The Tangled Lines Of A Golden Parachute
Isn’t it amazing how this report makes it sound like Fuld is an upstanding, wonderful CEO who is stepping down with no “bonus or severance”? What a nice guy…
Richard Fuld, the chief executive of Lehman Brothers Holdings Inc, will step down by year’s end, and not receive any bonus or severance when he leaves, a company spokesman said on Wednesday.
Fuld, awarded $22 million in compensation in fiscal 2007, has been widely criticized for having done little to save the company from collapse.
I’m not saying Richard Fuld is responsible for any wrongdoing, but ethically, I think he has some serious issues he needs to deal with.
At the end of 2007, he accepted $22 million in compensation. Did he accept that compensation before, or after, he found out that Lehman Brothers was going to be circling the drain in no time?
Now, don’t get me wrong either, I think he should be compensated for the job he did. I just think $22 million in compensation when the company is facing certain bankruptcy is just asinine.
Don’t worry about Richard, his golden parachute isn’t taking him too far. he’ll still be serving as non-management chairman of the board.
Sphere: Related ContentI Can Hear The Popping Already
What? Good news without a negative? This just doesn’t sound right.
U.S. mortgage finance company Freddie Mac (FRE.N) easily sold $2 billion of short-term debt on Monday, helping to reassure investors that both Freddie Mac and Fannie Mae (FNM.N) can fund operations without a government bailout.
If there is anymore positive news on the housing front, heads are going to explode. How will anything ‘change’ if everything gets better before the election?
Bill Gates Gets Trashy
Is Bill Gates getting trashy? Well, sort of… In a way, he has been trashy for a long time.
Bill Gates’s investment arm has waded into a brewing takeover battle between Waste Management Inc (WMI.N) and Republic Services Inc (RSG.N), asking Waste Management to walk away.
Just over a month after he left Microsoft Corp (MSFT.O), Gates’s BGI is lobbying the largest U.S. trash hauler to drop the unsolicited $6.2 billion bid it made this month for Republic, the third largest.
While his investment vehicles have stakes in dozens of companies, they have kept low profiles over the years and Gates has not traditionally been known as an activist investor.
It’s weird watching Bill Gates flexing his monetary muscles outside of the Microsoft arena. While this situation is causing quite a stink, I wonder if all his investments will get the same amount of attention now that he doesn’t have to go into the office each day?
Chrysler Locks It Down
So, what’s the best way to eliminate risk in this “downturned” market? Chrysler thinks the best plan is to stop allowing people to lease vehicles. For the average person, leases are stupid anyway.
Chrysler LLC said its financing arm would stop offering vehicle leases to U.S. consumers, a sharp break in strategy in response to tighter credit and the plunging resale prices for gas-guzzling trucks.
The abrupt announcement on Friday afternoon was the latest sign of the stress on Chrysler from an industry downturn that has hit all automakers. Earlier this week, Chrysler said it would cut 1,000 white-collar jobs by the end of September.
Next week, they plan to stop offering basic credit as well. Heck, if you don’t have the money to pay it in full, you don’t need a new car, do you?
Everything Is Going Up
The arrival of stimulus checks and retail sales aren’t the only thing rising fast these days…
Soaring energy costs pushed inflation up in May at the fastest pace in six months. Food costs kept rising, too, and all signs are pointing to more bad news on gasoline, oil and food in the months ahead.
Costs for clothing and prescription drugs did drop last month, but consumer prices rose by 0.6 percent in all, the biggest one-month increase since November, the Labor Department reported Friday.
Food prices, which had taken the biggest one-month leap in 18 years in April, rose by a more moderate 0.3 percent in May, but that still left food costs rising at a 6.3 percent rate so far year, well above last year’s increase. People are paying 10.2 percent more for milk than a year ago.
They better get a handle on things, and quick. Our out of pocket expenses, due to gasoline and food alone, have risen a lot more than the 0.6 percent they keep talking about.
– Powered By Stuffr! –
Sphere: Related ContentAn Affordable Risk?
I’m not so sure this is a good idea. Seriously. It’s not usually the down payment that makes the house more affordable, is it?
Fannie Mae, the largest U.S. home funding source, is setting a single national standard for down payments on mortgages it buys, including areas where home prices are falling, in an effort to stimulate the housing market.
On loans it purchases, the company will accept down payments as low as 3.0 percent for single-family, primary residences in all U.S. markets starting June 1. That replaces a policy set in December that mandated higher down payments in markets where home prices are dropping, Fannie Mae said on Friday.
The rule change comes as many in the housing industry call for Fannie Mae (FNM.N) and Freddie Mac (FRE.N), the second-largest federally chartered home funding company, to make more affordable housing available. The two government-sponsored, shareholder-owned companies buy mortgages, freeing up funds for more lending.
