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40 Comments
- MayorMcCheapo, on 06/04/2009, -1/+19If CEO's compete in a free market, and the CEO of COUNTRYWIDE is cashing in $140 million in 2006, hmm, let's see... maybe there's a problem with the free market. This isn't the same as complaining why movie stars make $20 million for a ***** blockbuster, this isn't the same as complaining why a sports star makes $20 million a season win, lose or steroid. You can cry "free market" and be technically correct, but the crime is against shareholders, against homeowners, against industry peers, against the public trust. Blame the shareholders? You make is sound so simple. There's a problem here of epic proportion -- isn't that obvious?
- janjamm, on 06/04/2009, -5/+20These are the criminals of "New World Order", committing the crimes of this new century, without a blink of self-loathing. They are the white collar Emperors and they can take whatever they can get, without shame. This is the new world.
- walker4bc, on 06/04/2009, -1/+13The issue here is really passive shareholders. If you don't like the CEO and board compensation (which is clearly disclosed) then either vote the board out (hard to do) or sell the company's stock (easy to do). The best way to force change at a company is to tank the stock.
- wannaBdug, on 06/04/2009, -0/+11The shareholders need to be more aware of what is going on in their company. Awareness is power.
- GreenZephyr, on 06/04/2009, -0/+10As long as CEOs are rewarded for short-term stock gain this behavior will surely be repeated when we move out of this recession and into the next "bubble."
- walker4bc, on 06/04/2009, -0/+9So let me ask you this then, if it isn't the shareholders fault (who can elect the board of directors) then whose fault is it? Who would you expect to make a change? It is EXACTLY like a pro athlete - you can whine about how he should "do the right thing" and stay with the team that drafted him, but when the Yankees are offering $100 million of 7 years and the home town team can only offer a fraction of that, who can blame the athlete from taking the big payday. Likewise, if you offer a CEO a gazillion options, are you thinking he or she should say no? I don't think you are being realistic.
- walker4bc, on 06/04/2009, -2/+11I'm sure plenty of people were up in arms over these compensation packages, but the fact of the matter is that CEO's compete in a free market. If you don't want to pay the CEO that much, then don't do it. I hate it when people rail against CEO pay. Having said that, it sounds like the board compensation in this case was absurd. That is just way too much for someone part-time on a board.
- pinkflyingpig, on 06/04/2009, -0/+9When I see how greed has affected the lives of so many people, I have to believe it's one of the most serious problems our society faces. Through corporate scandals involving greed, innocent workers have lost their retirement savings and their jobs.
- Shatneresque, on 06/05/2009, -1/+10Executives of major companies do this all the time and nothing happens to them. For example, Apple execs regularly divested millions in shares right before earnings warnings:
http://www.crn.com/it-channel/18838055
The SEC didn't do anything about it. Not that long ago they said insider trading was "rampant":
http://www.reuters.com/article/newsOne/idUKN255838 ...
Yet they didn't do anything about that, either. They are *extremely* selective in their enforcement. Years ago they busted some kid who was doing pump-and-dump scams on Yahoo finance message boards, but they never go after much bigger fish on financial news shows and other outlets who do essentially the same thing. If anyone wants to talk about seriously going after fraud, overhauling the SEC and giving it some resemblance of even-handed enforcement would be a good start. - digglakings, on 06/05/2009, -0/+8the whole thing is amazing however. There was a set of lending rules, at some point all mtg companies went "screw those, let's make some loans" the rest is history...
- monkcouver, on 06/04/2009, -0/+7Legally rip off people, "good" job !!!
- walker4bc, on 06/05/2009, -0/+7It is a good point that options are inefficient in that they reward swings in the market and encourage volatility rather than stability and long-term growth. That is why most agree that restricted stock with performance goals tend to better align the interests of management and shareholders.
- viziontx, on 06/05/2009, -0/+5It's not just this guy who took advantage of this stuff, there's a husband/wife/daughter team here in Texas that got caught messing with mortage loan applications...
