Bye bye, Thain.

A few moments ago, BofA CEO Ken Lewis (our hero) and Merrill's former chief John Thain hashed things out in what was referred to as an "emergency meeting", trying to determine what exactly Thain's future will be at the new Bank of Merrill, or whatever the hell it's going to end up being called.

Looks like Thain's hitting the road, according to CNBC. Perhaps his lavish spending had something to do with it. Here's a list of a few of the renovations he did to his office when he came on board at Merrill:

Area Rug $87,784
Mahogany Pedestal Table $25,713
19th Century Credenza $68,179
Pendant Light Furniture $19,751
4 Pairs of Curtains $28,091
Pair of Guest Chairs $87,784
George IV Chair $18,468
6 Wall Sconces $2,741
Parchment Waste Can $1,405
Roman Shade Fabric $10,967
Roman Shades $7,315
Coffee Table $5,852
Commode on Legs $35,115

My, but we've come a long way from just a few months ago when the merger was first announced and Thain was hailed to become head honcho when Lewis retires. Everything was coming up roses back then, until Merrill dropped their $15.31 billion-loss bombshell forcing BofA to beg the government for another handout to keep from going under. Now Thain has become more like Lewis' bastard stepchild than the prodigal son that he was hailed as in months past.

Who knows, maybe we'll be rubbing elbows with him in the unemployment line.

Comments (109)

Jan 22, 2009 - 1:41pm
jackofalltrades, what's your opinion? Comment below:

In his defense, I'm sure that Thain didn't simply go on lnt.com, add those items to cart and press check out. The interior decorator that BofA hired was most likely instructed to make sure that Thain (a card-carrying master of the universe) was greeted with a baller office, as he should be. BofA made TTM 46 billion rev.

Think about your own office. are you sitting in a $1,200 aeron chair? are you crunching models on a $2,000 computer with multiple $400-$800 monitors? Do you make calls on a $300 avaya telephone? Did your company shell out $300 for a new blackberry and does it pay your $150 monthly bill? Do you make $60,000 base in your first year out of college? The perks begin one day one at the lowest level and just get better as you move up.

To quote an anon commenter from dealbreaker: "1) Think of the facilities budget for ML. That amount would be lost in the rounding. A three day cold snap will increase the heating bills by 5x that much. 2) Most of the stuff on the list is hard assets, not like the $1.2 went down the toilet."

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  • 3
Jan 22, 2009 - 2:25pm
sbmerchant, what's your opinion? Comment below:

If you read the story in the WSJ it is clear that Thain was fired and given the option to resign.

"Bank of America had lost confidence in Mr. Thain, this person said, after Mr. Lewis learned of mounting fourth-quarter losses at Merrill from the transition team handling the Bank of America-Merrill merger rather than from Mr. Thain himself. And when Mr. Lewis asked Mr. Thain what happened, the Bank of America CEO did not get a "good explanation for what was happening and why," this person said."

"The Bank of America CEO also concluded Mr. Thain has exercised "poor judgment" on a number of fronts. He left for a vacation in Vail, Colo., after the losses came to light, bonus payments at Merrill were accelerated so they could be collected before the end of the year and Mr. Thain had planned to fly this week to Davos, Switzerland, even though Bank of America had signaled that such a trip was not a good idea, this person said."

Thain represents what is wrong with Wall Street and why it collapsed. Sad to say, Bank of America and their walmart ways represent the future. I would have fired him too if this story is true.

Jan 22, 2009 - 2:36pm
MDR, what's your opinion? Comment below:
sbmerchant:
Thain represents what is wrong with Wall Street and why it collapsed. Sad to say, Bank of America and their walmart ways represent the future. I would have fired him too if this story is true.

Thain did his job--like I said before, he got his shareholders and employees paid. He inherited the problems at Merrill from Stan O'Neal. Ken makes two of the most inept acquisitions in history (and overpaid to boot), and has show absolutely zero strategic thinking in the way he's managed that company. And by managed, I mean by the way he drove boa stock into the ground. I think a commentator on dealbreaker put it the best: "I love how the retarded guy gets duped and buys a bum company then fires the smart guy for selling it to him. Lewis is guiding this ship right into an iceberg"

Thain wasn't fired because of the decorating bill, this is obviously a power move by Lewis. Anyone with half a brain knew that Thain was in-line to take the company over, this was Lewis' way of maintaining control.

Jan 22, 2009 - 2:28pm
sbmerchant, what's your opinion? Comment below:

Frankly, it sounds like a lot of high flying Merrill employees have not been too gracious to the fact that BoA saved all of their jobs. They instead entered the firm with their noses up and did their best not to join their new team. A bunch of stuck-up and over paid snobs that deserve what they got imo.