I would think that the overall price of the house in ratio to the buyers income would be a better gauge as to what is affordable. Then again, that’s what got the mortgage lenders into the mess they got into in the first place.
Are we trying for a repeat of history by making things “easier” for the buyers to get into contracts they can’t keep?
– Powered By Stuffr! –
Greenspan Sparks Fears Of Recession, Again
Oh Lord, here we go again. Alan Greenspan opened his mouth again. Only this time, he sort of contradicted himself.
One month ago he said that the U.S. had fallen into an “awfully pale recession”, yet at the time and even now we are not yet in a recession. Now, today he says we could face a mild recession.
U.S. economic data suggests the world’s biggest economy could face a mild recession, former Federal Reserve chairman Alan Greenspan was quoted as telling Asian investors on Wednesday.
“He said that the data coming out of the U.S. so far suggests a mild recession. The risk is really on the housing side,” a participant quoted Greenspan as telling a closed-door Deutsche Bank investor meeting in Singapore via videolink from Washington.
Wow, and we could face a mild winter too, maybe we should consult Puxentawny Phil about that? Hell, the U.S. could face a mild _____. You fill in the blank because your comments are just about as relevant as Mr. Greenspan’s.
Oh, and about that “risk is really on the housing side” comment… No shit! We had no idea there was trouble in the housing market! Thanks for telling us, sir.
Color me so not impressed.
– Powered By Stuffr! –
BofA Toys With Countrywide
I thought this was already a done deal? I guess it isn’t over til it’s over, but who knew they could toywith people that way. Oh wait. We did.
Countrywide Financial Corp (CFC.N) shares fell nearly 6 percent on Friday on renewed speculation that Bank of America Corp (BAC.N) will renegotiate or cancel its agreement to buy the largest U.S. mortgage lender.
…
That valued Countrywide at the time at about $7.16 per share. The value of the merger has since fallen to about $3.9 billion because Bank of America’s stock has fallen.
…
Bank of America also spooked investors last week by saying it had not decided whether to guarantee all of Countrywide’s debt. Friedman, Billings, Ramsey & Co analyst Paul Miller said on Monday the bank should walk away from the merger.
They haven’t decided whether to guarantee all of Countrywide’s debt? Huh? I thought when you bought a company, you bought all of it, not just the parts that made you look cool? Doesn’t the debt come with the rest of it? If they choose not to guarantee all of the debt, what happens to it? Someone gets stuck with it, don’t they? They better stay out of my wallet.
– Powered By Stuffr! –
It’s Over, But It’s Not
I bet some people on Wall Street actually peed their pants today when Greenspan spoke. They do that you know. Greenspan farts and those people react.
Former Federal Reserve Chairman Alan Greenspan said on Thursday that the worst of the credit crisis is over, according to sources who attended a speech he delivered in New York.
Greenspan also said house prices still had a long way to fall and that it was unlikely they would stabilize by year-end, according to meeting attendees who provided Reuters details of the speech at the Alternative Public Strategies Conference.
Don’t you miss the days when someone retired and actually stopped working? Why are people still listening to him? Isn’t he part of the reason the “credit crunch” happened in the first place?
– Powered By Stuffr! –
Is Credit Card Reform In Our Future?
Banking regulators have been trying for years to impost more rules on the banks that provide credit card services. Although I am usually against most federal regulatory interference, this is one area where I think something has to be done.
The Federal Reserve on Friday joined other U.S. banking regulators in backing new limits on certain billing practices by credit card companies.
The Fed approved a proposal that would generally prohibit credit card companies from increasing the annual percentage rate on a customer’s outstanding balance. It would also ban companies from reaching back to prior billing cycles when calculating the amount of interest charges in the current cycle, a practice known as double-cycle billing.
…
The new plan would also bar banks, thrifts and credit unions from assessing a fee for paying an overdraft on a checking account, debit card purchase or ATM withdrawal unless they give consumers the right to opt out of overdraft payments.
The proposals also attempt the halt the practice of raising interest rates on a balance when a cardholder fails to make payments on an unrelated bill. The proposal bars banks from changing rates on existing balances, but can tell customers 45 days in advance it might raise rates.
I know many people who have been shafted by credit card companies. Granted, no one gets into credit card debt without knowing what they are getting into, but the way banks are screwing with interest rates on the cards is astounding.
I have a credit card that I have never been late in paying. I have never missed a payment. I have always paid above the minimum due. What happened to me? The bank raised my interest rate because of another issue was not related to my account with them at all, and then, when I paid off 1/4 of the balance, they lowered my credit limit because I was a risk. Ha!
It’s time someone put some limits on the banks. There is no reason for 32% interest rates on credit cards, and there is no reason to screw with people who are actually trying to pay the damn things off.
– Powered By Stuffr! –