>On p.77 of Wall St., it says FIRE profits and salaries, as % of gross
>investment, hit 228% in 1932 -- meaning that allocators earned over
>twice as much as the investment funds they were allocating.
>
>How do the allocators get paid? I thought they skimmed off a
>slice of the funds they allocated.
Fees and interest mainly. Investment collapsed far more than FIRE did. Of course, as I argue throughout the book, FIRE does a lot more than channel savings into investment - they take a cut everytime someone writes a check or buys a stock from another stockholder. The LBO checking account is assessed something called a "profitability analysis fee" by the union-owned Amalgamated Bank of New York, which I guess means that just holding our modest balance wasn't profitable enough for them, so they had to tack a fee on top of it.
Doug