Jan 22, 2009 - 3:05pm
ideating, what's your opinion? Comment below:
sbmerchant:
Frankly, it sounds like a lot of high flying Merrill employees have not been too gracious to the fact that BoA saved all of their jobs. They instead entered the firm with their noses up and did their best not to join their new team. A bunch of stuck-up and over paid snobs that deserve what they got imo.

Lol give me a break... another classic college kid thread.

"Oh man, that's like 20 analyst salaries for his office furnishings." "Man, what arrogant bastards!"

Merrill employees are bitter because many of them have done everything that was asked of them and they still got screwed. You worked hard all your life, did well in school, got the job, did well in your job and now your firm is bankrupt, your colleagues and friends have been fired, you are constantly stressed and BoA takes over. It's well and good to armchair quarterback and castigate those "arrogant snobs".

Also, there is SO much more waste that goes on than office furnishings. Do you guys have any idea what the actual acquisition cost is per analyst/associate in a recruiting cycle? Your salary is a small part of the overall bill to obtain and maintain your services. How about the real estate cost of maintaining an office in midtown? Why not relocate to Jersey? Thain represented a pretty major figure in the BoA organization, who gives a shit what he spends on office furnishings.

Jan 22, 2009 - 2:51pm
saidso, what's your opinion? Comment below:

Thain is a joke I dont understand this whole smartest guy on the street garbage that everyone talks about.

I would however like to know what it feels like to take a dump on a $35k toilet

Jan 22, 2009 - 3:12pm
sbmerchant, what's your opinion? Comment below:

So far I have yet to see anyone address the facts mentioned in the article.

But hey, "I STRONGLY DISAGREE!" posts without any sort of response to actual facts posted and making blind assumptions are always welcome. ty King Kong.

I guess I'm a college kid because I disagree with you, right?

Jan 22, 2009 - 3:29pm
ideating, what's your opinion? Comment below:

What facts?

Thain screwed BoA and Ken got mad. Guess what, that was Thain's job - maximize his shareholders' value.

Thain went for a vacation and went to Davos - so many details missing from this, it's ridiculous to draw any sort of meaningful conclusions.

Thain pushed for bonuses to be paid before EOY - ok, maybe a dick move to enrich his ML guys but again a lot of detail missing here. And don't tell me that BoA is that incompetent that they let him push it through improperly.

I'm speculating that you're a college kid because of your half-formed, jejune conclusions.

Jan 22, 2009 - 3:52pm
sbmerchant, what's your opinion? Comment below:

1) You are not speculating. You are assuming. Insulting assumptions detract from any point you are trying to make. I'd expect you to realize that.

2) I am very clearly not operating on all real world facts. I am operating on the article I quoted. Notice where I stated "if this story is true."

3) You failed to address any of the points brought up in the article and instead addressed those ridiculous office spending rumors.

The first paragraph I quoted is especially important. Regardless of whether or not he was trying to maximize value for his shareholders, his job was NOT to misrepresent the deal to BoA. It was his responsibility to accurately display the costs and future costs associated with the deal and maximize his shareholders value based on the facts. It sounds like he messed up quite a bit. The fact that BoA heard this information from someone besides Thain himself is pretty terrible. Anyone who was competent and had a sense of dignity would have immediatly addressed these issues and met with the CEO. Not only did he screwup in representing the future costs associated with the deal, but he also screwed up by not being on top of the situation. Combine that with the second paragraph and it looks like the guy is damn near trying to get fired. Why would you rush to hand out bonuses, not address the unexpected cost issue that is blatantly obvious, then go on vacation instead of trying to deal with the issue?

The guy either purposely mislead BoA to maximize his shareholders value (and then rushed to get bonuses out the door before everyone found this out) or he is incompetent. So, he's either a scumbag of the highest degree or he's an idiot. Take your pick.

If you see it another way then feel free to enlighten me without the "college kid" remarks. If it makes you feel better, I can assure you that I graduated several years ago.

Jan 22, 2009 - 4:32pm
Cornelius, what's your opinion? Comment below:

Na Na Na-na Na Na Na-na Hey Hey Heyy Goodbye!!


The world has changed. And we must change with it.

------------ I'm making it up as I go along.
Jan 22, 2009 - 4:53pm
dipset1011, what's your opinion? Comment below:

Thain definitley takes care of his own. Anyone else catch part of the article where it states his driver made 230k all in?

As Borat would say " it's nnniiiiiiiiiicccceeee"

Jan 22, 2009 - 5:04pm
MDR, what's your opinion? Comment below:

sbmerchant:

When you take corp fin. 101 next semester, they're going to tell you this: #1 job of a CEO is to MAXIMIZE SHAREHOLDER VALUE, not play nice with competitors.