- inactive, on 06/05/2009, -0/+5Barney Frank and Chris Dodd are the true poster boys.
- mweels, on 06/05/2009, -1/+5Ehhh.... Country wide and the other mortgage companies should have verified employment and made sure people could afford the loans.
By not doing this you artificially inflated the market, took your broker fees, and left investors holding the bag...
You and your cronies are frauds in my opinion. - pinkflyingpig, on 06/04/2009, -0/+4Countrywide used to be my customer; and this company had the most savvy technology and advanced system. The employee were talented and working extremely hard. A bad CEO could bring down the entire company, and this is a truly sad story.
- pingpants, on 06/04/2009, -1/+5If greed fuels the global free market and we're at a tipping point we need smarter answers to fixing the problem. And with that, let's watch Gordon Gekko's "Greed Is Good" ::
http://www.youtube.com/watch?v=7upG01-XWbY - michaelarana, on 06/05/2009, -0/+3I met the guy, being a chauffer for him once, he didn't even tip me. he's still owes me a tip.
- asancho, on 06/05/2009, -1/+4Wait wait, so let me understand this. Applicant lies on his/her mortgage so that they can live in a house they cant afford, and morgage company (Countrywide) turns a blind eye because not only can they collect fees but the people buying the mortgages from countrywide dont really need verification of emplyment. Along with that, Countrywide really doesnt care because realtors get to collect a handsome fee from selling the house and countrywide gets to inflate their stock.
Sounds like a lot of people, from consumer to executive, were playing dumb, and now everyone has to pay. On top of that, the fact that executives cashed out before the economy went south should scream fraudulent. Do you REALLY think they didnt know what they were doing? Cmon. - asancho, on 06/05/2009, -0/+3This is the kind of ***** that is tanking american consumer confidence. These executives think they are above the law, and you know what, the SEC and FBI lets these esxecutives constantly get away with it. You know, if this was the 19th century, these MF'ers would be chased down by pitchfork carrying mobs and hung in the town square...
...so whos with me? Im sure we can find out where he lives and find directions to his house on google maps. - Eorster, on 06/05/2009, -0/+2It was everywhere. I just don't understand why there is not a bigger move to fine the crap out of people who lied on loan applications and brokers/banks that looked the other way.
- mweels, on 06/05/2009, -0/+2Its a lot more than just a few people!! There was rampant
fraud happening!! - Brotoi, on 06/05/2009, -1/+3
So, um, let me get this straight, you're coming into a public forum claiming that Angelo needs to be let off the hook because you, his accountant and accomplice, helped him?
Have I understood that correctly? - Alwaysandnever, on 06/05/2009, -0/+2I'm tired of "CEOs compete in a free market" BS -- the Board's of Directors are filled with good old boy networks in many corporations (not all), and in these cases, the compensation committees rubber stamp all sorts of stuff and then work to limit disclosure. In addition, boards of directors are like baseball team owners; they are afraid of hiring outside of a proven pool of performers and because this pool is artifically small, the group can drive up the price. If board of directors had balls, they would open the hiring process to a truly large group of qualified CEOs (and there are thousands, all looking for the chance to succeed), and thereby have a broad group of choices and not get sucked into a wacky compensation scheme to attract an alleged star.
- mweels, on 06/05/2009, -0/+2The secondary market was so disintegrated they didnt even know what they were buying, until people stopped making payments.
As far as you second point, that happened a lot more than not. Simply running a credit report could have verified their documents. - aheinzm, on 06/05/2009, -0/+1I guess those innocent workers who put their money in risky investments to get a decent return weren't greedy?
The only way you're greedy is if it's
a) someone else
b) someone who makes alot of money - Eorster, on 06/05/2009, -1/+2There are a lot of people, mortgagees and mortgagors, that belong in jail, if it were up to me, or fined for their actions in the mortgage fiasco. No one seems to want to go after them. The documents are in recorders offices all across the country.
- PJ1967, on 06/05/2009, -0/+1You forgot to mention Phil Gramm.
