From Seeking Alpha's Richard Shaw:

Executive compensation is a difficult issue.  Although we grant that the challenge in designing a reasonable system that works in all seasons is daunting, in the net we come down on the side that the compensation is too often too great.

We believe that the incentives are not adequately designed by objective third-parties  — highly compensated directors who like their pay and serve at the pleasure of the CEO are not objective third parties.

Now with the moral hazard element associated with government rescue of financial institutions, the possibility of truly unjust enrichment of banking executives looms large.

Many bank executives received large salaries and large bonuses for the growth and illusory short-term profits associated with mortgage lending and mortgage securitization that landed us in the current mess.

Some lost their jobs as a result of massive losses of shareholder equity, while being shoved out the door with huge sums of severance pay.

Now we face the issue of executive stock options issued recently during this period of deeply depressed bank stock prices.  Will they balloon into great riches for executives who happen to be at the helm when the Fed, the Treasury, the Congress and ultimately the tax payers bail-out the banking system?