The article you copied in isn't stating any facts pointing to Thain being a "joke"--it's actually demonstrating how stupid Lewis is. Kenny wants an explanation from Thain about the losses, but guess what, Thain inherited those toxic assets from Stan O'Neal. There's a little something called "due diligence" in deal making--that's when you make sure you know what you're buying before you pay a 70% premium at a time when valuations are dropping like panties on prom night. Thain is a genius, he maximized shareholder value and made sure his employees got paid.

Jan 22, 2009 - 6:38pm
laxn103, what's your opinion? Comment below:

Thain - "Hey Ken would you want to buy my firm?"

Lewis - "That sounds interesting let me do some research and get back to you."

Lewis- "Were gonna buy it, it will be a great deal and work great for both of us."

Thain- "SWEEEET!"

Lewis- "You have to leave John, you should have known we would not do a lot of due diligence on your firm and that no one would be able to predict this market. You lead me on like a schoolgirl! It's your fault I took my massive firm and bought you!"

Jan 22, 2009 - 7:19pm
sbmerchant, what's your opinion? Comment below:

LOL k guys. Maximizing shareholder value includes lying and manipulating the transaction, right?

Bullshit. This is part of why Wall Street is getting bent over and fucked in the ass right now. This culture of "maximimizing shareholder value no matter what" is not self sustaining. It is exactly what lead to the collapse of our financial industry.

Thain is either a deceiving scoundrel or he made gigantic mistakes and is incompetent.

Jan 23, 2009 - 12:09am
thedude, what's your opinion? Comment below:

what? you really have no idea what your talking about. only mistake Thain made was appearing to live completely within his means (opulently) while his firm prepared to take it in the butt. The problems at ML he inherited and can hardly be blamed on him, he didn't even work at ML before becoming CEO. And yeah, if ML wasn't sold when it was, the shareholders (the people that own the company; the ONLY people who he answers to) would have been far worst off. BoA, made a big mistake for jumping at a "quality" name without really attempting to understand the entire balance sheet and they are getting their just reward. BoA is insolvent, and its only a matter of time till the shareholders are wiped out, but its not the CEO of another company's problem, that is for sure.

Jan 23, 2009 - 10:41am
stk123, what's your opinion? Comment below:

Just heard Obama on CNBC taking a cheap shot at Thain. He said that we need better oversight of the bailout (TARP) money and that we cannot allow for companies to take taxpayer money and use it to remodel offices and bathrooms.

Come on Obama get your facts straight, Thain remodeled his office over a year ago. Just shows how clueless our president really is about what's going on. Or maybe he is purposely misrepresenting facts to push his own agenda, like he did in his campaign.

Oh yeah and his stimulus package is now going to create 3-4 million new jobs - seems like he is adding an extra million every week.

Jan 23, 2009 - 10:54am
Devils Advocate, what's your opinion? Comment below:

Great Obama is tapping into the populist sentiment already.

And for the love of God, Lewis is the fool for overpaying. What the hell did he think he was buying? Every goddamn person was wondering why they didn't do what Barclays did with Lehman in order to get a toxic-stripped, clean firm.

Now Thain and Fleming are gone. God knows how many ML execs are going to run for the exits when the opportunity presents itself.

Jan 23, 2009 - 7:23pm
stk123, what's your opinion? Comment below:
IBnutz:
thain didn't work there a year ago

Thain redecorated his office a year ago when he started at Merrill not BoA.

Now everyone on CNBC (and probably every other news channel) is acting like he redecorated with TARP money, which is not true,. What a bunch of morons.

Obama's plan worked, he made us believe in something that is not true by misleading us. Great Leadership!

Jan 23, 2009 - 2:52pm
Antbgs1293, what's your opinion? Comment below:

Although I agree with most of the comments, I feel Thain was in a position where he had to maneuver strategically. The economic conditions were horrendous, access to capital markets were limited, also he had just previously finished one of the biggest equity offering's in history consequently diluting his shareholders. His firm was in the process of losing massive value. For example, the immense write down of CDO's earlier in the year were sold for twenty two cents on the dollar to a PE firm. Those CDO's were responsible for the majority of Merrill's previous quarterly lost. Subsequently, as the chief executive officer Thain didn't want his company's mortgage exposure to result in a collapse similar to Lehman. Capital markets weren't providing the recapitalization Merrill needed. BOA was the perfect fit for a buyer;Lewis wanted to strengthen his brokerage unit and Merrill was the firm to do it. Lewis is known for his aggressive mentality to buy his revenue streams as CEO.
I blame Ken Lewis for not doing the appropriate due diligence not only in terms of qualitative analysis, but also quantitatively. He should of expected their was a intricate rationale for a legendary firm like Merrill Lynch selling itself to BOA. He should of hired top tier advisory bankers to analyze what their assets were really worth in these current economic conditions. Thain was a desperate seller and Ken Lewis was the buyer who should have considered the counter party risk.

Jan 23, 2009 - 3:53pm
jackofalltrades, what's your opinion? Comment below:

During our sell-side pitches, one banker loves to chime in with "the person who submits the highest bid for your business will either be the smartest guy in the room or the stupidest."

