Category Archives: Shower Thoughts

Editorial, Local, Shower Thoughts

Amazon increases base pay cap from $160K to $350K citing the hot job market

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[SEATTLE, Wash.] – (MTN) On Monday, Amazon announced the company was increasing the maximum base salary for full-time corporate offices employees from $160K to $350K a year, citing competitive pressure in a hot job market. A closer look at how Amazon has compensated tech workers in the past finds that the old model no longer works, and probably never will again.

When Jeff Bezos was CEO, the mantra for hiring was Amazon wanted, “missionaries, not mercenaries.” The company hired people who were closely aligned with their company values and who were more interested in the opportunity to work for Amazon, than the base salary and benefits.

In 2021 Amazon lost 50 people at the vice president level or higher, a significant brain drain, even for a company the size of Amazon. Low pay was a reason cited by a number of employees that departed in 2021 and left the company with significant staffing gaps. It is likely that some departures were fueled by Andy Jassy moving into the CEO role. It is not uncommon in the Fortune 100 for changes to be among the executive team with a new corporate leader, even during times of high satisfaction.

Amazon compensates its corporate office employees based on 11 different pay grades. having insight into how those levels work provides a better understanding of why Amazon is having hiring challenges.

For employees at the associate level, L1 to L3 in Amazon compensation speak, the change in the salary is meaningless. The next pay levels are L4 to L6, which is the backbone of Amazon’s engineering, product planning, marketing, and operations. At the higher levels, the salary cap combined with other forces has become problematic. The next group is senior managers, which are L7 to L8, and there is no L9. L10 are vice presidents, L11 are direct reports to the CEO, and L12 is the CEO. In simplified terms, you can think of L1 to L5 as non-commissioned officers in the military and L6 as the start of the officer ranks at 2nd lieutenant. At the top, L12 is equal to a four-star general.

Prior to 2021, the total compensation model worked well for Amazon. An employee would be offered a base salary. For an L6, that typically would be $150K to $160K a year. In addition, the new employee would receive a sizeable grant for Amazon Restricted Stock Units (RSU). The stock would vest over four years but on a schedule that was advantageous for Amazon. If a new employee was offered 600 shares of stock at $500 per share (simplified example) as part of their initial compensation package, the vesting schedule would look like this.

  • End of first year – 5% – $15,000
  • End of second year – 15% – $45,000
  • Six months later – 20% – $60,000
  • End of third year – 20% – $60,000
  • Six months later – 20% – $60,000
  • End of fourth year – 20% – $60,000

Employees would receive additional RSUs depending on their role, team, and performance that vested on the same schedule. After four years of full-time employment, the packages became extremely lucrative, with multiple grants vesting 20 percent at a time every six months.

The value of the RSUs is tied directly to the performance of the stock market, so the model above assumes the stock price never changed. On Aug. 23, 2015, Amazon stock closed at $482.18. A year later the stock was at $739.61 and the year after that it reached $1038.95. The next value at each vesting window were $1,362.44, $1,802, $1670.57, and $1,992.03. The real value of those RSUs for someone starting on July 24, 2015 would vest at these amounts.

  • End of first year – 5% – $22,188
  • End of second year – 15% – $93,505
  • Six months later – 20% – $163,493
  • End of third year – 20% – $216,240
  • Six months later – 20% – $200,468
  • End of fourth year – 20% – $239.040

The original total value of the stock went from $300,000 to $934,934. That is on top of the salary capped at $160,000 a year and wait, there’s more, a two-year signing bonus.

To provide a compensation bridge for employees who hit the salary cap, and would derive little to no benefit from the RSU shares until 2-1/2 years of employment, Amazon offered signing bonuses. To keep the example simple, an L6 employee could receive a bonus offer of $90,000 in additional compensation, paid out at $50,000 in the first year and $40,000 in the second. The bonus is guaranteed as long as they stay employed.

Over four years, wrongly assuming our hypothetical middle-manager never received another RSU share or an additional cash bonus, their total compensation would be valued at $1.67 million – $417,500 a year.

The average tenure at Amazon was under 12 months, so many didn’t even make it to the first vesting window for stock. For others, two years was enough, and the pay gap that was created between the second year vest and the start of acceleration was a bridge too far. For those who could thrive in the Amazon work environment, the path to becoming a millionaire was just three to four years away, until COVID arrived.

