Lots of people said it before. Employees owned 30% of the bank because that’s how things work on wall street. They want the employees to be the risk takers. They want as much of the capital of the house to remain inside the house. For those who say that having 401k in your employer shares is retarded obviously don’t understand what a career in finance is all about. 1) Most banks force their vps and up to hold a very significant amount of wealth in bank stocks or funds (ex. GS global alpha was mainly invested by employees). Many go further by lending at discount for executives to buy back stocks from the open market. Be that in 401k or outside doesn’t matter. The amount of wealth will be the same. 2) Most banks don’t allow their employees to put, short, or do anything else that could have downward pressure on stock price. 3) Don’t even think about selling vested shares before 1 year. 2-3 years is usually the norm. Banks do that to align interests, but also reduce the risk of that kind of shit happening. When you have 50% of your wealth invested in the bank stocks, you think twice before doing stuff that puts the bank at significant risk of going bankrupt. And for those of you who think this is a retarded scheme, most of the MDs in banks become filthy rich not because of their cash bonuses but because of the value creation incentive that results from such scheme. Portfolio diversification is nice in theory, but doesn’t compare to the value created by being focused, fully invested, and having a day to day impact on the value of your investment. That scheme is the only good thing left to preserve the teamwork in banks, otherwise everybody would eat each other alive. How do you guys think partnerships work? Do you think GS partners were all a bunch of idiots before they went public? If you fear the risk of losing money or your job, or both at the same time, don’t go in finance.
Whatever happened to the sarbanes oxley act? It was suppose to make companies more transparent? It seems like all these financial companies are doing enron accounting by saying that we don’t know how to value these instruments.
I would never ever ever ever take $2/share. I’d send Bear into Bankruptcy before I took that crappy deal. They’re basically just handing all their wealthy to JPM shareholders because the Fed held a gun to the board’s head…
cosine Wrote: > If you fear the risk of losing money or your job, > or both at the same time, don’t go in finance. Thanks for your post. Do you think it is a good idea that they should have bought some puts?
^ | alot of employees are restricted from buying puts or selling short their companies stock at any time. and cosine, i couldn’t care less if thats how it is on the street, its stupid. and for just this reason. you think the top management (who are ultimately responsible for the company’s downfall) had this in mind when they encouraged such a high ownership level?! just because its common practice doesn’t make it smart. people lost *alot* of money, some a good portion of their life savings…all in a time when its gonna be extremely tough for them to find jobs. to say that there is only *one* possible way to solve the problem of alignment of goals within a bank is nonsense. very few problems in this world have only one way to be solved.
I do and we are up beat in my department
- Yes 2. I do not know.
you must work in equities, prime brokerage, or clearing bc the thoughts throughout IBD and FI Cap Mkts/S&T is that its going to be a massacre
jeff_s Wrote: ------------------------------------------------------- > ^ > | > alot of employees are restricted from buying puts > or selling short their companies stock at any > time. > > and cosine, i couldn’t care less if thats how it > is on the street, its stupid. and for just this > reason. you think the top management (who are > ultimately responsible for the company’s downfall) > had this in mind when they encouraged such a high > ownership level?! just because its common > practice doesn’t make it smart. people lost > *alot* of money, some a good portion of their life > savings…all in a time when its gonna be > extremely tough for them to find jobs. > > to say that there is only *one* possible way to > solve the problem of alignment of goals within a > bank is nonsense. very few problems in this world > have only one way to be solved. Yup, and this is all a recipe for disaster.
From NYT’s Deal Book: 5.March 17th, 2008 4:41 pm During my brief time at Bear [one year to the day], I can attest to the arrogant, thuggish, and utter indifference the Bear Brass have towards their employees. Remarkably, it was the first place I had been where there was no training, no mentoring of any kind, and, for some reason I still do not understand, there are no office supplies given on your first day. I do feel for the small percentage of employees who are educated, articulate, and attempt to survive an otherwise hostile environment on a daily basis. The Bear death rattle was long over due. RIP. — Posted by Former Bear
No office supplies!?! Had I known that I would’ve been short back at $100.
the no office supplies was a cost saving measure… why do you think they never head an unprofitable quarter for so long? bottom line growth.
abacus Wrote: ------------------------------------------------------- > From NYT’s Deal Book: > > 5.March 17th, 2008 4:41 pm > During my brief time at Bear , I can attest to the > arrogant, thuggish, and utter indifference the > Bear Brass have towards their employees. > Remarkably, it was the first place I had been > where there was no training, no mentoring of any > kind, and, for some reason I still do not > understand, there are no office supplies given on > your first day. I do feel for the small percentage > of employees who are educated, articulate, and > attempt to survive an otherwise hostile > environment on a daily basis. > > The Bear death rattle was long over due. RIP. > > — Posted by Former Bear Wow, that’s really bad. They didn’t even give this guy his paper clips? Most employees get 10 paper clips to start their career there…I thought that was a rule at the firm.
I would be so gone on the first day if they didn’t let me have a friggin’ paperclip. Damn.
you missed my group but good guess
well i know you’re not on my floor. i heard some good stuff out of another group not mentioned above but hey if you’re confident they’ll keep your group, good news for you.
When I was there, there was a policy of not using paper clips. It’s just stupid.
Back when I was growing up we had to reuse staples. What I would have given for even one limp paperclip. Kids these days, they have no idea.
good luck jax… you got any leads? I know a few HH’s in NY but I am sure you are already working on that. What do you think of todays email?
i didnt get the email, FI markets closed early and since we cant add any risk we got out very early. shoot me an email if you get a chance, curious to hear what your group has been told. its jackson24nj@hotmail.com