I think that's catchy

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Jan 23, 2009 - 6:48pm
PatrickBateman, what's your opinion? Comment below:

Thain is a royal jackass. Obviously his redecorating isn't what brought down Merrill, but this type of extravagance, especially during such tough times is exactly what gives wallstreet/finance its bad reputation. This is also why it is so damn hard to get bailout money, and get bailout plans passed in congress and it kills investors confidence in the leadership of large finance players. Thains actions are no different than those of Bernie Ebbers, they should both be in jail. Oh, and not that it matters but Cramer agrees with me....he is on in the background.

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Jan 23, 2009 - 7:28pm
trade4size, what's your opinion? Comment below:

In the end a few fixed income traders brought down ML. I would love to see where they actually lost that 15bn which has crippled BofA if not for the govt. The BSD's deserve a good John Bobbit. Too bad they will still be perceived as demi gods and go to a HF and lose more money down the road. This is John Meriwether all over again. Ego Maniacs that dont know how to take a loss on bad investments.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
  • 1
Jan 23, 2009 - 7:35pm
Antbgs1293, what's your opinion? Comment below:

You guys talk a lot about industry leaders as if they don't deserve any respect. But, I bet you would go work for their institutions. Not all leaders make good decisions in finance and I'm aware of that. We've had a president who made bad choices for two straight terms. To offer your negative opinion constantly with ignorant blunt remarks without understanding circumstances shows your immaturity. Even though executives such as Dick Fuld, John Thain, Alan Schwartz have been under scrutiny amidst the financial meltdown. I respect their rise in the corporate ranks and their names will be remembered in history.

Jan 23, 2009 - 8:35pm
DontMakeMeShortYou, what's your opinion? Comment below:

No they won't. People will remember the firms but not the names. Sure, we're in finance, we know them, but the lay person does not and never will.

Jan 26, 2009 - 12:53am
Eddie Braverman, what's your opinion? Comment below:

John Thain Is Back! (Originally Posted: 06/19/2013)

Not that he ever really went anywhere, it's just been a long time since we've heard anything from him. And that's because he's been busy doing what John Thain does - maximizing shareholder value like it's his job. This is a great interview with Thain from last week, and the guy's poise just amazes me. After making a laughingstock out of Ken Lewis in 2008 he moved on to save CIT from the brink and now they're kicking ass in a big way. He also hints that another 2008-style crisis is all but inevitable. No word yet on when they're installing the $25,000 shitter in his new office, though. This guy's a BOSS:

Jan 26, 2009 - 12:54am
RichardPennybags, what's your opinion? Comment below:

Just went on the wiki page for him - apparently:

"Thain has been nicknamed "Superman", due to his facial resemblance to the character's alter-ego Clark Kent."

LOL, really?

I can't get the image of him starring in the Man Of Steel out of my head now...

"Every man should lose a battle in his youth, so he does not lose a war when he is old"
Jan 26, 2009 - 12:56am
Benjammin822, what's your opinion? Comment below:

This still completely taints my perception of him:

http://dealbreaker.com/2009/01/john-thain-to-get-canned-for-having-fabulous-taste/

Jan 26, 2009 - 12:57am
Eddie Braverman, what's your opinion? Comment below:

God, if anything that increases my esteem for him. Amidst all that excess he was still able to convince the CEO of Bank of America that his bankrupt company was worth $50 billion and then convince him to pay out their annual bonuses before the dope figured out he'd been had.

Heard anything from Ken Lewis lately? Didn't think so. Thain made Lewis unemployable.

Jan 26, 2009 - 12:58am
justin88, what's your opinion? Comment below:
Edmundo Braverman:

God, if anything that increases my esteem for him. Amidst all that excess he was still able to convince the CEO of Bank of America that his bankrupt company was worth $50 billion and then convince him to pay out their annual bonuses before the dope figured out he'd been had.

Heard anything from Ken Lewis lately? Didn't think so. Thain made Lewis unemployable.

Ken Lewis made Ken Lewis unemployable... Thain was just the catalyst.

The CFC acquisition is widely regarded as the worst bit of finance-sector M&A in history.

Jan 26, 2009 - 12:59am
Pitbull Class, what's your opinion? Comment below:

The matter of fact here remains anemic growth and that companies do not want to hire workers: the "unnecessary expense".

As he said, he is in an asset sensitive arena, and if rates go up, it will boost Cit's B/S.

Since you are in France, have you thought about doing a post on Le Bourget -the Paris Air Show ?

Winners bring a bigger bag than you do. I have a degree in meritocracy.
  • 1
Jan 26, 2009 - 1:01am
BillBelichick, what's your opinion? Comment below:

Dude is a great turn-around banker. Would be a really smart imaging and finance move to hire him if I were, let's say, a UBS.

