Just read on CNN:
After a notable 21-year career at Merrill Lynch & Co., Stanley O'Neal stepped down Tuesday as chairman and CEO, less than one week after the firm stunned Wall Street by revealing an $8 billion loss on risky investments in subprime mortgages.

That in itself can hardly be uncalled for, however further down in the article I read this:

Published reports about what O'Neal may walk away with have ranged from $129 million to $160 million.

The article can be read here: http://money.cnn.com/2007/10/30/news/companies/merrill_oneal/index.htm?

Now, how in the name of [insert your favourite deity] can somebody who is responsible for an $8 billion loss walk away with at least $129 million?????? Who wrote his contract? They ought to fire his/her sorry behind too!

This is unethical far beyond what I am able to comprehend. (besides I am envious: Imagine that a company allows you to mess up this big, and then rewards you with a bonus huge enough to let you live the rest of your life in luxury :yes: ).

I don't know much about wall street, but I assume $8 Billion over a 21 year period is pretty small fry for a bank the size of that! I would guess he has made a lot more than that in his previous 21 years and hence the substantial remuneration! PLUS if the dollar gets much weaker he might not get much for his money! Maybe just a small Yacht and 3 holiday homes!!!!!

But like I say, I know nothing about these people with far too much money to play with!

Plus are US billions and millions a bit different to what we term millions in Europe?

There are the very, very rich, there are the very, very poor, and then there's everyone else (us).

If the question is: Is anyone worth paying this much to? My answer is no one is 'worth' that much money.

Plus are US billions and millions a bit different to what we term millions in Europe?

I will gladly volunteer to receive a billion in US dollars and a billion in European currency with an objective of comparing the two. If I find a substantial difference in the enjoyment I get from either, I will let you know. :notme:

Dave

Just read on CNN:
After a notable 21-year career at Merrill Lynch & Co., Stanley O'Neal stepped down Tuesday as chairman and CEO, less than one week after the firm stunned Wall Street by revealing an $8 billion loss on risky investments in subprime mortgages.

That in itself can hardly be uncalled for, however further down in the article I read this:

Published reports about what O'Neal may walk away with have ranged from $129 million to $160 million.

The article can be read here: http://money.cnn.com/2007/10/30/news/companies/merrill_oneal/index.htm?

Now, how in the name of [insert your favourite deity] can somebody who is responsible for an $8 billion loss walk away with at least $129 million?????? Who wrote his contract? They ought to fire his/her sorry behind too!

This is unethical far beyond what I am able to comprehend. (besides I am envious: Imagine that a company allows you to mess up this big, and then rewards you with a bonus huge enough to let you live the rest of your life in luxury :yes: ).


According to the reports I heard, he received NO bonus of any sort this year, because of his poor results. I was grateful that a company finally made that linkage. I understood the 129 million was the accumulatation of stock, etc. over the years. That would be the equivalent of a 401k type accumulation (bit larger than mine) and they can't take that away retroactively. That's all I know, however.

I don't know much about wall street,
Will Rogers knew that Wall Street was crooked. "You can stand at the head of it, and you can only see to the bend. It just won't let you see all of it at once as short as it is."

Pretty much sums it up.:notme:

This dude along with the others essentially had a pre-nup with a compensation promise if the "marriage" didn't work. Basically stupid directors of corporations create plans for failure with the clowns they hire.

Reminds me of a story I once heard.

It's about an out-of-town visitor who was being shown the wonders of the New York financial district. When the tour group arrived at the Battery, one of his guides indicated some beautiful ships at anchor. "Look, those are the bankers' and brokers' yachts.

The out-of-town visitor inquisitively asked, "Where do the customers keep their yachts?"............

There are very few examples of the ultra-wealthy being held responsible for failure, fraud, or outright crime. A 140 million dollar going away package sounds about right for a CEO who lost 8 billion, at least in our culture it does.

There are very few examples of the ultra-wealthy being held responsible for failure, fraud, or outright crime.Key words:
held responsible

I will gladly volunteer to receive a billion in US dollars and a billion in European currency with an objective of comparing the two. If I find a substantial difference in the enjoyment I get from either, I will let you know. :notme::agree1:Exactly. It is like the guy who prays: God, give me a chance to find it for myself if money does not bring happiness.

