Pay Me Millions But Not With My Company's Bad Stock

[marmar]

from the Working Life blog:



Pay Me Millions But Not With My Company's Bad Stock
by Jonathan Tasini

Thursday 24 of December, 2009


If we wonder why the average person thinks government is dysfunctional and too often doesn't speak for the average person, here is another example (courtesy of The Wall Street Journal):

The top regulator for Fannie Mae and Freddie Mac is expected to announce millions of dollars in pay packages for top executives at the government-run mortgage-finance titans, people familiar with the matter said.

The Federal Housing Finance Agency approved compensation plans for Fannie Chief Executive Michael Williams and Freddie CEO Charles Haldeman Jr. Those packages are expected to be in a range of $4 million to $6 million, people familiar with the matter said. The companies are expected to spell out pay details for their top executives in securities filings Thursday morning.

The Christmas Eve announcement is likely to provoke a fresh round of controversy concerning the federal government's role in propping up the two companies. Taxpayers have pumped more than $100 billion of capital into both firms to keep them from collapsing amid huge losses stemming from falling home prices and mortgage defaults.

And on top of that:

Regulators and company officials went back and forth on how the pay could be structured, in part because executives didn't want to be paid in the companies' low-value stock.

So, in a country where merit is supposed to be a guiding force and, in the new rhetorical mantra, where CEOs should get paid based on the performance of the company, we are now faced with a scenario where two failing financial entities, propped up by a mountain of taxpayer money, still believe that CEOs should rake in a king's ransom--paid for, essentially, by the people...the very people whose wages have been flat for 30 years and who face a long, painful road to claw back to a semblance of economic security...an economic security shaken by the reckless behavior of...the financial titans who now want to be rewarded with millions of dollars...but who do not want to be paid in stock that they fear will be worthless...because of the reckless behavior of the same financial titans.

You can't make this up. Change? Where?


http://www.workinglife.org/blogs/view_post.php?content_id=14640

[Joe Chi Minh]

1. It's way past the time very modest, maximum multiples of the earnings of CEO's

in relation to the earnings of entrance-level staff, akin to that imposed by MacArthur in Japan after WWII - not just here but in the UK and Europe.

If that means they can't finance their life-style with a dozen or so mansions, private jets, ocean-going yachts, etc, from their private fortunes, well they would have to sell what they can't afford, and live within their means. The tax-payers can't keep funding rich, welfare-queens.

[ipaint]

2. That's not even the tip of the iceberg

Treasury uncaps credit line for Fannie, Freddie

WASHINGTON (Reuters) - The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae <FNM.N> and Freddie Mac <FRE.N> no matter how big their losses may be in the next three years.

It also jettisoned a demand that the two companies cut the size of their mortgage-related investment portfolios next year, allowing them to provide even more support in the near term for a housing market recovering from its worst slump in decades.

http://www.washingtonpost.com/wp-dyn/content/article/2009/12/24/AR2009122402367.html




"Forget raising the cap to $800 billion for Fannie/Freddie. They announce (on Christmas eve no less) that the slush fund for picking up toxic mortgage is unlimited:

Treasury uncaps credit line for Fannie, Freddie

The Obama administration pledged on Thursday to back beleaguered mortgage finance giant Fannie Mae and Freddie Mac, no matter how big their losses may be in the next three years.

It also jettisoned a demand that the two companies cut the size of their mortgage-related investment portfolios next year, allowing them to provide even more support in the near term for a housing market recovering from its worst slump in decades.

As Ian Welsh notes, now that the Fed might actually be audited, what better place to stash all those toxic assets than at Fannie and Freddie, where there is no independent auditor since they sacked their own Inspector General?"

http://firedoglake.com/2009/12/24/treasury-okays-unlimited-slush-fund-for-fannie-freddie/


We are being robbed blind. Backdoor extension of tarp.

[glitch]

5. Three-card Monte on METH. nt

[AdHocSolver]

3. Welcome to the NEW feudal society. n/t

[phasma ex machina]

4. $$$ for slick insiders; bad stock to stupid outsiders. nt

[ipaint]

6. k+r nt