Jan 26, 2009 - 1:02am
total, what's your opinion? Comment below:
justin88:
Edmundo Braverman:

God, if anything that increases my esteem for him. Amidst all that excess he was still able to convince the CEO of Bank of America that his bankrupt company was worth $50 billion and then convince him to pay out their annual bonuses before the dope figured out he'd been had.

Heard anything from Ken Lewis lately? Didn't think so. Thain made Lewis unemployable.

Ken Lewis made Ken Lewis unemployable... Thain was just the catalyst.

The CFC acquisition is widely regarded as the worst bit of finance-sector M&A in history.

I'd love to see that pitchbook.

Jan 26, 2009 - 1:04am
Ihavenoclue, what's your opinion? Comment below:

This man is a badass. Got to respect this man's game, even if i think some the stuff he pulled of were not the most ethical. lol

Jan 26, 2009 - 1:05am
elcaudillo, what's your opinion? Comment below:

John Thain is Superman, except instead of x-ray vision he can see into all the insecurities of the guy on the other side of the table and then maximize his firm's value to the nth degree by executing a plan to kryptonite the sht out of the other guy.

Jan 26, 2009 - 1:06am
mhgbostcap, what's your opinion? Comment below:

Truth be told.....that was way more Greg Fleming getting Ken Lewis to pay out of his a$$ for Merrill than John Thain. JT didn't want to sell the firm at all and was much more interested in getting Goldman to take a 10% stake then in selling firm. Obvious reasons though....wanted to stay CEO of Merrill.

Matthew H. Greene Senior Vice President, Corporate Recruitment & Talent Acquisition Bostonian Capital Management Company MA: 617 419 3295 / CT: 860 249 0791 / NYC: 917 210 3029 [email protected] WWW.BOSTCAPITALMGT.COM
Jan 26, 2009 - 1:07am
affluenza, what's your opinion? Comment below:

It's good to be Thain (Originally Posted: 12/08/2008)

Merrill's chief, and soon to be head honcho of BofA, is recommending that he receive a bonus of $10 million for the year. He feels he deserves it because he kept the firm's annual losses to a mere $11.67 billion. Meanwhile, stock prices have gone from over $50 a share at the time Thain came on board to a Friday close of $13.

Do you guys really think it's the right time to be barking up that tree? How many think he deserves it? I know you Thain lovers think he walks on water but keep in mind that he got $15 million when he signed on with Merrill in 2007 along with his current annual salary of $750k.

I'm interested to see what the rumblings are on this? Particularly from the many who won't be getting jack for a bonus this year.

  • 1
Jan 26, 2009 - 1:08am
ARD45, what's your opinion? Comment below:

With all the forfeiting of bonuses by executives industry wide, I don't think it's smart that anyone openly suggest such a thing. He's bound to get some bad press from this. If it was some sort of incentive-led bonus then that might be different.

Jan 26, 2009 - 1:10am
greenman101, what's your opinion? Comment below:

Absolutely not. He should be in the unemployment line like everyone else imo.

This sub-prime mess is a direct result of people not understanding the product they were dealing with and selling. It goes all the way up the chain of command to the upper management. How could you be exposed to something so dangerous and have no idea? It's relatively simple once you understand how everything works.

He may not deserve to be blamed for any of these problems, but that certainly does not mean he is warranted a $10mm bonus when everyone else at the firm is now unemployed. Times are tough and they should be tough across the board. If he had a shred of dignity in him he wouldn't be asking for a bonus. He'd understand that it's a bad year, and he is lucky to have the opportunity to stay employed at his level of responsibiltiy. His employment will certainly warrant future bonuses of similiar or larger calibre; there is no need to be demanding one this year. His request proves that he is an ass.

Jan 26, 2009 - 1:11am
orbithal, what's your opinion? Comment below:

absolutely not...there's no question that he's done a great job, but I don't see how he can rationalize deserving a $10MM bonus when boa/ML are about to lay off maybe 30,000 people. He might have saved the Merrill by engineering that sale, but he was still a part of the system that fucked up enough to get us to this point to begin with.

Jan 26, 2009 - 1:12am
stk123, what's your opinion? Comment below:

He sold off most of Merrill's bad assets in July, when nobody else did. And he saved the company and tens of thousands of jobs by selling it to BoA just before it was too late.

By the way, when he signed up last year he was expecting to earn something like $85 million dollars and as you stated he got $16 million or so. I know that this is a bad arguement, but how would you feel if you took a job at a HF (for example) expecting to earn a $1 million, but it ends up going down 20% and you "only" get paid $200K, I am sure that you would be asking for more as well; especially if you were to put in a lot of hard work and the fund's weak performance was not your fault.

Jan 26, 2009 - 1:13am
saidso, what's your opinion? Comment below:

Only on wallstreet does someone "deserve" to get paid a bonus because he lost less money than someone else. He deserves nothing.

