|
Wall Street Execs Made $3 Billion Before Crisis; How to Make $300,000 Per Day for Fun and Profit
Sept. 26 (Bloomberg) -- Wall Street's five biggest firms paid more than $3 billion in the last five years to their top executives, while they presided over the packaging and sale of loans that helped bring down the investment-banking system.Merrill Lynch & Co. paid its chief executives the most, with Stanley O'Neal taking in $172 million from 2003 to 2007 and John Thain getting $86 million, including a signing bonus, after beginning work in December. The company agreed to be acquired by Bank of America Corp. for about $50 billion on Sept. 15. Bear Stearns Cos.'s James ``Jimmy'' Cayne made $161 million before the company collapsed and was sold to JPMorgan Chase & Co. in June. Democrats and Republicans in Congress are demanding that limits be placed on executive pay as part of the $700 billion financial rescue plan proposed by U.S. Treasury Secretary Henry Paulson. The former Goldman Sachs Group Inc. CEO, who received about $111 million between 2003 and 2006, said in testimony to Congress on Sept. 24 that he would accept such limits as part of the plan, after initially opposing them. The $3.1 billion paid to the top five executives at the firms between 2003 and 2007 was about three times what JPMorgan spent to buy Bear Stearns. Goldman Sachs had the highest total, with $859 million, followed by Bear Stearns at $609 million. CEO pay at the five firms increased each year, doubling to $253 million in 2007, according to data compiled from company filings. Executive-compensation figures include salary, bonuses, stock and stock options, some awarded for past performance. The options were valued at a third of the fair-market price of the stock at the time the options were granted, a method recommended by Graef Crystal, a compensation specialist and author of the Crystal Report on Executive Compensation, an online newsletter. The companies value the options using different methods. Some of these CEOs presided over the collapse of their companies and then received millions in compensation for separation packages when they left their failed companies. It is unfathomable that anyone is worth as much as some of these MBA-educated company looters. What the heck were the Boards of Directors doing? Where were the stockholders and bond holders of these companies? No wonder the FBI is investigating some of these companies. It remains to be seen whether anything comes of such investigations. What ever happened to pay for performance? Where can I sign on as the CEO for a company and then get compensated millions when I leave? I assure you, I will leave for a lot less than any of these guys did. Does anyone know the politics of some of the CEOs mentioned in this article and what their linkages might have been to such entities as Fannie Mae and Freddie Mac and such luminaries as Barney Frank, Chris Dodd, and others related to the subprime mortgage mess? Posted by: JohnQC 2008-09-27 |
| http://www.rantburg.com/poparticle.php?ID=251188 |