Are You Kidding Me?! V.2

[Setec Astronomy]

Wait a frakking minute, so Merrill Lynch goes to the brink of bankruptcy and has to sell themselves to Bank of America. So last week BoA has to get additional bailout money to the tune of $20 billion in order to complete their acquisition of ML...but now it comes out that the ML executives handed out $4.1 billion in BONUSES to themselves a few weeks ago, just days before the sale became final, besides ML CEO Thain doing a $1.2 million redecoration of his office including a $1400 trash can.

Does anyone else feel like they just got bent over? IS NO ONE GOING TO JAIL FOR THIS???

[tnforever]

Yes, the whole banking sector is effed up imo. I don't know why the gov't is handing out 350 billion with little or no conditions like they are going to do with the 25 billion for the car industry.

IMo this just sends the wrong message to those already filthy rich execs that they don't have to worry if they screw up, they'll have the gov't to back them. Meanwhile their companies are going down the sh*tter they're handing millions of dollars to themselves.

The bailout should've come with terms that revamp the system, otherwise what's going to keep something like this from happening again?

[Scottwax]

Sucks that the government is thowing money at the problem without proper oversight.

[eyezack87]

Us college kids need a bailout on our student loans. Think the government will help us if we complain enough?

[Eliot Ness]

Originally Posted by Setec Astronomy

............Does anyone else feel like they just got bent over? IS NO ONE GOING TO JAIL FOR THIS???

Yeah, I feel like I just got bent over (yet again), and I hope someone goes to jail. Unfortunately if anyone goes it will probably be the poor schmuck that cleans their espresso machine for not having a green card.

[Hemin8r]

I knew this was going to happen.

[Accumulator]

Originally Posted by Setec Astronomy

Wait a frakking minute, so Merrill Lynch goes to the brink of bankruptcy and has to sell themselves to Bank of America. So last week BoA has to get additional bailout money to the tune of $20 billion in order to complete their acquisition of ML...but now it comes out that the ML executives handed out $4.1 billion in BONUSES to themselves a few weeks ago, just days before the sale became final, besides ML CEO Thain doing a $1.2 million redecoration of his office including a $1400 trash can.

Does anyone else feel like they just got bent over? IS NO ONE GOING TO JAIL FOR THIS???

-AND-

Yeah,.. I hope someone goes to jail.

I have a bit of interest in the goings-on at ML as [an Association I'm in] was once advised to move our investments to ML as a no-brainer way of upping our ROI. Fortunately some of us simply didn't trust ML the way we trust our current investment advisors, (whom we know personally) so the idea never got any traction.

I'll certainly agree that those bonuses were ill-advised to put it mildly. Perfect example of how *IRRATIONAL* greed and other poor decisions messed things up (short-term, personal-gain thinking in a long-term, best-for-the-firm industry). Somebody shoulda put the kibosh on such last-minute looting, BUT I don't see it as an actual *crime*, let alone one worthy of incarceration. Rather, it's just an example of bad business, why companies like ML should ended up in the dustbin of history (where they could serve as cautionary examples).

What I'd like to see is the responsible parties publicly pilloried for their actions. Something like a full-page in the WSJ that'd make them unemployable pariahs. Lawsuits brought by ML shareholders come to mind too (and what was ML's Board doing while all this was going on?!? This [stuff] doesn't happen in a vacuum).

In the course of due diligence BoA shoulda made sure the ML guys weren't pulling that sort of scorched-earth [crap]. I strongly suspect BoA woulda been taking a harder look (and a harder stance) had they not known they could play the game with govt. money. IMO the govt. involvement is likely to further erode the already frayed notion of personal responsibility.

[Setec Astronomy]

Originally Posted by Accumulator

BUT I don't see it as an actual *crime*, let alone one worthy of incarceration.

There oughta be a law! $4.1 bill in bonus alone is sounding like the proof to my theory that all the money "lost" in this market collapse is anything but lost, just look in the bank accounts of the executives...pump up the value of the company with fake money, draw it out in salary and bonus, then tell the investors you're sorry but the volatile market wiped out their investment...sounds like a classic con to me.

Apparently at least one gov't official seems to think there were illegalities: Cuomo subpoenas Thain for Merrill bonuses - Jan. 27, 2009

Originally Posted by Accumulator

What I'd like to see is the responsible parties publicly pilloried for their actions. Something like a full-page in the WSJ that'd make them unemployable pariahs.

