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When $350,000 a Year Is Not Enough

Written by Gary North on March 2, 2012

Peter Schiff of Euro Pacific gets a lot of publicity as America’s leading proponent of gold. One of his relatives is on his staff. The relative just got national publicity.

Andrew Schiff was sitting in a traffic jam in California this month after giving a speech at an investment conference about gold. He turned off the satellite radio, got out of the car and screamed a profanity.

“I’m not Zen at all, and when I’m freaking out about the situation, where I’m stuck like a rat in a trap on a highway with no way to get out, it’s very hard,” Schiff, director of marketing for broker-dealer Euro Pacific Capital Inc., said in an interview.

Schiff, 46, is facing another kind of jam this year: Paid a lower bonus, he said the $350,000 he earns, enough to put him in the country’s top 1 percent by income, doesn’t cover his family’s private-school tuition, a Kent, Connecticut, summer rental and the upgrade they would like from their 1,200-square- foot Brooklyn duplex.

“I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.”

This appeared in a story not designed to gain readers’ sympathy: the “hard times” of Wall Street employees.

The smaller bonus checks that hit accounts across the financial-services industry this month are making it difficult to maintain the lifestyles that Wall Street workers expect, according to interviews with bankers and their accountants, therapists, advisers and headhunters.

“People who don’t have money don’t understand the stress,” said Alan Dlugash, a partner at accounting firm Marks Paneth & Shron LLP in New York who specializes in financial planning for the wealthy. “Could you imagine what it’s like to say I got three kids in private school, I have to think about pulling them out? How do you do that?”

The solution is o buy the Robinson Curriculum for $200, once per family, and have the wife stay home to administer the program. It is a self-taught curruculum.

Then use the Khan Academy for math.


But America’s rich do not think along these lines.

Facing a slump in revenue from investment banking and trading, Wall Street firms have trimmed 2011 discretionary pay. At Goldman Sachs Group Inc. (GS) and Barclays Capital, the cuts were at least 25 percent. Morgan Stanley (MS) capped cash bonuses at $125,000, and Deutsche Bank AG (DBK) increased the percentage of deferred pay.

“It’s a disaster,” said Ilana Weinstein, chief executive officer of New York-based search firm IDW Group LLC. “The entire construct of compensation has changed.”

I am shedding no tears. Are you?

Wall Street headhunter Daniel Arbeeny said his “income has gone down tremendously.” On a recent Sunday, he drove to Fairway Market in the Red Hook section of Brooklyn to buy discounted salmon for $5.99 a pound.

“They have a circular that they leave in front of the buildings in our neighborhood,” said Arbeeny, 49, who lives in nearby Cobble Hill, namesake for a line of pebbled-leather Kate Spade handbags. “We sit there, and I look through all of them to find out where it’s worth going.”

Executive-search veterans who work with hedge funds and banks make about $500,000 in good years, said Arbeeny, managing principal at New York-based CMF Partners LLC, declining to discuss specifics about his own income. He said he no longer goes on annual ski trips to Whistler (WB), Tahoe or Aspen.

Oh, the pain!

Richard Scheiner, 58, a real-estate investor and hedge-fund manager, said most people on Wall Street don’t save.

“When their means are cut, they’re stuck,” said Scheiner, whose New York-based hedge fund, Lane Gate Partners LLC, was down about 15 percent last year. “Not so much an issue for me and my wife because we’ve always saved.”

Scheiner said he spends about $500 a month to park one of his two Audis in a garage and at least $7,500 a year each for memberships at the Trump National Golf Club in Westchester and a gun club in upstate New York. A labradoodle named Zelda and a rescued bichon frise, Duke, cost $17,000 a year, including food, health care, boarding and a daily dog-walker who charges $17 each per outing, he said.

For more on the intolerable pain felt by the rich, click the link.

Continue Reading on finance.yahoo.com

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12 thoughts on “When $350,000 a Year Is Not Enough

  1. I think one of your common sayings sums it up the best:

    “It couldn’t have happened to a more deserving bunch.”

    Maybe this isn’t the case for Peter Schiff’s brother, but for most of the other bankers who rode high off of the bail outs.

  2. The problem is that in the not to distant future they will start stealing from their clients again and their bonuses will go back up. I have personal experience with the Peter Schiff fund group EuroPacific and what a bunch of CROOKS…after being with them for 4 years from 2007 my managed account is still down 50% and they still take their huge fees. Schiff's line of BS about where to invest outside the US is no better than a freshman broker sit down in front of a phone and told to cold call for a year. Do yourself a huge favor and stay away from the Peter Schiff EuroPacific group!!!

  3. American thinker says:

    Peter Schiff and EuroPacific are RIGHT ON with their predictions.

    I have read Peters books and listen to his advice and I am benefiting- you should too.

    I do not believe that "the rich" don't save. I do believe that all that dog grooming and summer rentals are examples of the wealthy spending their hard earned money and creating jobs so thank you Mr.s Schiff etc. et al for truly stimulating our economy.

  4. LISTEN, people are the same know matter what they earn. And why do people “invest” in these funds? to get RICH!!! The poor person steals with a gun, people falsify insurance claims, welfare and medicaid fraud, foodstamp fraud,
    so WHY ARE WRITING this CLASS WARFARE HATRED? Don’t you understand that these “bankers” spend their money on “their accountants, therapists, advisers and headhunters” You sound JUST L:IKE A COMMUNIST…revel in their misfortune, a-hole, it is everybody’s problem.

  5. Michele Obama admits her husband Barack Obama was
    born in Kenya. http://www.sodahead.com/united-states/did-michell

  6. bERNADINE says:

    That May be true or not several years ago there was a article in the paper
    that malom-X had an eligitement son, brought him to the united STATES
    FOR THE PURPOSE of making him a citzen so he could become a president
    of the country he hated. we all know Obama hate this country and is destroying
    America. Also OBAMA has said he is older by two years than what is birth record show.
    my guess is maybe every one is looking in the wrong places for the real birth of a adopted
    Obama by ANN & Berack Obama SR. and look into Ann's father who was involved with
    the adoption. IT is really time for AMERICA TRO WAKE UP TO WHAT THE DEMOCRATS

  7. And yes, their spending does help feed the economy, so this isn't good for any of us

  8. Sorry Peter, but I don't feel one bit sorry for you!

  9. Bill McCroskey says:

    We can afford a comfortable (anything but lavish btw) lifestyle yet I ENJOY finding ‘deals’ and saving money (It feels like it’s a enjoyable hobby to me.) I have never set foot in a Starbucks or drank any trendy quaffs. We shop at Dollar General for as many things we can buy. I told my now grown children years ago ‘being rich (comfortable) doesn’t necessarily make me stupid.’ The people’s plight in this article I can find NO sympathy for.

  10. Bruce D, says:

    I am happy there are people who make a lot of money. It should be a warning to all though that these types of people cannot manage their own money and seem to not have made any money from the investments they are advising others to make.

  11. Somebody knock the hell out of this brat.