Wednesday, September 17, 2008

Lehman Layman

The I-Bank behemoths have been crushed, the S&P has broken the 1175 mark (Bear-Sterns low of earlier this year), the Russian stock market has been halted, the retail investors have their hides nailed to the wall and on the back of these crushing news heres what the compensation/retirement/severence packages for the executives of these greedy, unregulated jackasses look like:

(1) The demi-god of I-banking Richard Fuld,CEO Lehman:
Awarded $71.9 million by his board for bringing down Lehman. Interestingly I learnt via Tradermark that in Lehman's board (supposedly in place to rein in rogue jackass CEOs like Fuld, who is best known for launching scathing public attacks on his executives in meetings) 9 are retirees, 4 are over 75, 1 is a navy admiral, 1 is a theatre producer, only 2 on the board ever had any direct contact with the finance industry. The board has a risk assessment commitee that has met atleast twice in both 06 and 07 (via SEC filings) and to them everything was fine.

(2) Merryl Lynch mariachies:
  • Current CEO John Thain took up Merryl's reins in Dec 1 of 07, after being offered a 15 million USD signing bonus. Since Mr.Thain's first day in office Merryl's shares have fallen a mere 60% . If he decides to leave after the merger he is guaranteed another 11 million USD.
  • Trading Chief at Merryl Thomas Montag who is at Merryl for less than 6 weeks (joined Aug 6th, 2008) is expecting 76 million USD in accelerated compensation of he decides to leave.
  • Strategy head Peter Kraus who is at Merryl for less than a week now (yes you heard it right) will get 95 million USD for his hard work over the past week.

In the meantime 8%+ of my portfolio has been shaved off in the past 2 weeks. God bless Corporate America.


Anonymous said...

Jesus freaking Christ!!!! 90 million for 1 week's bad work, way to go.

sami said...

Those are some truly eye popping numbers, but often the execs wont sink, it will be the small players, the small people in the workforce who will go down

HappyBunny said...

When can I get jobs like that ^_^

applicant said...

So, these are new exectuives? The old ones must have seen what was about to happen and handed the job over to Fuld & other like him to be scapegoats. Hell, if someone appointed me to be the official guy to blame for a corporate collapse, I'd ask for millions, too. Still the numbers are anger-inducing.

I was actually offered a very senior position in a (sinking) REIT a couple of months ago. I rejected without giving it much thought. Maybe it was not the most profitable decision, but at least I am able to sleep at night.

OMGparishilton said...

@anon, sami: yea jesus freaking christ indeed

@happybunny: day you sale your soul to the devil ;-)

@applicant: fuld is actually with lehman since the 70s, so no scapegoat loophole for him, infact he specifically rejected buy-out deals prior to the bankruptcy filing as he felt he wasnt getting a good price for lehman

Anonymous said...

What a joke! Kraus was fired from Goldman for the Alpha Fund blow-up. $95 Mil to compensatation package for an unemployeed X-Goldman buddy???? Hard to believe the figure is correct.