Jan 26, 2009 - 1:14am
pedigreed monkey, what's your opinion? Comment below:

i think thain deserves a bonus much more than many other wall street CEOS, i.e. the ones that watched as their companies collapsed into bankruptcy.

that said, i think Blankfein "deserves" one too yet GS led the pack in saying no bonuses for top 7 execs. given this, it's a really bad move for Thain to be asking for a 10MM bonus when the public perception of wall street and i-bankers is at an all time low and the US economy is facing the worst economic crisis since the Great Depression. makes him and his company look really bad, both as a firm and as a stock. why would anyone invest in a company that is losing billions while still paying its CEOs huge bonuses? Ben Graham told us to avoid these companies in Intelligent Investor, and i trust what the father of value investing has to say.

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Jan 26, 2009 - 1:16am
greenman101, what's your opinion? Comment below:

Well, what a lot of people don't realize is that he was brought in specifically to save the company during a time of distress. So, he did a very good job from one perspective and deserves some compensation for doing his job well.

On the other hand, he was COO of GS for quite some time and participated in much of the same practices that sunk the other banks. In other words, he is deserving to be out of a job IMO because he didn't recognize that he was dealing with toxic products when he should have been well aware of it. However, this was before Merrill so it shouldn't have much to do with his compensation at Merrill.

And then there's the entire economy. Hundreds of thousands are out of work, and many big shots are forsaking bonuses in the name of good faith. Yet this guy is asking for a $30mm bonus (he was talked down to $10mm) in the face of all that's going on? I'd say that's a little much.

So, he did a good job during the 2 years he ran Merrill and you can make an argument that he deserves compensation for that. However, he hasn't done anything differently that sets him apart from his peers during the rest of his career (regarding this mortgage melt down and investment banks participation in said meltdown), and now he is asking for a gigantic bonus in the face of his entire company and country melting down financially due to his and his peers past performance. It's a bit of a tough decision in my opinion.

The deciding question for me is: How many of the hundreds of thousands of people losing their jobs right now were doing an excellent job but still got a pink slip? Ya, he should take that into consideration before demanding a bonus like some asshole.

Did his performance warrant a bonus? Yes. But sometimes there just isn't room for bonuses. Demanding one when there's obviously not room for one is in poor taste.

Jan 26, 2009 - 1:18am
xqtrack, what's your opinion? Comment below:

if Merrill had actually "dumped most of their bad assets in July", there would be no need for a shotgun sale. No toxic assets = no bank run = ML should be pulling a profit, not an 11 billion loss = ML shareholders doing much better than $13 a share.

this guy is a fucktard. he's firing half his employees, lost shareholders a ton of money, and wants 10 mm for the job well done? the ONLY people who should get bonuses right now are the traders who made 100 mm+, and bankers who can individually trace their books to big deals, because they might credibly be able to walk out. and even then, these bonuses should be reduced heavily.

right now, banks need to preserve capital or spend it on loans, not on giving bonuses to crappy executives who drove their companies into the ground.

Jan 26, 2009 - 1:22am
stk123, what's your opinion? Comment below:
xqtrack:
if Merrill had actually "dumped most of their bad assets in July", there would be no need for a shotgun sale. No toxic assets = no bank run = ML should be pulling a profit, not an 11 billion loss = ML shareholders doing much better than $13 a share.

They did dump most of their bad assets.

The problem is that good assets are also going down in value, which means they have to be written down according to FAS 157.

Since banks were leveraged 30:1, a 3% decline in all asset values would wipe out the entire equity capital. Even a very small decline in prices causes huge write downs.

Banks rely on short term financing, so if all lenders decide not to lend money to a bank one day, that is considered a run on the bank and that is why they could fail like BSC, LEH. Banks are at the mercy of their lenders.

I will not comment on the rest of your post.

Jan 26, 2009 - 1:20am
dixm655, what's your opinion? Comment below:

Seems as if Andrew Cuomo also had a thought on Thain's request to receive a bonus this year:

http://nymag.com/daily/intel/2008/12/andrew_cuomo_literally_cannot.html

Jan 26, 2009 - 1:24am
affluenza, what's your opinion? Comment below:

Thain to keep his job! (Originally Posted: 10/02/2008)

Well, I don't know about you, but I know I'll be able to sleep better at night now knowing Merrill's John Thainwill being staying on after the BofA acquisition. He'll be the new head of Investment Banking and is supposedly going to be the successor of BofA CEO Ken Lewis. I mean, who cares about the 27,000 employees rumored to be heading to the unemployment line in a few months? And that's just at BofA. Who knows how many "little people" from Merrill will be sent packing. But, rest assured, one of the billionaire bigwigs is safe. I for one feel so much better.