On Feb. 26, 2020 when the first COVID-related death occurred in the United States, Amazon stock closed at $1,979.59 a share. On July 7 it broke $3,000 and the stock has spent most of its time between $3,000 and $3,400 ever since. There have been a few peaks and valleys out of that range, but they have been short-lived.

Since the summer of 2020, the stock has been, for newer hires with visions of becoming a millionaire in under four years, flatlined. The chances that $300,000 in RSUs at hiring will be worth closer to $300,000 four years later has dramatically increased.

There is room for growth. Amazon’s market cap of $1.64 trillion is equal to the GDP of Canada, and several companies, including Microsoft, have reached a $2 trillion market cap. However, the handful of stocks that have reached that milestone, haven’t climbed much higher.

The acceleration of Amazon’s success as an e-commerce platform, an entertainment platform, and a provider of cloud computing services, all fueled by COVID, broke the existing compensation model. Additionally, with many tech companies fully embracing remote work, the competitive landscape to hire new talent also created new opportunities for talent already working for Amazon.

The reinvention of Microsoft and a major change in its corporate culture, along with the presence of tech giants Google, SAP, Facebook, eBay, TikTok, and Apple, have created a cutthroat job market for tech workers. The salary cap at Amazon, a flatlined stock, ethical questions about the treatment of warehouse workers, and a high-pressure work environment has taken away much of the allure of working for the global behemoth.

The high rate of employee churn has created another problem. Thousands of highly skilled workers who used to work for Amazon would never consider returning to Amazon. Within Puget Sound, the pool of available hires has continued to shrink while remote work, and the current tight labor market provides almost unlimited opportunities for anyone who can write code.

Historically, the rewards for the resume and the bank account outweighed the reputation Amazon has for being a toxic work environment. Like other large corporations, what group someone works in and who their managers are, frequently dictated the culture within that team. Land in a team with the right manager, working in the right team, and at the right time, and the professional and personal rewards are great.

The shift in compensation model signals more than just hiring challenges. It is a signal that the days of minting millionaires by the thousands on a yearly basis are coming to an end, and Amazon is moving to what was once called a blue-chip stock.

BIPOC, Editorial, National, Shower Thoughts

Our slide into white nationalism takes a dangerous turn towards fascism

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Let that image sink in. As a nation, our Democracy is dying. We the People are extinguishing the beacon of freedom that was the United States. Our country is losing our moral high ground on a global scale and our ability to say, “you can’t treat humans like this.” We have become the enemy of ourselves.

The implications of what we have become will echo for decades. You may read this and go, “I’m white, male, Trump-supporting, agree with all of these actions, and it can’t happen to me.”

Study your history. It can happen to you because, through history, people thought the same thing. It is acceptable right up to the point they are in a concentration camp, or slave labor camp, or forced into conscription in an aborted war. There was no one left to go, “what the Hell, stop this!” Or maybe it will be your child, or your spouse, or your parents who will run afoul of the state.

Here are some facts that should keep every American awake. Immigration and Customs Enforcement operates as an extra-judicial organization and primarily outside of Constitutional protection.

FACT: Immigration and Customs Enforcement can do enforcement action at will up to 100 miles away from the borders of the United States. That includes waterways and ocean boundaries. Almost 70% of the United States population lives within this area.

FACT: Immigration and Customs Enforcement has set up checkpoints within this 100 miles zone. They are demanding proof of citizenship and operating outside of Constitutional protections.

QUESTION: If you had to prove your citizenship on the spot, can you? What if ICE says your paperwork is fake aka, “your papers are not in order,” and that you need to go to headquarters, errr detention. Think it doesn’t happen? Multiple United States citizens have ended up in ICE detention and held for months, told they have no Constitutional rights while in ICE custody.

FACT: ICE courts do not roll up into the Judicial branch of the United States government. They are part of the Executive Branch. Yes, that’s right, courts in the United States operate outside of the balance of power, and report directly to the Attorneys General. Run by the Executive Branch, this has created a system that works outside of the Constitution. Judges must meet deportation quotas. There are new rules invented out of thin air, and asylum seekers, even children, have to represent themselves with no translator and no legal council. The appeals process, which provides balance in the Judicial Branch by enabling defendants to argue that laws were violated in making a decision, are little more than kangaroo courts.

FACT: Illegal border crossing and the number of people seeking asylum has skyrocketed under the current administration, the “we must be tough,” polices are not working. Further, the actions taken against the governments of several Latin American countries, obstinately to reduce immigration, has only increased it.

