💸 Boss money

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Spoiler alert: CEOs are making money you can only dream of. Plus: The "Bitcoin Bonnie and Clyde" saga advances. Let's get into it.

By Allison Morrow

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Last updated August 3 at 7:44 PM ET

💰 A.I. YI-YI

It's no secret that the CEO of your company is making bank. Getting a fat paycheck is, arguably, the only real benefit of being the boss.

But the gulf between a CEO's paycheck and their typical employee's has been widening for years, and the advent of AI — with its promise of automation and efficient problem-solving — is already threatening to exacerbate that gap.

See here: A new report from the AFL-CIO found that compensation among S&P 500 companies last year was $16.7 million — the second-highest level of executive pay ever. (2021 was the highest at $$18.3 million)

CEO pay actually fell last year compared to the previous year, said Brandon Rees, the AFL-CIO's deputy director of corporations and capital markets.

"However, it didn't fall nearly as much as stock prices fell, at which is the CEO's favorite yardstick for measuring their own performance...By any measure, CEO pay is still off the charts by historical measures."

(The S&P 500 fell by more than 18% in 2022, versus a decline of just 9% for the average CEO's pay package.)

But let's put that $16.7 million in context: Assuming a 45-year career at an average pay of $75,200, regular employees would need to work more than five lifetimes to make what the average CEO receives in a single year.

That is ... well, discouraging.

Meanwhile, US workers' real hourly wages fell in 2022 for the second year in a row by 1.6% after adjusting for inflation, the executive pay report found.

The bot battle
Among the biggest concerns raised in the pay report is the way AI is poised to benefit executives more than their employees. It's not hard to imagine it: Company X uses AI to become more efficient and profitable —probably by laying off or cutting the pay of humans who used to do those jobs — and investors reward the company by driving up its stock, lining the pockets of shareholders but not doing much for the average employee.

"The AI revolution has potential to unleash broad-based prosperity that improves working conditions and lifts us all up," said AFL-CIO Secretary-Treasurer Fred Redmond. "But if it's left unchecked, AI can increase economic inequality and undermined job security ... It doesn't have to be this way, and working people are starting to fight back," he said, noting how AI has become a central sticking point in the Hollywood strike.

It's not that the labor movement is anti-tech. It's just anti-tech-that-dehumanizes-work and anti-workers-not-having-a-say-in-how-tech-is-implemented.

"We really think that it's important that when companies tell us they can't afford it, or that it doesn't work for their business model, that we need to look at what they're doing with executive compensation and actually call them out for the inconsistency and hypocrisy that that reflects," said Duncan Crabtree-Ireland, the national executive director and chief negotiator for SAG-AFTRA. "Our members are rightly concerned about these big companies taking and owning their image, their likeness, digital replicas of them, and really replacing them as workers."

QUOTE OF THE DAY

There are some things people shouldn't worry about. This is one.

Warren Buffett isn't worrying, and neither should you. (Though in fairness it's a lot easier to not worry if you're a centi-billionaire.)

The "Oracle of Omaha" told CNBC on Thursday that his company, Berkshire Hathaway, bought $10 billion worth of US Treasuries on Monday and did the same exactly a week prior. "The only question for next Monday is whether we will buy $10 billion in 3-month or 6-month," he said.

That suggests that much like others on Wall Street, Buffett believes Fitch's downgrade won't have much of a negative impact on the economy, the government's ability to borrow, or the safety of US Treasuries. Read more.

💸 'BITCOIN BONNIE & CLYDE'

If you were living in New York early last year, you've probably heard of the oddball Manhattan couple that got arrested and charged with laundering billions of dollars in ill-gotten cryptocurrency.

Even if that doesn't ring a bell, buckle on up.

Here's the deal: Last year, husband and wife Ilya Lichtenstein and Heather Morgan, both in their 30s, were indicted in connection with a massive 2016 crypto hack. It didn't take New York media long to start unearthing some of the more quirky aspects of their life in Manhattan, where they were often seen walking their Bengal cat, Clarissa, on a leash.

Lichtenstein was a Silicon Valley guy. Morgan had a more colorful side that she was not shy about putting online. She was an aspiring investor and rapper who went by the alias "Razzlekhan." Her Twitter bio says she is a "tech entrepreneur, surrealist artist, rapper, prolific writer, & fashion designer with synesthesia."

Their brazen financial crimes — alleged crimes, at the time — earned them the nickname "Bitcoin Bonnie and Clyde."

Fast forward to today...

As part of a deal with prosecutors, Lichtenstein and Morgan both pleaded guilty to money laundering.

The Justice Department says Lichtenstein "used a number of advanced hacking tools and techniques to gain access to Bitfinex's network" and was able to fraudulently authorize more than 2,000 transactions in which nearly 120,000 bitcoin were transferred to a cryptocurrency wallet in Lichtenstein's control.

"Lichtenstein then took steps to cover his tracks" and enlisted his wife's help in laundering the funds, prosecutors said.

Lichtenstein, who emigrated from Russia, will remain in jail while awaiting sentencing. Morgan will remain under house arrest.

Lichtenstein pleaded guilty to conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison, according to a press release from the Justice Department. Morgan pleaded guilty to one count of money laundering conspiracy and one count of conspiracy to defraud the United States, each of which carries a maximum sentence of five years in prison.

If government prosecutors find that their cooperation has been sufficiently helpful, however, they can ask the judge for a sentence below those guidelines.

WHAT ELSE IS GOING ON?

📈 Amazon stock surged around 10% in late trading after it reported stronger-than-expected sales in the second quarter.

🍎 Apple's revenue slipped in the most recent quarter, marking the third consecutive year-over-year drop in quarterly revenue for the world's most valuable company.

🍽 The New York City Council approved a bill to make pandemic-era outdoor dining a permanent part of the city, with some restrictions.

🧵 Threads, Meta's Twitter rival, is struggling to retain users roughly a month after its highly publicized launch.