Quote:
Originally Posted by SmootSmack
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It is certainly understandable why people would get upset with that story. It's really tragic that some are making millions while others are losing their jobs, watching the value of their pensions plummet, and losing their homes.
But, keep in mind that WaMu's new CEO had nothing to do with the bank's failure. Moreover, "golden parachutes" aren't as crazy as they sound. Suppose CEO X has a proven track record of turning around struggling businesses, makes $5,000,000 per year at his current job, and has great job security. He's probably a very hot commodity and will not leave his job unless he's paid handsomely and is given some job security (i.e., guaranteed money). That guaranteed money is typically payable if his employment is terminated for no fault of his own and is forfeited for certain bad conduct (e.g., fraud). It's a form of job security and isn't much different from an NFL signing bonus, except it's paid at the end of the employment instead of at the beginning.
Basically, it does suck, but it makes sense.
09-30-2008, 12:47 AM
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