It is a true "good old boys network" on Wall Street where they look out for each other first.
There is no way that anyone of these guys could ever objectivly quantify justification for the compensation that they get.
If they want to try and say that they are worth it because of what they do for a company then drop the 1$ backdated options and give them the company stock at market value as their primary compensation and see what they make based on what they do for a company.
Prince over at City is no better.

I heard recently that one firm ( I can not rember who) is going to put comensation levels to a shareholder vote. Hope it is a trend!
:2cents:

Allow me to play Devil’s Advocacy role a bit…

I will agree entirely that it is difficult to conceive any human being getting paid that kind of money. I do ask though, for all to be True to thy Self, and ask that you have the same animosity towards entertainers and sports figures who also make such skewed incomes?

Also, ask yourself: Who would you get to run a major corporation (one that has your stock)? My point is that it’s Supply and Demand. Companies have to offer generous packages to attract good executives. With two offers on the table, the executive will pick the one with “less strings attached”.

Again, I certainly am not taking up for them. Goodness knows I probably make less than most of you. Just throwing out some food for thought.

Certainly companies have to offer these ridiculous salaries to get and keep the best executives, along the route of what the OP was addressing though, it's entirely silly that such a failure should warrant such reward, it's a win win for any executive if you can go into a position, completely murder a company, cost people their jobs, homes, cause financial distress throughout the better part of the country, as well as economic concerns, and walk away with 130 million parting gift for it. Sub prime lending was taking big risks based on big greed and lost on the flop, it's certainly not limited to just this fella, but he's made a nice contribution to the whole mess that is our housing market and should be rewarded with an IRS audit and two weeks base salary.

As for executives' salaries in general, executives set and control them, they're not likely to vote to lower their own potential incomes, nothing of that sort would happen failing an outright revolution nationally. And they certainly don't earn those wages, I meet people everyday who work harder, smarter, better, earn 40k a year and contribute much more value to their communities in their lifetime than this guy ever would. It's just annoying that guys like this walk away with anything in their pockets when you consider all the misfortune his "mistakes" may cause.

I will agree entirely that it is difficult to conceive any human being getting paid that kind of money. I do ask though, for all to be True to thy Self, and ask that you have the same animosity towards entertainers and sports figures who also make such skewed incomes?I have not paid to go to a sporting event, concert or movie in probably 15 years. I also haven't paid to buy a single CD or DVD priced at over $5 in the last 10 years. Sure, I'll take your free tickets, cutouts or whatever, but you're not getting my money. I can't control where my 401k goes but you can bet that my roll-overs aren't with a company that pays its execs like this and charges outrageous fees just to hold my retirement account. All my short-term accounts are with a small local credit union. Vote with your money.

I have not paid to go to a sporting event, concert or movie in probably 15 years. I also haven't paid to buy a single CD or DVD priced at over $5 in the last 10 years. Sure, I'll take your free tickets, cutouts or whatever, but you're not getting my money. I can't control where my 401k goes but you can bet that my roll-overs aren't with a company that pays its execs like this and charges outrageous fees just to hold my retirement account. All my short-term accounts are with a small local credit union. Vote with your money.

Absolutely!! You better believe it! Your my hero, feathers and all!

A very good point Icy....we do "vote" with our money

I've never really been outraged with what performers and celebrities earn though...for instance I brought my gf to a Martina Mcbride concert this summer at $80 a ticket and it was worth every cent, talk about a great entertainer and vocalist and Mohegan Sun has a great concert hall, comfy and most every seat is a good view.

It's all about what you get back though, if she were a bad entertainer she wouldn't earn much, if she released a new album that sounded like garbage no one would buy it and no one would attend her concerts and her earnings would reflect a job poorly done, without her, there would be no product to sell.

Does the same hold true for CEO's, is their talent so unique, does their earnings truly reflect their skill and demand for it? When I buy a vehicle am I willing to accept that a % of the price is paying the CEO's questionable salary while plants are being shutdown, workers laid off, benefits reduced because he's doing a poor job? This is where I would vote with my money...but somehow I think the CEO in this case would still make his cash even while being forced to "step down" while the company would suffer more layoffs and shutdowns...

Definately makes for an interesting discussion.

There are the very, very rich, there are the very, very poor, and then there's everyone else (us).If the question is: Is anyone worth paying this much to? My answer is no one is 'worth' that much money.

