Today's financial wizards finally do something never done before--lost money
On the heels of Goldman Sachs posting its fist ever quarterly loss, Bear Stearns Cos. said Thursday a bigger-than-expected writedown in its mortgage portfolio caused the nation's fifth-largest U.S. investment bank to post the first loss in its 84-year history.
It took a $1.9 billion writedown in the quarter ended Nov. 30 as its mortgage-backed securities continued to lose value amid the global credit crisis. That was much larger than the $1.2 billion it expected in November.
Bear Stearns' fiscal fourth-quarter loss, and collapse of two hedge funds it managed during the summer, prompted Chief Executive Jimmy Cayne to pass on his 2007 bonus. Members of the company's executive committee also will not receive year-end bonuses.
For more go to Yahoo News.
Last year Bear Stearns paid Chief Executive Jimmy Cayne $40 million, a 32 percent raise, after the firm reported its fifth straight year of record profit. (but built on poor lending practices and soon to be record losses...Don't you just love Wall Street "wizards?")
Cayne got a $250,000 salary, a $17.1 million cash bonus, $14.8 million in stock, $1.69 million worth of stock options and $6.15 million in other pay.
So as I see it, even giving up his cash bonus this year, the man has been paid obscene amounts of money in the past and still makes obscene amounts of money to screw up this year. It's no wonder that candidates such as Edwards, Obama, Clinton, Paul point fingers at the corporations for the ills of the world. Nobody on my block is going to have any sympathy if corporations get hit with taxes, penalties, what have you when most of us simply lose our jobs if we screw up or when the corporate heads screw up for us.