- walker4bc, on 06/05/2009, -1/+2The problem with going after the executives is that there are very clear guidelines about how they are allowed to trade their company stock and if they follow those guidelines, they are somewhat protected. They have to file a plan in which they specify the timing of divestitures and (I believe) describe how they will determine those divestitures. But the plans always give the executives some latitude so if they know the stock is going to tank, they might decide to sell a bit more. It is a pretty gray area and a difficult one to determine how to regulate.
- utopia14, on 06/05/2009, -1/+2The secondary market wasn't asking for verification. Countrywide and every other mortgage company was a middle man. It's not their job to regulate the market. When you have a homeowner that wants a loan and someone willing to buy the note with no proof of income, do you really expect the middle man to say "I'd rather not make this sale."
Now, I knew some less than honest mortgage folks that would forge documents to get someone qualified. That's the kind of stuff people should get in trouble for. - Brotoi, on 06/05/2009, -1/+2
My personal response would be that the SEC should stop being selective and indict all of them. - utopia14, on 06/05/2009, -2/+2I'm a former Countrywide Account Executive and I think Angelo is getting scapegoated here. First off, the guy is 71 years old and he BUILT Countrywide from the ground up. This company was his life's work.
Was some of the stuff going on at Countrywide shady? Yeah, definitely. But the whole country was delusional for about 7 years there. How many hundreds of thousands (if not millions) of Americans were "flipping" houses? I just think we all need to step back and realize that many of us were complicit in this. - coreman, on 06/05/2009, -1/+1The shareholders that count (institutional investors, hedge funds, and the like) just care about the money. If they're getting their x% return, and they've been told beforehand when the music is likely to start going south, they're OK.
The individual shareholder? All in all, just more dust in the wind. The "ownership" line of being a shareholder is a nice myth. - govtdoesnotwork, on 06/06/2009, -1/+1Ask yourselves if we ever had such a disparity between CEO compensation & Janitor compensation back in the "evil" days of the "barbarous relic" gold standard, or if it's a more recent phenomenon. It might be an uncomfortable thought, but you need think it for only a moment. (Then we can go back to condemning Ron Paul for having the temerity to think Congress can/should actually audit the Fed!)
- HomeMortgage, on 06/20/2009, -0/+0I appreciate it very much, at least I know from it someone is reading the contents I have here.
http://www.onthemarkmortgage.com/new-jersey-home-m ... - Brotoi, on 06/06/2009, -2/+2
Do yourself a big favor, NoLibertarians, if your overlords send you to search the house of anyone in my family, knock on the door and be respectful to the person who answers. If you come busting in unannounced you'll find out first hand what kind of "revolution" is needed. - coreman, on 06/05/2009, -4/+3No, they don't. At best it is competition in a relatively small group of peers that all share a goal of scratching each others' backs for mutual benefit.
Shareholders? Feh, short of the self-interest that many of them seem to share to benefit themselves first, everyone else, whatever.
Employees? They can all FOAD.
Then throw in the Heidrick & Struggles, Korn-Ferry, etc. (they are two of the largest executive headhunter firms, working much like player agents in major sports leagues) and the wage/compensation inflation they help drive...
It is most definitely NOT a free market. - NoLibertarians, on 06/06/2009, -5/+4Would you guys stop with the revolution crap. What kind of a "revolution" are you proposing. You're not going to protest and sign petitions, are you? Because we all know how effective that is
- utopia14, on 06/05/2009, -1/+0Yes, a lot of financial wizardry being done by many different institutions guaranteed that there wasn't much of a check to rampant credit granting. But again, how do you blame a mortgage company for this? An underwriter's job is to determine if the loan can be packaged and sold. Determining the global implications of the subprime mortgages, derivatives, etc is above their payscale, and frankly Angelo Mozilo's too.
As someone who has run thousands of credit reports I can tell you two things about your second statement. 1.) Income is not reported in any way. 2.) Current Employer data is wrong more often than it's right. - Brotoi, on 06/05/2009, -4/+2
Then perhaps it is time for a new revolution.
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