Bankers Bonuses a Force for Good or Evil Essay Example | Topics and Well Written Essays - 2000 words

Bankers Bonuses a Force for Good or Evil - Essay Example This essay seeks to dissect the negative side or the disadvantages that will be caused by the stringent government and European Union policies on limiting the Banker’s bonus, which is regarded as a force for good for the bankers and a force for evil for the public and the overall economy. Essentially numerous reasons are attributed to the culture of the banks offering lucrative bonuses to the bankers. Some of these include the motivation to work so hard in a bid to create more wealth hence more profits. This brings the aspect of profits depends on the individuals employees of a certain bank. This dependency on the operations and talents of various individuals is immensely attributed to the volatile nature of the banking industry in terms of profit generation. The banking industry has developed over time and it is at a point where profits can be generated by well organized and selected factors of production (SMITHERS, 2013). On a similar front, the losses can be made through uncontrolled payments such as the bonuses to the bankers. This is most risky aspect in this discussion since it has been attributed to the 2008 crisis where lucrative banks plunged into economic turmoil which ended them to closure. In addition, most banks extend the bonuses to the bankers, since t he banks enjoy unwavering spot for bonuses because, when times are good and the overall nations’ economy is growing, the banks reap well in terms of profits and hence no doubt that, they will enjoy such pilferages. On a similar note, the banks find it hard not to give its employees the bonuses since they are metaphorically surrounded by bonuses since their stock is money. They use it to trade even in the stock exchange. This goes without a say that, the banks have the ability to extend large sums of money to the employees as bonuses because the money is available. However the question arises whether the government policy through the Bank of England on capping of the bonus and crawling them to 10