It’s hardly the soup kitchen for people at the very top.
The chairman of Lehman Brothers, Richard Fuld, still has his mansion in Greenwich, CT, his oceanfront estate on Jupiter Island in FL, and his Park Avenue co-op in Manhattan.
Many at Lehman blame Fuld for dallying while his investment bank went bust, taking risks with other people’s money while he cleared over $40 million in salary and stock in the last year alone.
Fuld could not be reached for comment by 20/20, but outside the Lehman offices this week, employees took glee in telling him off in pen on a portrait of Fuld.
“He made a lot of money and he lost a lot of money,” said Fox business news anchor Alexis Glick, “and he made dramatic mistakes, mistakes of the highest magnitude.”
Glick has been highly critical of Fuld, feeling the pain in a direct way. She has many friends at Lehman and her mother worked there for years.
“It’s just unbelievably shocking,” said Glick, speaking about the devastation felt by her family and friends. “So they’re crying, they’re sick, I mean guys have been telling me they’ve been throwing up because they just can’t stomach what has happened.”
Fuld isn’t the only top executive who remains well-off despite his firm’s collapse. Former Bear Stearns CEO Alan Schwartz collected more than $38 million in salary and bonuses in the last three years for which figures are available, though he and Lehman executives also saw their net worths drastically plummet as stock values crashed. Bear Stearns was on the brink of financial ruin when JP Morgan Chase bought it in March.
Full article: The Fall of the Gilded Age
IS BAILING OUT LEHMAN REALLY NECESSARY?
Shouldn’t we wait until their CEO had to sell one of his three luxury homes before bailing out Lehman?
It really seems like we’re rewarding these guys instead of letting them naturally get picked clean and displaced by smarter competitors.
Obviously we do need to do something to restore confidence in our banking system. I recently overheard nurses talking about pulling their money out of banks and hiding it at home (1930s-style) for fear it’d disappear in a bank collapse. That’s how serious the problem is getting. I’m not saying do nothing. I don’t have an issue with helping out banks like IndyMac or Washington Mutual, but bailing out rich Wall Street investment firms seems a whole ‘nother animal.
The $700 Billion financial “bail out” bill seems to be all about providing a soft, pillowy landing for stupid decision-makers at taxpayer expense. They keep their three luxury homes, and we pay the price for their idiocy.
And articles like this only highlight the unfairness:
7. Do the Wall Street executives get to keep their bonuses?
The Bush Administration says it needs to encourage executives to get their cooperation, and that clamping down on their pay would only hurt their willingness to get on board. Critics in both parties say the threat of the executives’ firms going belly-up should ensure their cooperation regardless of what restrictions are placed on their once golden parachutes. Mounting pressure from constituents on Main Street is likely to mean there will be some cap on compensation associated with the bailout. But corporate America usually finds a way around such limitations, and there are even legal questions about what kind of restrictions can be placed on the firms’ compensation structures.
Full article: 7 Questions About the $700 Billion Bailout
If this disaster really requires $700 BILLION worth of government intervention, who is paying for it? My first instinct when corporations harm us, is TRUST-BUSTING! And this meltdown is a screw up of unprecedented magnitude, with harm to the public of historic proportions.
Where are the CONSEQUENCES for bad, stupid leadership?
Can anyone tell me why, as part of this bill, the Treasury Department isn’t seizing CEO yachts and mansions to pay for this debacle? Why is demanding real consequences worse than paying nearly one trillion ourselves? We’d rather foot the bill in their stead? WHY??
If these idiotic decisions by Wall Street have no real consequences, and the dumbasses responsible keep their three estates and golden parachutes, no real lessons have been learned, we’re basically incentivizing even more stupidity down the line.
And now Congress has weighed in. They are saying:
I’m not saying do nothing. But clearly we have to do something different. The original Paulson plan isn’t going to fly. We can’t afford a cushy deal for the uber-rich.