FACT: The seal of decency, the outrage that would typically follow a savage attack on minorities, simply because they were minorities, is gone. The Latino population in the United States is living in fear because of almost three years of exaggerations, lies, and vile hatred directed at them.

All of these actions, all of these systems, this has happened before. Every dollar, the current administration gets, goes to building a private army for the Executive Branch. If fully weaponized, this system could move on almost 70% of the United States population at will. The Executive Branch could detain people into detention camps to disappear among the immigrants, to have cases heard by judges that report to the same branch. Not only are the seeds of dictatorship planted, but they are also growing into a tangled vine. The Legislative Branch is impotent and paralyzed, and leaders like Mitch McConnell are in lockstep alignment with the Executive Branch. You could argue, coherently, that McConnell helped lay the foundation for where we are today.

If you’re not familiar with your history, in Germany, an individual leader didn’t sweep to power illegally. A vote legally made by the Reichstag made him Chancellor. During this era, the political party didn’t openly support or organize violence against minority classes but didn’t do anything to stop it. They used language like “good people on both sides.” The vote by the Reichstag was tainted by the arrest, delay, and detention of politicians that would vote against giving the Chancellor dictatorial powers. However, there weren’t enough votes to stop it. The point becomes only academic.

If you’ve read this far to tell me what an idiot I am, please study your history. The Reichstag fire enabled the mass arrests of Communists, Socialists, trade union leaders, college professors, intellectuals, reporters, editors, and dissenters. Dachau became the first concentration camp for political prisoners. By effectively silencing any opposition by the end of 1933, the ire of the party could then focus on racial minorities, LGBTQ, Romani, the mentally ill, the disabled, Eastern Europeans, and Jews. The Final Solution started in 1942, a full nine years after the first concentration camp opened.

When it came to enforcement of the fascist state, the Gestapo was an organization with roughly 10,000 employees. Yes, you read that right, the secret police in Germany operated with an iron fist with that few people. They used citizens against each other. All it took was to talk ill of the state. But I love Trump! I would never speak evil of him! I am willing to bet that some of the same farmers that threatened USDA officials this week would have said the same thing 18 months ago.

An admission that up to 30% of US farmland couldn’t be planted because of historic flooding, levee collapses, and tariffs would be an admission of things we don’t admit. The farmers are outraged at the USDA because the crop forecast is beyond pure bullshit. The unintended consequence of hiding reality with the doctored USDA crop forecast was a collapse in grain prices. Farmers will get paid less due to the price collapse on a smaller harvest, cutting their profits even more. Enemies of the state – and I’ll repeat it – tariffs are socialism because tariffs represent price controls.

The Executive Branch has directed Immigration and Customs Enforcement to hold families, including children, indefinitely in concentration camp conditions. The due process comes from courts that work for the Executive Branch, where judges have quotas to achieve on deportations. You can’t even say that this is acceptable because “well, it is only illegal immigrants.” Multiple American citizens, including children, have been caught up in this system and held for months. They have been held outside of Constitutional protection and in conditions that violate the Constitution.

We are on the precipice of a cliff that history has shown leads us not to greatness, but as a shattered nation.

National, Shower Thoughts, Think About It

I always feel like, somebody’s watching me

A lot of keystrokes have been dedicated to the subject of “is Facebook listening to my conversations?” The general conclusion is a resounding, no to at the worst, highly unlikely. I feel like I need to adjust my tinfoil hat because I’ve had a couple of incidents lately that have me take pause and wonder, is AI listening to my conversations and using it for marketing?

Before I take this leap, let me provide a bit of background. I was, up until two weeks ago, the head of Product Marketing at a company that specializes in providing TV ad attribution to upper and lower funnel KPIs, as well as conversion events, to brands and networks. The ability to go this TV displayed this ad in this household, and then this phone or PC visited this website, or bought this item, or walked into this store, or, well you get the idea, is both very simple and very complex. The capability to do it to the level of an individual is possible. To be 100% clear, my company does not in any way engage in that level of tracking, nor do we use or even accept or process Personally Identifiable Information (PII). We also have a crystal-clear opt-in process. Those that know me, I mean know me, know I would quit tomorrow if I thought for one minute, we were doing something crooked. I’ve been under the hood.

