After Tuesday’s sharp drop, the major averages tried to find some footing yesterday from which to move higher. It turned out to be a see-saw day, but we ended up slightly to the upside much to the relief of many investors. We now have to wait and see if these levels hold or if we are heading further south again.
All eyes are now on the compromise stimulus package, which will need to win congressional approval.
The big bankers faced some tough questions from Congress as to whether they’ve used the TARP funds appropriately or not. They all conceded, by putting on their politically correct face, that the economy would probably be in worse shape today if the TARP program had not been enacted in October. Yeah right, as opposed to saying that it was a complete failure?
Speaking of failures, here are some highlights from an article called “N.Y. attorney general blasts ‘secret’ Merrill bonuses:”
New York Attorney General Andrew Cuomo has accused Merrill Lynch & Co. of secretly moving up its bonus payments to assure they were paid out to the firm’s executives before fourth-quarter losses — more than $15 billion — came to light.
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Cuomo also detailed how the bonus pool was spread among staff.
He said that while the bonus pool encompassed 39,000 employees, the lion’s share went to a relatively small number of executives. “Merrill chose to make millionaires out of a select group of 700 employees,” Cuomo said.
Cuomo’s office determined that $121 million was doled out to the biggest four bonus recipients, who were not identified by the attorney general.
The next four biggest beneficiaries split a total $62 million in bonuses, while another six divvied up $66 million.
As to the size of individual bonuses, Cuomo said 14 staffers got bonuses of $10 million or more and 20 received bonuses of at least $8 million, while a group of about 200 got $3 million or more.
“These payments and their curious timing raise serious questions as to whether the Merrill Lynch and Bank of America boards of directors were derelict in their duties and violated their fiduciary obligations,” Cuomo said.
That’s nice. It supports my view that Merrill Lynch should have been left to die a peaceful death so that other businesses would have had an opportunity to pick up the leftover pieces of value, dissatisfied clients, for example.
As it turned out, taxpayers are now supporting their questionable marriage to Bank of America, and I have no doubt that this alliance is doomed to fail.
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