Merril Lynch CEO wants 10 mill bonus

IMO, means in my opinion, amigo.

I certainly know a couple of Louisiana companies that I've owned for over 30 years. I know the players, attend stockholder meetings, and keep up closely with company. My mother was once an executive at one of them, so I have some insider knowledge as well. I girl I knew very well in high school is now on the board of the other. She is just holding down furniture there and voting as she is told, in my opinion.

On other stock, I've owned . . . I only know what the companies want the stockholders to know, like everybody else--plus whatever news my daily searches turn up on the companies and their sectors. But I pay close enough attention to know that I don't agree with executive compensation more than any other issue with most companies. Only those companies that have executive salaries and bonuses that are closely tied to objective performance figures are doing the proper thing, in my opinion.

I won't reject a stock that overpays it's executives, if it makes me money, but I still feel like they are stealing from me and the Board is rubber stamping it for them. And when they foul up, tank the company, and lose everybody money, they still get those huge bonuses and golden parachutes. It makes me very cynical of the cozy relationship between executives and the Board, while the owners are spread out so thin that they have little collective voice. In my opinion.

 

As a newly-promoted manager, I couldn't agree more:hihi:

 

Well, the reverse ia also true by that criteria. What working knowledge of the effectiveness of the majority of BODs in the country do you have to make the statement that they are all doing a great job?

 

Stockholders are not a dumb as you imagine. This insider pay approval has led to US executives making substantially more than their counterparts in Japan and Europe. The U.S. stands first in the world with a ratio of 39:1 CEO's compensation to pay of manufacturing production workers. CEOs in the S&P 500, averaged $10.5 million annually, 344 times the pay of typical American workers. Levels of compensation have been rising dramatically over the past two decades and on a far steeper curve than rank-and-file pay and stockeholder profits. That is a problem for me.

It has been documented that the return on investment from high executive pay packages is very poor compared to other outlays of corporate resources. The U.S. Congress is currently debating mandating shareholder approval of executive pay packages at publicly traded U.S. companies.

GM's CEO made $9.3 million last year. Chryslers new executive got a $210 million severanc epackage from Home Depot to go there. Fords CEO got $27 million inclduing an $18 million signing bonus.

Compare that to Toyota whose top 37 executives earned a combined $21 million. At Honda the top 21 earned a combined $11 million. do I need to pint out that the Japanese carmakers are kicking ass and the American ones need a bailout to stave off bankruptcy?

Executive compensation in this country is way out of hand, both comparatively with other Western countries that are competitive with us and historically since they make far more of a percentage of the company profits than they did 20 or 40 years ago.