The point of this is, I “understand,” this technology. I understand that between tracking pixels, cookies, UID, MAID, device IDs, and connecting all this data using LiveRamp or Adobe, as two examples, exists. It is completely true that when all your browsing, search, location, and social information is aggregated, even in an “anonymous” way, a very detailed picture of you emerges. A few years ago it was common that if you searched refrigerators online that you would see ads for refrigerators for the next six months – everywhere – even if you already bought a refrigerator. Now it seems that if you even thought about a fridge or said, “Hey honey, I think we need a new refrigerator,” ads appear. It could be as simple as you walked into a Best Buy store, followed by Frys, followed by Sears, and the location data was used to conclude you were looking at appliances. Yes, that simple.

Back to my tinfoil hat. Case study number one.

About a month ago at work, we were talking about printers and high-quality printers for photo production or other work. I had mentioned that years ago, I had owned a Minolta color laser printer that created amazing quality prints for years. That I had it until the drum had worn out, and the cost was prohibitive for replacement, so I got rid of it.

That same day, on Facebook, I was served an ad for Minolta color laser printer cartridges. I haven’t looked at replacement printers in a year. I certainly didn’t search for anything. I have gone into some office supply stores but not outside of my usual patterns. I hadn’t made any Amazon purchases related to Minolta anything, or anywhere else for that matter. I hadn’t even thought or dreamed about my Minolta printer, that I got rid of 7 years ago after five years of service. There it was, an ad for Minolta laser printer cartridges in my Facebook feed. I honestly went, “meh,” because I understand the technology for ad optimization.

Case study number two.

Today I was driving my daughter around to pick up a prescription. I told her about the massaging seats in my somewhat, new to us, car as we were traveling. I told her where the button was to turn it on and how it feels good on the back. She found the button and described it as like a cat kneading you and that it felt good. Her prescriptions were not back pain related; I have done no searches about back pain, or sciatica, or any other type of back-related pain. I did have an MRI on my shoulder about six weeks ago, but no ads were shown to me for pain management, back issues, or any other issue related to the back. I have done no searches about back or back-related problems. I haven’t been to a chiropractor or any other place where location data could go, hey, maybe we should show him this. So I get home and well, look for yourself.

Things that make you go, “Hmmmmm.” I have a conversation with my daughter about the massaging seats in my car and this is one of the first ads I see on Facebook after.

So now color me very skeptical, because leveraging what I know, it is getting harder for me to believe that Samsung, or Apple, or Facebook, or Google, or Amazon, or someone is not listening to my conversations and showing me ads related to those conversations. Case study one I can write off to bizarre coincidence. This second one makes it harder for me to accept that there is something deeper going on. Neural nets, artificial intelligence, and remarketing algorithms are good (well, in reality, they are pretty flawed, but they are getting better), but they are nowhere near that good.

Excuse me; I need to tighten my tinfoil hat.

Editorial, National, Shower Thoughts

Kevin Hassett leaving the White House

The Golfer-in-Chief’s top economic adviser is leaving the White House, per a tweet, with Twitter being the preferred communication tool for the most powerful nation in the world. The departure is very significant given the announcement of socialistic price controls tariffs on Mexico that will begin on June 10, and the widest inversion of the yield curve since 2007 on Friday.

Yield curve inversions have been a gold standard indicator of a looming recession in the last seven downturns. The yield curve has inverted three times since late 2018, with the latest and most dramatic inversion happening last week. A yield curve inversion is when long-term interest rates fall below short-term interest rates on bonds. Normally the yield on bonds should be better long term. The inversion happens when investors believe that the credit markets will get tighter, thus lowering returns on long term bonds.

Michael Schumacher, managing director and global head of rate strategy at Wells Fargo Securities stated on Friday that there was no need to be alarmed, and the inversion is no longer the gold standard of a looming recession. He did, however, in his next breath, he advise that investors should take a conservative stance.

It isn’t lost on the Malcontent on the timing of the departure, a weekend announcement via tweet, and the typical, “thank you for your amazing service,” praise. If prior experience is a good predictor of the future, it won’t be long before Kevin Hassett is low energy, stupid, and the worst economist on the planet.

The grim reality is if the taxes that get passed on to ordinary consumers tariffs imposed on China and Mexico are allowed to play out to their 25% maximum, it will have a significant impact on the US and global economies. With interest rates still low, and dear leader recently demanding they should be cut now to drive more growth, the fed has only a little runway to adjust rates to stimulate a stalled out economy before the fed rate goes back to zero. In an economic downturn the most powerful dial the federal reserve has is to lower rates, that and print more money with an IOU.

