greater security of a fixed-income instrument.
The March 2019 Converts bounced handsomely off those lows – tracking the stock’s divergent bounce – but in recent days has fallen back towards the lows, catching down to the straight bonds record low price.