Are You Kidding Me?! V.2

S

Setec Astronomy

Well-known member
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???
 
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?
 
Us college kids need a bailout on our student loans. Think the government will help us if we complain enough? :chuckle:
 
Setec Astronomy said:
............Does anyone else feel like they just got bent over? IS NO ONE GOING TO JAIL FOR THIS???
Click to expand...
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.
 
Setec Astronomy said:
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???
Click to expand...



-AND-



Yeah,.. I hope someone goes to jail.
Click to expand...



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.
 
Accumulator said:
BUT I don't see it as an actual *crime*, let alone one worthy of incarceration.
Click to expand...



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



Accumulator said:
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.
Click to expand...



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/business/17merrill.html), even the lower level guys. Ask Jsatek about it, he put some of the guys in their jobs.



Accumulator said:
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).
Click to expand...



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.
 
Setec Astronomy said:
..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...
Click to expand...



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:
Click to expand...



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 :rolleyes:



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
Click to expand...



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. ...
Click to expand...



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 :hmph: I *do* share your displeasure at that!
 
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.
 
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.



Accumulator said:
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.
Click to expand...



*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- Heh heh, no real surprise that you and I can :argue this stuff til the cows come home and still end up circling round to where we agree- yeah, the whole fabric-of-society issue is one sad, sad downward spiral, huh?



And yeah...[all sorts of people] get mighty big bucks compared to the people who are teaching the next generation how to think, huh ;)



Oh, on the non-corrupt investment thing- I'll admit I probably miss a lot of gains by being pretty conscientious (and conservative) about such stuff; I vote my values, so to speak. I'm really into sleeping well at night...and that covers a lot of territory ;) Of course, *my* values might not be to everyone else's liking :o
 
Accumulator, always thoughtful and deliberate in your approach and response. :bigups



I do have another take on the criminality of the actions regarding the outrageous bonuses. I will also readily admit that I have neither seen or read the verbage between the government and the institutions. But at first blush, it would seem that there might be a case for fraud. As I understood the bailout it was for the solvency of the institutions. From perhaps a simplistic view that could include regular (salary only) compensation, but would exclude bonuses and perks not related to day-to-day operations.



And you are correct the boards. They are equally culpable.
 
Mr. Clean said:
.. As I understood the bailout it was for the solvency of the institutions. From perhaps a simplistic view that could include regular (salary only) compensation, but would exclude bonuses and perks not related to day-to-day operations..
Click to expand...



The way I look at it is that there's a dividing line between pre/post bailout activities:



While operating as a strictly private firm, owned by the shareholders (or partners/etc.), what they do regarding compensation (or say...expanding their fleet of corp. aircraft ;) ) is their business, period. Don't like it, invest elsewhere; but I won't tell somebody else how to run their business.



BUT... once they go begging and accept the bailout money (or some other form of salvation from without), the game changes. *Now* they're not playing with just their (private) shareholders' money, so now (IMO) they have to answer to more than those shareholders. If you don't want Joe Bluecollar (or rather, his elected representatives) to have a say in your business, then don't use his tax dollars to save it after you run it into the ground.



Heh heh, bonuses after they blow it?!? Yeah, that's a perfect example...what amazes me is that they have to have that sort of thing proscribed :rolleyes: [sarcasm] Why sure, let's reward people for doing a bad job, why would anybody mind and so what if they do? [/sarcasm]



The recent flap about Citigroup having to be scolded (and being caught prevaricating) before they cancel an order for their *sixth* corporate jet has me wondering....if the people making those decisions there are *that* obtuse, no *wonder* they're in trouble. I just don't get it, this is major-league idiocy played out in public for all to see. (Not so much the original planned purchase of the plane itself, but rather how the whole thing was subsequently handled.)



Seems like a lot of those guys still don't get it: they *FAILED* to perform to spec, they *proved themselves incompetent at what they do*, it really was simply *their fault* because they were behind the wheel when their car crashed. [/rant :o ]
 
Mr. Clean said:
outrageous bonuses.

And you are correct the boards. They are equally culpable.
Click to expand...





Here is the trick - Gov't is "bailing them out" and the bankers know its the last curtain. They are all stealing in a last ditch effort. Regulation will take the cash out of working for a bank and they will all move on to steal elsewhere. It will be a decade beofre we see real money on Wall St. again.



How does someone define and outrageous bonus? If you had an employee that netted you $450,000,000 last year, what is outrageous in giving him/her a $250,000,000 bonus? They earned it.



Boards are 100% at fault. The CEO's are just hustlers. From the boards lack of interest and blatant ignorance of the business they are supporting, they AGREED to sign contracts to pay people a salary, a bonus, a sign-on bonus, early departuree bonus, stock, options, plane usage, car, personal security, Etc..
 
Preach on Brotha! :LOLOL



I am in complete lockstep! I have a very low threshold for incompetence (Mrs. Clean is constantly on me to lighten up). To reward it is the highest form of idiocy. Yes, it is "our" money at this point. The guv'mint evidently should have had considerably more safeguards in the "plan" (at this point I use that term loosely). And as a taxpayer I feel defrauded. As such, I feel that all concerned, including the shareholders, should share in my "pain". How about no dividends paid until the loans are repaid in full with interest. Quartely reports as to all funds (to the nickel)dispersed. A ceiling on all compensation/perks. Would that prompt enough of an outrage to put those responsible under the thumb to run the operation with the greatest efficiency. :nomore:
 
You must log in or register to reply here.
Back
Top