The head of the Wall Street investment bank Merrill Lynch is negotiating a severance package tipped to be as high as $159m after a risky strategy of betting billions on American mortgage-backed securities came disastrously unstuck.
Stan O’Neal, chief executive of Merrill, has told friends that he intends to resign after losing the confidence of his boardroom colleagues following the biggest loss in the bank’s 93-year history.
Nicknamed the “thundering herd” for its bull logo, Merrill has estimated its liabilities at $7.9bn from the summer’s global financial volatility and analysts believe the figure could increase to $12bn.
According to calculations by pay consultancy James Reda & Associates, the “golden parachute” awaiting Mr O’Neal includes $30m in retirement benefits plus $129m in stock and options. The figures are on top of his pay of $48m last year.
I guess our corporate barons still believe in a pat on the back and a bulging bank account – for people who make bad decisions?
His golden parachute is only 2% more of what they already loss. ONLY 2 percent! That’s like a thief sticking you up in the middle of night for the $100 in your wallet. Why not just give him the extra $2 you have in your pocket to be insured that he won’t take your life too (or the CEO taking down the whole company).
If that’s getting me fired, fire me anyday!
Well, would you not pay a thief another $2 not to kill you? Bu that really isn’t the point.
They have to offer Golden Parachutes like this in order to recruit CEOs. It in the contract at the time of hire or when the contract is renegotiated.
Sure it sucks but it sucks when you hire someone for $x/hour and they do a crappy job and you still have to pay them.
Sure, it’s the republican way..
Recruit CEO’s. Gig? Don’t know your investment world, eh. O’Neal has worked for Merrill since he left – General Motors – in 1986. Jumped at the chance to become CEO.
Gold is what passes for SOP among that particular country club set.
#3: “They have to offer Golden Parachutes like this in order to recruit CEOs. It in the contract at the time of hire or when the contract is renegotiated.”
GigG, they offer Golden Parachutes like this in order to keep CEOs QUIET if they ever get dumped. It is more HUSH MONEY than a severence package in order for the CEO to tell people what really goes on in the board room.
#5 So he had been there 21 years. Do you not think that during that time his compensation package has not been renegociated a few times? They obviously liked him somewhat if they kept him around that long.
And if you are going to blame him for the bad times you also have to give him credit for the good times.
http://tinyurl.com/2oqjt5
#7 – he’s already been paid – a hundred times over – for the good times.
The point still remains, these creeps cover each other’s buns with money even when they’re being shoved out the door for screwing up.
Do you know anything about sub-prime lending? Are you aware that all the regulations governing banking didn’t apply. There are no regulations! Any clown with a storefront could hang out a sign as “mortgage broker” and he was in business.
What O’Neal and his peers did was figure they’d get away with buying and selling sub-primes after the fact – ignoring the charges and changes that kicked in after the first 2 years. They suckered their investors in on it, as well. Dumb and dumber got caught.
And get a bonus on the way out.
Fuck these guys… I so hate these uber-rich alpha males… Nepotistic bastards hoarding the wealth generated off the backs of the working class…
You know, I’m not even jealous because I can’t be jealous of a guy who is resigning in shame.
With but a tiny sliver of what this guy is stealing for failure, I could have all I really need… A modest and safe home, a modest but reliable car, and a fair budget for food, clothes, a few creature comforts and a little entertainment. Most of us ask for so little but get scowled at when we try to do better… then this fuck comes along, loses 7 bil and takes home a fortune which will guarantee that his great great great grandchildren will go to Harvard.
I cannot wait for the revolution to come…
Burn the rich.
Imagine if this CEO had done a good job of investing those funds what kind of payment he would of received
Then again he would have to pay taxes on that gross income
Probably had a 100,000 square foot mansion
Reminds one of Woody Allen’s joke that a stock broker is a Professional who invests your money till it is all gone
Here are these people who trust with your money and their ability to reduce the taxes you pay and they behave like drunken sailors
The Looting of America by the CEOs just NEVER STOPS !!! GREED KNOWS NO BOUNDARIES !!!
If you are not a shareholder or customer of ML, why are you complaning? It frankly has nothing to do with you, or for that matter its none of your business what a private company decides to pay their former CEO upon leaving.
If you are a shareholder or customer either complain to your board, or change companies. Its not up to the government to govern what private companies decide to pay their outgoing employees, no matter how large that amount is, or how crappy a job that employee does.
People in this world need to learn to mind their own business.
#12
The thing is, I haven’t seen any shareholder complaint that actually worked.
I guarantee that this guy will get a CEO job at a major corporation.
Why? He’s in the club.
Performance doesn’t matter once you’re in the club.
#12, if you are a shareholder and you are not ultra rich, you complaint will fall on ears stuffed with your cash. The thing is even if you manage to get rid of these crooks, the board will bring in another of there friend who will do the same thing. The rich get out at the top and the little guy trying to save so that he can eat when he retires is left holding an empty bag.
Then they have to fire a few dozen hard working staffers who if there luck get 1 or 2 weeks pay for every year they have worked for the company, to pay the fat cat who at 56 mill a year in base pay can buy another home in a tax sheltered country.
Why is nothing done you ask because the law makers are rich so they are among the group filling their pockets.
We all no it is a government for the rich by the rich, cause only the rich can afford the entry fee. Every see a working stiff candidate? Didn’t think so.
They could have had him killed for 50,000 dollars but I guess that wouldn’t be ethical.160 million is a cheap way to get rid of him when you considor the legal complications
wow! that guy is genius! give the man a raise!!
If there had been no outsourcing.. the scheme might have worked..
#12
Nice going Bob… Always good to see someone willing to stand up for the big guy.
GigG
>>They have to offer Golden Parachutes like this in order to recruit CEOs. It in the contract at the time of hire or when the contract is renegotiated.
>> Sure it sucks but it sucks when you hire someone for $x/hour and they do a crappy job and you still have to pay them.
You’re not making sense in light of the fact, here.
They still have to pay this guys $160 million even though he did a HUGELY crappy job.
Do you HONESTLY believe that companies couldn’t find decent CEO’s for, let’s say, a measly $1 million a year plus health benefits?
This CEO pay is out-of-wack!
I say, repeal the Regan tax cuts that ended the golden era of middle class America.
Wow. You can tell the level of employment in the crowd that comments at Dvorak. The CEO got that money because he earned it. (and to keep him quiet about what he has seen) Do you suspect that no one else at the company realized what the plan was? Why is this one guy getting the blame? Everyone knew the plan and knew it was a gamble. That is very different than doing a bad job.
Anyone who believes that we shouldn’t pay someone who is doing a bad job can come work for me.