  • 1
Jan 26, 2009 - 1:26am
yesman, what's your opinion? Comment below:

thain was brought in to get ML out of this shit - it was his predecessors who got them in this mess, and they're gone. thain's an ideal executive

Jan 26, 2009 - 1:27am
MMBinNC, what's your opinion? Comment below:

Answer me this...what did Thain do wrong? Thsts right almost nothing. He didnt get Merril into that shit but he got them outta it.

So what do you do? -I work for an investment banking firm. Oh okay; you are like my brother, he works for Edward Jones. -No, a college degree is required in my profession

Reality hits you hard, bro...
Jan 26, 2009 - 1:29am
b2, what's your opinion? Comment below:

Thain's the man!

Jan 26, 2009 - 1:30am
philosophical monkey, what's your opinion? Comment below:

Oh good old John ... his younger daughter is pretty hot too; she's a senior this year. :)

"Categorical Imperative: If I cannot look at my mother or my wife in the eyes and explain it, I won't do it" - Some British MD.
Jan 26, 2009 - 1:32am
prospie, what's your opinion? Comment below:

John Thain is not a billionaire, moron. He is an employee, and a valuable enough one that he is being kept around.

Jan 26, 2009 - 1:35am
philosophical monkey, what's your opinion? Comment below:

I don't know about the Lazard stuff, but the year before that she was an M&A analyst with Citi -- when good ol' John was president of the NYSE and one of Citi's biggest cliets ...

In all fairness, she goes to a good school and is an abstract math major with a high GPA; and like I said before, she's pretty hot too. Ah, I like to flatter myself and think I almost got lucky... :)

Her sister, though, interned with Goldman while her dad was COO there ... in Paris to boot!

"Categorical Imperative: If I cannot look at my mother or my wife in the eyes and explain it, I won't do it" - Some British MD.
  • 1
Jan 26, 2009 - 1:34am
philosophical monkey, what's your opinion? Comment below:

"He is an employee, and a valuable enough one that he is being kept around."

WTF do you know moron? Thain is an executive--NOT an employee.

"Categorical Imperative: If I cannot look at my mother or my wife in the eyes and explain it, I won't do it" - Some British MD.
Jan 26, 2009 - 1:36am
prospie, what's your opinion? Comment below:
philosophical monkey:
"He is an employee, and a valuable enough one that he is being kept around."

WTF do you know moron? Thain is an executive--NOT an employee.

LOL at people who use the term "executive" to mean something impressive. Like real estate agents trying to sell a 6-bedroom house as an "executive home."

It's not like Thain FOUNDED Merrill Lynch. He just works there. His shares amount to one twentieth of one percent of the company. The truth is, your precious "executives" WORK FOR the board, and can be replaced.

Jan 26, 2009 - 1:37am
philosophical monkey, what's your opinion? Comment below:

"LOL at people who use the term "executive" to mean something impressive. Like real estate agents trying to sell a 6-bedroom house as an "executive home."

Where did you read the word "impressive" in my post? Right, it's not there. There is, however, a fundamental difference between a worker and an executive. I don't have time to explain this to you.

You just don't get it. It's obvious.

I hope you realize board members can and are replaced as well. No one is eternal or permanent in this business. But, again, what would you know?

"Categorical Imperative: If I cannot look at my mother or my wife in the eyes and explain it, I won't do it" - Some British MD.
  • 1
Jan 26, 2009 - 1:38am
Eddie Braverman, what's your opinion? Comment below:

Did Thain actually ask for $40 mil??? (Originally Posted: 02/09/2009)

I'm taking this with a grain of salt so far, because it might just be another hit piece on Thain from New York Magazine. But the magazine is reporting today that John Thain did not ask for a $10 million bonus for orchestrating the Merrill takeover. In fact, they allege, he asked for $40 million.

http://nymag.com/daily/intel/2009/02/john_thain_bonus-gate_round_th.html

Now I like to think I've got some balls but, if this report ends up being accurate, Thain has a set for the record books. I knew I liked this guy.

Jan 26, 2009 - 1:45am
affluenza, what's your opinion? Comment below:

Thain in Hot Water Again (Originally Posted: 02/23/2009)

The former CEO of Merrill, recently canned by BofA bigwig Ken Lewis (yeah, cuz he's an angel) and publicly shamed for his extravagant spending of company funds on interior decorating in his office, remains tight lipped about the early payout of bonuses to his employees prior to Merrill's merger with BofA.

He's under the microscope for the decision to bump up the payment of millions of dollars in bonus money to December, conveniently before the merger went through and while his company was steadily losing billions, ultimately posting a $15 billion loss in just the fourth quarter alone.

Thain refused to answer when questioned by NY Attorney General Andrew Cuomo about the bonus acceleration. Apparently he's hiding behind BofA lawyers.

