Sunday, November 4, 2007

Off with their heads!

The financial press mob has formed and appears to be rolling out the virtual guillotine while howling for the heads of nearly every top investment bank over the past few weeks. The crescendo has risen as further deep losses have been revealed by many of these institutions.

The recent decapitation of O'Neal from Merrill leaves Citigroup Inc's Charles Prince, Bear Stearns Cos Inc's James Cayne and Countrywide Financial Corp's Angelo Mozilo at the top of the list of prominent U.S. chief executives hunkered down in the their corner offices trying to deflect blame. Recent news indicates that the Citigroup saga will end today with the resignation of Prince; although this will not likely appease the media rabble but rather serve to further feed the frenzy. The press horde was not apparently pacified by the recent changes at ABN AMRO where Rijkman Groenink has recently left, or at UBS where Peter Wuffli was forced to walk the plank a few weeks back. Each day new articles are shouting for more heads to roll.

Will this spill over into an increasing list of investment banks; even Goldman’s where Mr Blankfein has been recently upheld as an example of active and able management. Will Ken Lewis over at Bank of America survive as risk management practices and investment banking services have come under scrutiny? The list created by the press continues to get larger as well as the increasing angry buzz of the articles. Has someone started a pool on which corner offices will be vacant by the end of the year?

Other CEOs under microscope as Merrill chief exits

Report: Citigroup CEO May Resign
Citigroup CEO Will Offer to Resign Sunday; Board Expected to Hold Emergency Meeting


Anonymous said...

The tone of this blog suggests a certain empathy with these "heads". I dont see why? Did these banks not take inappropriate risks? Were these problems not evident for quite some time now? Should these heads have taken necessary steps to fire the people in their organizations early enough?

Now they will get some absurd golden parachute, stay on several boards and spend time in the hamptons. Big deal.