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One aspect one discussed the fresh epic community of Salomon Brothers is actually the fresh fancy bonuses provided to help you the group. This type of magnificent perks had been a good testament for the company’s victory and the brand new enormous wealth they made. Although not, nevertheless they led to a society away from excessive using and opulence you to definitely permeated the business. That it part have a tendency to explore the fresh ins and outs of your own Salomon Brothers’ bonuses, exploring both the negative and positive elements it delivered to the newest desk.
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It supported while the a preventive story regarding the consequences out of unethical decisions and you will an excessive amount of chance-ingesting the fresh financial globe. Salomon Brothers’ novel method to market-making set him or her apart from antique banks. These were recognized for making areas in a variety of securities, facilitating exchange and you will guaranteeing liquidity on the market.
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The fresh consequences were not simply for the firm by itself but reverberated over the whole monetary community. The newest scandal got a profound affect the fresh society in the Salomon Brothers, causing improved regulatory analysis and you will a change to the an even more risk-averse method. On the aftermath of one’s scandal, Salomon Brothers experienced enormous demands. The company must navigate a land out of judge issues, tarnished reputation, plus the departure of key numbers.
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