I know the hard working employees of Merrill who were lucky enough to get a bonus were happy (especially when most of us don't have a snowball's chance in hell of getting one these days), but the way he did it was shady. And I'm sure the thousands of employees waiting for their pink slip as a result of this disastrous merger would tend to agree. I wouldn't mind seeing him go down. In fact, where's the dude who punched Fuld in the face when you need him?

  • 2
Jan 26, 2009 - 1:46am
Eddie Braverman, what's your opinion? Comment below:

Every college kid hoping to get into banking should have a t-shirt with Thain's picture on it like the hippie losers that wear Che Guevara t-shirts.

The only thing Thain is guilty of is being one step ahead of the retards at B of A.

Jan 26, 2009 - 1:49am
Eddie Braverman, what's your opinion? Comment below:

Thain Goes Back to Work (Originally Posted: 02/08/2010)

It was only a matter of time before Clusterstock's 2008 CEO of the Year John Thain emerged from his self-imposed exile and went back to work. In true Thain style, he chose a company with the potential to restore him to rock star status.

Thain is joining embattled commercial lender CIT Group as Chairman and CEO, effective immediately. No word on whether the company has begun its search for antique commodes and priceless area rugs yet.

"John is a well respected financial services executive and proven leader who is uniquely qualified to lead CIT at this critical stage," said CIT lead director John Ryan in a statement. "We have the utmost confidence in John and are pleased to welcome him to CIT."
I think the plan is for Thain to rehabilitate CIT to the point that it looks good on paper, and then to sell the company to whomever Ken Lewis ends up working for down the line. When a strategy works, you stick with it.
Jan 26, 2009 - 1:50am
MMBinNC, what's your opinion? Comment below:

The article is hilarious and spot-on. Thain made a genius move, and if he can do what he did for Merrill (pre-sale) he will probably help CIT.

Reality hits you hard, bro...
Jan 26, 2009 - 1:51am
IB13, what's your opinion? Comment below:

Good for him, He's not a bad guy at all. Should see his appearance at Wharton, You can really hear a decent man speaking.

Jan 26, 2009 - 1:53am
tdr34, what's your opinion? Comment below:

Someone should probably tell BOA now that CIT is not an attractive buying opportunity.

Jack: They’re all former investment bankers who were laid off from that economic crisis that Nancy Pelosi caused. They have zero real world skills, but God they work hard.
-30 Rock

Best Response
Jan 26, 2009 - 1:58am
Eddie Braverman, what's your opinion? Comment below:

Thain Working His Magic at CIT (Originally Posted: 08/02/2010)

Love him or hate him, John Thain is working wonders over at CIT. The man who was simultaneously voted best CEO of 2008 by Clusterstock and worst CEO of 2008 by Fortune seems to be turning things around at the embattled lender. The company just posted its second consecutive quarter of profitability and the stock is up 40% for the year.

"We improved our funding flexibility, repaid higher cost debt, streamlined our portfolio and largely completed the build- out of our senior management team," Thain said in the statement.
I have a lot of faith in Thain's abilities as a turd polisher par excellence. The way he PWN3D Ken Lewis will be the stuff of Wall Street legend for decades. Of all the carnage during the crisis, Thain is the only one who escaped unscathed. Sure, you might point out that he eventually got fired, but how many Merrill guys really wanted to work for BofA anyway? As far as I know, he got to keep the commode.

Thain embodies maximizing shareholder value, for good or ill. Some may argue that he isn't the most ethical guy on the street, but if you're a shareholder in one of his companies you're generally a happy camper. I imagine a lot of Merrill shareholders still hang a framed picture of him in their homes next to the Pope and Jack Kennedy. We won't even mention his Merrill crew who cashed their accelerated bonuses before Kenny discovered the emperor had no clothes.

Sometimes you bet on the horse, sometimes you bet on the jockey. Even a nag like CIT is showing up under Thain's whip, and shareholders have to be pretty pleased.

Now we just need to find a job for Dick Fuld. For a guy with his people skills, I'm thinking something in customer service, or investor relations...

Jan 26, 2009 - 1:59am
The Young Investor, what's your opinion? Comment below:

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Yours truly, The Young Investor
Jan 26, 2009 - 2:00am
IFeelVolatile, what's your opinion? Comment below:

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Look at that subtle off-white coloring. The tasteful thickness of it. Oh my God, it even has a watermark.

Jan 26, 2009 - 2:01am
moranges, what's your opinion? Comment below:

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"Despite a voluminous and often fervent literature on 'income distribution', the cold fact is that most income is not distributed: it is earned." -Thomas Sowell
Jan 26, 2009 - 2:02am
Solidarity, what's your opinion? Comment below:

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Jan 26, 2009 - 2:03am
Eddie Braverman, what's your opinion? Comment below:

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Jan 26, 2009 - 2:04am
TheBenevolent, what's your opinion? Comment below:

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