What do they care if they are unemployable? They've made enough money to never have to work again (http://www.nytimes.com/2007/11/17/bu...17merrill.html), even the lower level guys. Ask Jsatek about it, he put some of the guys in their jobs.

Originally Posted by Accumulator

Lawsuits brought by ML shareholders come to mind too (and what was ML's Board doing while all this was going on?!? This [stuff] doesn't happen in a vacuum).

The boards are just as corrupt and crooked as the execs. It's an old boys club now...I guess it always was, but 25 years ago the CEO's made $250,000, not 100, or 200, or 300 times that much, with golden parachutes worth 500 times.

[Accumulator]

Originally Posted by Setec Astronomy

..all the money "lost" in this market collapse is anything but lost, just look in the bank accounts of the executives...pump up the value of the company with fake money, draw it out in salary and bonus, then tell the investors you're sorry but the volatile market wiped out their investment...sounds like a classic con to me...

Shrug...noting that I live 100% off my investments and usually maintain a pretty strong position in financials, people shouldn't a) invest money in the market that they can't afford to lose and/or b) invest blindly (the salaries/bonuses/etc. aren't fraudulent the way some stuff like over-valued/rated holdings were, but are rather just something you accept as an investor or you don't).

People thought ML was great when it was paying them 8%, even though some of us where thinking "hold on here...".

If they really did indulge in creative accounting (the "fake money" thing), then there are laws on the books to cover that and sure, throw the book at 'em.

Apparently at least one gov't official seems to think there were illegalities:

Eh..I couldn't care less about Cuomo's opinions about this stuff (any more than he'd care about mine). But sure, let's see any such truly criminal misconduct prosecuted, I'll be the first to say "bravo".

If somebody doesn't like how a company compensates its employees they should just invest elsewhere. I myself don't mind that the guys running the companies I'm invested in are getting paid big bucks, IMO they're earning those salaries (and when I don't believe that it's one more reason to invest elsewhere).

If the govt. hadn't invested our money in these bailouts I guess it'd be more cut-and-dried and that's the thing that ticks *me* off...I wouldn't invest in a lot of these companies but the govt. takes my tax money and *they* invest in them for me

IMO the issue of exec compensation is no different from paying pro athletes big money to play some game in the hope that it'll generate revenue and nobody seems to mind that.

What do they care if they are unemployable? They've made enough money to never have to work again

I don't see most of those guys riding off into the sunset, their egos won't allow it. And I wouldn't discount the effect of complete loss of social standing on those sort of people. Just look at the recent high-profile suicides, and those people still had a *lot* of money; they just couldn't stand being "failures". If nothing else, disgracing these guys sends a warning to the next generation of execs. OR..let the stockholders sue for fiduciary misconduct.

The boards are just as corrupt and crooked as the execs. ...

If/when you believe that, I'd say don't invest in those companies. Guess I just don't share your view on that; I still believe in the complimentary self-interests of rational people. (Yeah, I know, that's where Greenspan now thinks he went wrong. Not like I think I have all the answers either, just some firmly held opinions )

Argh...oh yeah, that's right, we're all investing in some mighty iffy companies via the bailouts I *do* share your displeasure at that!

[jdoria]

That's the plan! Pay the people BEFORE BofA (a known poor paying bank) gets control!

Thain's office must have been nice! Never again, he is a dead man on Wall St.

This is a sign of the "last hurrah".

Banking is dead.

People will never make that big money again in the business.

Regulation will turn a once $1,000,000 per year position into a $400,000 job. It is a well needed reset to the business.

[Setec Astronomy]

Accumulator, I hear what you're saying, and it would be simple to avoid the "corrupt" companies if only you could figure out which ones those are, and if it didn't seem to be *ALL* of them. To me, as I've ranted in other threads, this is a fabric of society issue, and these guys are just modern day robber barons.

Originally Posted by Accumulator

IMO the issue of exec compensation is no different from paying pro athletes big money to play some game in the hope that it'll generate revenue and nobody seems to mind that.

*I* mind, that and the celebrity paychecks. It's a world gone mad, I tell you! The president of the United States makes what, $400K? And we expect him to do a lot better job than any of these big-business CEO's. I'm too tired tonight to rant anymore about how the collusion of government and big business and the MBA-CEO mindset has sacrificed the greatness of our country at the altar of greed and ego.

[Setec Astronomy]

Originally Posted by jdoria

That's the plan...

Sure, I paraquote you as jsatek and now you go and change your name...