To an outside observer, it isn’t a big leap to speculate that Hassett disagreed with policy and was pushed out of the White House. Only the best people, you’ll see, only the greatest minds.

Oy.

Malcontent, out.

BIPOC, Editorial, National, Shower Thoughts

No, we aren’t better than this

I wanted to start this with the statement, “we are better than this,” but alas, we are not. At the El Paso Del Norte Border Patrol processing facility, 900 or more human beings have been stuffed into holding cells designed for 125 people. Regardless of if you want to call them non-resident aliens, refugees, asylum seekers, illegal aliens, criminals, or scum of the earth, they are human beings. They bleed red blood cells; they have frontal lobes, are bipedal, their liver is the lower right, they have two kidneys (mostly), two eyes, two ears, a mouth, they even have an anus.

The conditions are so bad that there is no space to sit or lie down. Some of the detainees (let’s call them detainees) end up standing on the open toilets to get some extra space from the overcrowding. But wait, there is more. Sixty-six percent of the detainees held have been in holding for more than 72 hours – that violates U.S. law.  Four percent have been held for two or more weeks, which spits on U.S. law. Who reported and documented this overcrowding? Fake news? The liberal left? George Soros? Russian trolls? No, it is documented by the Department of Homeland Security – our government – We the People.

This treatment of detainees isn’t the first time in our history as a country where we have treated human beings worse than farm animals. Let us remember, “free range” chickens are all the rage these days, and the people in these holding cells are packed like chickens in factory farms. Human beings are being treated by We the People worse than farm animals in an industrial setting. Sleep well tonight with that thought running through your head.

During the Gulf War, there was the mistreatment of Iraqi prisoners of war. During World War II there was internment of Japanese nationals while members of the German-American Bund got a free pass. Those German-Americans were white, but those sneaky Japanese, well they were brown and easy to spot.

Both sides of the United States Civil War committed atrocities to prisoners of war, with the Confederacy providing particularly horrific treatment to Union prisoners. Then there were the indigenous peoples of North America, stuffed onto reservations with no resources; their children were taken away for cultural education, all under the banner of manifest destiny. If we go even further back, there was the gathering up of indigenous people living in New England praying towns and abandoned on Deer Island in Boston Harbor with no food, water, clothing or shelter. Over 300 froze to death in the name of colonial security.

The sad reality is, we’re not better than this. We as a nation have a long history of, “you look and act differently from me, so you must be bad.”

Ya, if you’re so smart, if they immigrated here legal as a real law-abiding person would, this wouldn’t be happening. These are mostly families, in the same watchdog report from Homeland Security, who are fleeing oppression, drug dealers, and dictators seeking asylum. United States policy helped put the leadership in place in Guatemala, Nicaragua, and El Salvador. That is a whole different topic for another time – our amazing foreign policy that does a tremendous job of putting brutal dictators and feckless cowards into power all around the world.

The number of Mexican illegal aliens has been declining in the United States for years when you look at government numbers. The point of declining numbers of Mexican illegal aliens was a subject of an entire South Park episode in 2011. Up to 2018, the number of detained illegal aliens has been at near historic lows, and that carried through the entire Obama Administration. By the numbers, it sure looks like the crisis at the border is being manufactured to drive a narrative. Further, I say back to you, “Even if these were armed invaders in a conflict, their treatment would violate the Geneva Convention.”

“Ya, so what.”

So what? Look what happened to our prisoners of war in Vietnam when the United States refused to issue a formal declaration of war against North Vietnam. They were treated like – criminals. The brutality of Hanoi Hilton and other prison camps, and the hundreds of POWs that, ehem, “disappeared,” in custody that we don’t seem to be looking that hard for anymore. If you don’t think our treatment of foreign nationals has an impact on United States citizens in foreign custody, think again.

On the other hand, it is easy to make a snap judgment and go all Godwin Law, but our brutal history and treatment of detainees stand up as an exhibit that when it comes to We the People, this is who we are. In 2019 in the United States of America, detainees are crammed together for days in dirty clothes, no bedding, no room to lie down, limited access to facilities, not enough breathing space, and no privacy. If one person arrives with influenza, chicken pox, scabies, or norovirus, it spreads like wildfire in the close contact.

We haven’t been better than this. Maybe it’s time we stand up and say, “enough.”

Think about it.

Malcontent, out.