Moment of Silence.
Stan O'Neal, the 56-year old CEO of Merrill Lynch & Co. has been forced to leave his job due to a significant multi-billion dollar write-off he announced last week. Although his departure was rumoured to occur, it was surprising how quickly the board was willing to oust Mr. O'Neal.
Mr. O'Neal became the highest ranking African-American on Wall Street - rising from the cotton fields of Wedowee, Alabama, to the top position at Merrill Lynch.
What Happened?
(Highlights from The Wall Street Journal)
- Mr. O'Neal's downfall in some ways seems related to last week's announcement that Merrill would write down $8.4Bn in the 3rd quarter - the largest loss in Wall Street memory
- Many were shocked by the speed with which the board threw its chief overboard
- Mr. O'Neal was credited with boosting Merrill's profitability and transforming it from a US focused retail broker to an international financial giant
- Historically, Merill's board gave Mr. O'Neal a lot of leeway because he more than doubled the firm's profit level to an average topping $5Bn annually from 2003 to 2006
- Some former colleagues say Mr. O'Neal's talent and steely drive came with one tragic flaw: he didn't engage much in debate, kept his own counsel and had little use for the kind of strong-willed subordinates who might have helped him steer clear of the subprime troubles that brought him down
- In the early years of his tenure, which began in 2002, Mr. O'Neal purged the firm of many of its longtime senior employees and later fired some of those considered his allies
- The final straw was Mr. O'Neal's unilateral decision to ask Wachovia Corp. CEO G. Kennedy Thompson, a longtime client of the firm, whether he would be interested in buying Merrill. Mr. Thompson demurred, but the move's appearance of desperation - particularly since Wachovia just acquired a big St. Louis brokerage and now rivals Merrill's brokerage in size - offended some of Merrill's directors, brokers and some executives who were unaware of the overture
Sad times. But, Stan's exit package is estimated to be worth over $160 Million. He is still negotiating.
Good luck, Stan!!
Who is Stan?
http://en.wikipedia.org/wiki/Stan_O
2001 HBS Profile: http://www.alumni.hbs.edu/bulletin/2001/june/profile.html
For recent update on the Stan O'Neal saga see:
http://kerijam.blogspot.com/2007/10/stan-oneal-made-bank.html
1 comment:
RE: the Golden Parachute pay package for Merrill's CEO Stan O'Neil.
Why should anyone get $160 million dollars when they are fired? A $7.9 Billion writedown and people losing houses.
In today's WSJ Oct 30,2007 is the story of another Black man. He was as a Sophmore in high school convicted of rape and sent to prison. He is in his 40's having spent most of his life in a brutal prison as a rapist. He was cleared by DNA testing. What was his exit package? $150,000 total. $6,500 for every year in prison.
How about Stan O'Neil step up to the plate and donate his $160 million for the convicts now cleared of crimes.
How many jets and yachts does he need? Does anyone need the 10,000 to 20,000 square foot houses this pay buys?
Does anyone need over a few million dollars total? What a sick nation. No wonder this nation is so despised around the world.
Our president is spending multi Billions on two wars which we started. Using our money to murder innocent people. Now President Bush refuses to sign a bill passed by Congress to fund medical care for children.
My previous suggestion was to give CEO and other executives convicted of crimes a choice. I am not speaking of Mr. O'Neil but convicted white collar criminals who defrauded millions of dollars. Make a federal law that these super multi millionaires can choose to donate their salary and option profits from the previous years for an equivalent reduction in time served.
Use this money to fund children's health care. Also have the government either state or federal donate the saved cost associated with the prison terms to children's health care.
If some of the absurd wealth of CEO income is distributed to the poor then maybe people around the world would see this nation as is should be, a Jewish, Christian or Islamic giver not a Satan.
Warren Buffet in today's WSJ gave his best advice.
"I have more money than You but what sets me apart is that i get up in the morning and do the work that i enjoy."
Notice he donated most of his money. He did not even want to take the time off from his loved profession to give it away. He gave his money to Mr. and Mrs. Gates who he knows will use it wisely.
If someone wants to run a company then let them do it for fun. Yes compensate them decently then give them the huge amounts only if they fund worthwhile charities in their names and the company's name. Let their names go down in history as givers and great men not Robber Barrons. (no pun on the excellent magazine.)
Most of you will answer that economics determine the best CEO. Pay more and get more. I was an Econ major at the University of Washington. The best man will be someone who loves his work and will do the best job to reward stockholders, employees and customers.
No i am not a Socialist, Christian or Muslim. I read the Bible and the Quran, The Economist, Business Week, Investor's Business Daily and the Wall Street Journal. I day trade stocks full time at home on three computers. I love it.
I have always chosen jobs or a business that gives me joy. I had been a river raft guide at 32 and a commercial salmon fisherman. $40 a day and $150 for the entire season.
Tom Robbins had the best advice on religion in Fierce Invalids Home from Hot Climates. My favorite novel of all time.
"I practice all religions and believe in none."
As soon as someone believes then the battles begin and the purpose of the religion is destroyed.
Most people in the United States call themselves Christians. Would Jesus, not his so called church, have accepted $500 million in preaching fees?
Mecca before Islam was a religious site visited by many. One of the original tourist towns. Islam was started when Mohammed saw his tribe in Mecca become capitalistic and move away from the tribal public support of the poor including widows and children. He meant his religion to unite the world, including Christians and Jews, in honoring one God whatever His or Her name. The basis was to care for others in this life.
Now his religion also has been stolen to oppress and murder. The only comparison of religion is how many have been tortured and murdered in the name of their Brand of God.
I expect Jesus, Mohammed and all the other religious men and women are having a good time together but shaking their heads at how poorly their intentions were carried out in their names.
Robert J. Lanier
Dedicated to my beloved daughter, Marin Lanier, who i hope will use her kindness and do only good deeds in her life.
For search use, she did not write this.
Marin Caribia Lanier
Robert Jochem Lanier
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