Wow, not often I disagree with the master, but the original owner/entrepreneur is worth every last penny of the company she creates.

A hired gun brought in "manage"? Well apparently the free enterprise system is supposed to take care of their pay scale.....so it must be fine.

Our registrar had an idea to open a consulting company offering CEOs who would lay off workers, paint toys with lead, invest in high risk projects, eventually lose billions of dollars, etc. and do it for 50% of what the current CEO is being paid. I think he's on to something!

Excellent points, Benjamin. More point/counter-point:

Even with your example of entertainers.... as a matter of fact they do still earn money. Many of them have lucrative recording contracts and guaranteed earnings. You're right.. they don't make as much when they make a sorry recording. But we're talking $8mil a year instead of $11mil a year.:)

Same for actors/actresses. They get millions.. before the movie is even released.

It is a good discussion. I just think that when we see big buck executives we get a little upset. However, there are others in our society with similar pay structures.

In the end... don't we all get a little envious of anyone who makes more than us??

Wow, not often I disagree with the master, but the original owner/entrepreneur is worth every last penny of the company she creates. I'm referring to the personal profit, not the value of a company created by someone.

I'm not a 'master', everyone knows I'm a liberal, and I'm definitely not asking anyone to agree with me - Just stating my opinion. To me it becomes a moot issue once someone has made over 200 to 300 million US$. I guess my 'threshold' of "Can you really spend all of this money while at the same time supporting relatives in very good style and comfort, and at the same time provide financially for the future of the family for generations to come?" is about US$300 million. Each person has their 'threshold' opinion, but at some point more money is essentially pointless.

But who am I to talk. I haven't made 'millions'. I just watch flat salaries and jobs going away, as inflation creeps up on most people while a very, very rich few buy villas, or islands, in places like Dubai.

I guess if I was that rich I wouldn't care much about others either.

I guess if I was that rich I wouldn't care much about others either.I don't believe that's true about you, Marc. After all, your tag line is "People helping people around the world..." Not every fabulously wealthy person loses their capacity to care about their fellow man (e.g. Bill Gates (http://www.gatesfoundation.org/default.htm)).

Could it be that these people get away with this because we don't give them expectations to live up to? They are hired and then let loose to run free with a company with no supervision by the stockholders. Look what the last three CEO's at Kmart did. For some reason it reminds me of a stor my father told me once.

"A man came up to a farmer and told him he would give him one million dollars if he could develope the best apple tree in the world. The man said he would be back in 5 years. 5 years later he came to the farmer and asked if he had developed the tree. The farmer said he had the best apple tree that had ever been grown. They walked out to the field and the man saw the most beautiful apple tree he had ever beheld. It was loaded with great big red apples. The man was extatic and walked over to the tree. He pulled off an apple and bit into it. He immediately spit it out on the ground and said that it tasted terrible. The farmer responded; "Well hell, you didn't say nothin' about the taste".

Maybe this is the problem in our market today.

Doug

Me (the one on top...) :

http://elsmar.com/jpg/Grumpy.jpg

I don't know what I'd really do if I came into a 'fortune'. Probably not much different than how I live now. I do know that I live simply and I'm happy with my life, but I'm a child of the 1960's who still has a liberal dream, and it doesn't take much for me to be happy. Some of us old hippies are still around.

I will say that I'm still sad in some ways, though there's nothing I can do to 'save the world' (it took me a while to figure that out...). I've traveled to different parts of the world since I was 14. But I was in my 20's when I was in Nairobi when I went into a pretty deep depression over how some people live, how little they had (like food and clean water, not to mention a place to live other than a street corner). I'd do a long narrative (one of my specialties) but I have to get some stuff done (working on the server migration and a client meeting). Suffice to say from time to time I feel 'guilty' that I live so well compared to so many people on the earth. The increasing number of "Me" people out there makes me glad I'm as old as I am. I feel sorry for people in the future as the "I care about only me" people multiply.

Yup there are a few in the pay bracket of top business executives and their pay structures certainly can be comparable. As to our take on these folks, I don't know that I'd call it envy....more resentment, which sounds like a bitter word, but that's honestly what it boils down to.

It doesnt' bother me much that certain privelaged few in this world make ridiculous amounts of money, I am content with what I have and continue to feel proud of what I accomplish and earn and don't really compare myself against the ultra rich. That's not to say I haven't driven through Newport and thought to myself how neat it'd be to own one of those houses...I would name it "The Whole Enchilada" and have parties every Saturday and my own private cook! :lol:

The reality, however, is I get by, I can pay my bills and afford a few perks here and there and that keeps me appreciating what I have and I'm happy with that. The only time I find resentment for these execs, or ultra-rich, is when it is glaringly obvious that the rules we (being any class other than the rich and/or famous) abide by often do not apply to them.

I think Silent has the idea, we don't really have expectations of these folks, so in essence they do what they want and we accept it, just occassionally they mess up bad enough to make us wonder why they're getting millions for making a financial mess out of a business.

There are the very, very rich, there are the very, very poor, and then there's everyone else (us).

If the question is: Is anyone worth paying this much to? My answer is no one is 'worth' that much money.I agree. I'm sorry to notice the list of their names is getting long.

I don't know much about wall street, but I assume $8 Billion over a 21 year period is pretty small fry for a bank the size of that! I would guess he has made a lot more than that in his previous 21 years and hence the substantial remuneration! PLUS if the dollar gets much weaker he might not get much for his money! Maybe just a small Yacht and 3 holiday homes!!!!!

But like I say, I know nothing about these people with far too much money to play with!

Plus are US billions and millions a bit different to what we term millions in Europe?


Manix,
I seem to recall a difference in terminology between US Billion & the UK Billion, (don't know about the rest of Europe). It has been a few years since I heard this so I'll try to list it as best I can.

1 to 999 million is the same listed with 6 zeros following - 1,000,000

1 billion US is written 1,000,000,000 & I believe this is called 1,000 Million in the UK, and becomes 1 Billion once there are 12 zeros following 1,000,000,000,000

I think this is the way it went. Someone please correct this if I'm incorrect.:cfingers:

Manix,
I seem to recall a difference in terminology between US Billion & the UK Billion, (don't know about the rest of Europe). It has been a few years since I heard this so I'll try to list it as best I can.

1 to 999 million is the same listed with 6 zeros following - 1,000,000

1 billion US is written 1,000,000,000 & I believe this is called 1,000 Million in the UK, and becomes 1 Billion once there are 12 zeros following 1,000,000,000,000

I think this is the way it went. Someone please correct this if I'm incorrect.:cfingers:


It's mindboggling....:yes:

Look here (http://www.jimloy.com/math/billion.htm) for an explanation of Millions, Billions and Trillions....

Stijloor.

Manix,
I seem to recall a difference in terminology between US Billion & the UK Billion, (don't know about the rest of Europe). It has been a few years since I heard this so I'll try to list it as best I can.

1 to 999 million is the same listed with 6 zeros following - 1,000,000

1 billion US is written 1,000,000,000 & I believe this is called 1,000 Million in the UK, and becomes 1 Billion once there are 12 zeros following 1,000,000,000,000

I think this is the way it went. Someone please correct this if I'm incorrect.:cfingers:

A million (or a billion...) is the same everywhere. Where Manix might have been confused is in currency exchange rates; today $1 billion US is equivalent to £480,421,800 (UK). So it takes roughly twice as much money in to be considered a billionaire in the UK.

We used to use 10 to the power 12 in the UK as 1 billion but have now fallen in line with the rest of the world.

This is the definition in the Oxford English dictionary which gives the modern, international definition but retains reference to the old UK usage.

• cardinal number (pl. billions or (with numeral or quantifying word) same)
1 the number equivalent to the product of a thousand and a million; 1,000,000,000 or 10**9.
2 dated, chiefly Brit. a million million (1,000,000,000,000 or 10**12).
3 (billions) informal a very large number or amount.

It's mindboggling....:yes:

Look here (http://www.jimloy.com/math/billion.htm) for an explanation of Millions, Billions and Trillions....

Stijloor.

Wow, I didn't know it went up that high! Has anyone ever come across the use of a centillion? Now that would be money you simply could never spend!

Wow, I didn't know it went up that high! Has anyone ever come across the use of a centillion? Now that would be money you simply could never spend!

Yes. Look at this company's (http://www.centillion.com/en/) website. :tg:

Stijloor.