A top Lehman exec’s lament

I work for a company that had been impacted by Sarbanes Oxley, a bill that was supposed to avoid this very thing,, My company has spent MILLIONS every year trying to manage this. Our people have had to take their eyes off the services we offer in order to manage this audit crap. I don’t think we should continue to foot the bill. Most of our jobs are going overseas as it is and this SOX bill has cost Americans so much, that transition is happening at an alarming rate! To the companies that have to support the mega corporations, we need to fight back and ask those corporations to fund any audit preparation and resources to perform these endless reviews that apparently mean nothing.

If every single person in America was given that $2,300 est. cost per person (yes, children too) for the bailout; given that money in credit to restore credit reports – now that’s a populist measure that might make some sense to the average person. I am encouraged to learn that Americans are not buying the image being propagated by the elites — this is the fault of those foreclosed home owners that “we” never should have lent to. B.S.! Let’s not blame the average family – they’re already struggling and have been for years – carrying the weight of bloated executive salaries getting their COLAs every year. Executive salaries in corporate America, as well as higher education, social services, transportation and other government entities, has been soaring for well over a decade. As long as the growing chasm between the rich and everyone else, is allowed to continue, this country is doomed to fail. The greed of Wall St. has been celebrated, lampooned, envied, and attacked…but not everyone is getting their own in America anymore. The impoverished are growing. So too is suffering. And leadership, in any sector, seems extinct.

If there is no accountability whatsoever, and people (essentially bank robbers) continue to drive around in fancy cars and live in fancy houses while 95% of other are sub-middle class, there will come a tipping point. This is a societal stage we in the US haven’t seen yet (at least in our generation). While we scream for justice to those who have run companies into the ground and get away with it (and often handsomely), if justice is not served, such folks better watch their backs. Civility can only be maintained for so long before…people need to start hiring body guards and bulletproof cars/houses.

If you think that’s crazy, rewind a few years and imagine what you thought of those talking about the possibility of most Wall St. banks going under in a matter of months.

i audited thrifts back in 02-03 and had a hard time valuing the “crap” they had on their books. Major thrift chief contacts my firm manager and i get the change the statements and opinion letter or else. I took the or else. Started my own firm to really audit companies, best day of my life. A lot of blame to go around; thrift execs, outside audit firms, employees, and the person who bought the property and did not realize his payment will triple in a short period.

It is scary to have the Feds in charge of the largest loan companies, insurance companies, less government is best govenment. Too much politics involved in the government running the show, and for the most part the US gov can’t even project in the 1930’s that; people will live longer, the country’s population will grow, and social security is a really stupid idea. YOur best security is your own wits.

For a soft landing of a 2000 recession(don’t let the politicians fool you it started June 2000, i audited trucking companies their revenue dropped dramatically in July thru 01).

It is not GWBushes fault our education system stinks and folks don’t understand housing sales contracts(liberals have controlled education since 1961). The bank i audited knew they had crap products on the books and still pushed them, when a i said reserve billions and i will write an except for opinion for this junk, i was a boat rocker. The leaders of these companies ran the companies into the ground and should have to give up their personal assets as with most high level employees.

As for the young man 22 from the Midwest you are young and even though this is stressful, you will learn more in that year or so than most learn their whole career. Keep your head up and remember that LEH sold crap that looked like manure and smelled like manure, and yes it turned out to be manure. When my large Accounting firm eased me out the door i had my head held high knowing someday the cards would all fall and i was right. Now, the accounting profession is getting back to doing auditing the right way, like i have always tried to do. I never thought the employees, the CEO, or their audit commiteee was my, client, the shareholders were the client. I did not care what the empty suits thought as long as the real owners of the company of the shareholders got the right information. Keep your head up though, you sound like you have some talent and drive, that is definitely missing in our youth. I started my firm after being escorted out the door and have built my firm to over 30. YOu can do the same. Good luck to ya, my prayers are with ya.

Starting with Enron and WorldCom, the amount of disproportionate wealth given (or taken) to/by a few executives has been an abomination of the free enterprise system. Later, when their corporations collapsed, the negative impact on the lives thousands of their loyal (and mostly honest) employees who were simply “making a living” working for those companies is incomprehensible. Now once again, under a different set of circumstances, thousands of employees of major companies are being “led to the career and financial slaughter” by the mismanagement of their greedy “Super-Egotistical” senior management, supported by their “yes to everything” BODs.

Before people accuse “big bonus execs” of greed and knowing nothing of the real world, they might want to do a little research. Byrne is one of many who pulled herself up by her bootstraps. Judge not, lest ye be judged.

It has been such a terrible last few days and the worst part is that it is still not over. My husband works/worked at Lehman and I can tell you this weekend was the most unsettling weekend we’ve ever had. From thinking there would be a buyout, to preparing for bankruptcy to seeing a glimmer of hope the emotional rollercoast has been extreme and exhausting. I wrote an article about the experience if you would like to check it out at: http://www.bettyconfidential.com/ar/h/a/a01913.html

Financial sector big bonus executives deserve no sympathy. They have caused a mess which has lead to ordinary salaried folk loosing savings. In addition to job losses, the people responsible need to be prosecuted and put behind bars.

They knew too well that lending money to people incapable of paying back is foolish. Greed overtook sense and they should suffer.

The lesson learnt should be for capitalism to prevent bubbles by regulation. Dot com bubble, asset bubble, we dont want your clever schemes anymore!!

At least the dot com left us with a brilliant internet infrastructure as a side-effect. This one will just leave rotting houses and worthless shares.

A sorry state of affair for all those associated with LEH. Hope for a better future for all out of this episode.

I’m 22 year old kid from the midwest and worked my ass off to get to Wall Street. The firm I happened to settle on was Lehman Brothers and now I’m just a 22 year old kid from the midwest, with no job despite working my ass off.

I totally agree with –

“Welcome to the real world Wall Street Executives!!!! For years you guys and gals took us regular folks money and most likely lost it or gave us meager returns while you enjoyed major millions in bonus and golden parachutes.

Don’t you guys know you do not give home loans to people with no down payment and not enough income to make monthly payments? ”

Firms like Lehman hires the best and the cream of students and none of you who are demanding an apology from Fuld saw this coming. None of you planned for an unforeseen issue. People who are talking about their educaiton funds getting wiped out, should have invested better. Oh I am sorry you are in the investing banking sector correct but oh, you are also the ones who got us all in this global mess! Cheers to your degrees!!

There seems no accountability and no leadership anywhere anymore. Why do we select men/women with so little character or integrity for our most important positions? Look at the path of destruction one person has caused.

I do not feel sorry for these executives, especially not the one stupid enough to bet his child’s education fund on LEH. However…

…I think that the majority of the comments on here reek of money-envy – most of you sound pathetic (especially the back office guy who is whining about getting fired from his grunt job).

What bothers me even more though, is the complete lack of acknowledgment for personal responsibility. Anyone complaining about Wall Street “playing” with their money should take a step back and figure out whether they should be investing in companies they do not understand.

Sure, these LEH guys should not be selling crappy products. However, these products are not forced down anyone’s throat. People who cannot afford a particular type of mortgage should NOT be taking one out. All parties directly involved deserve everything that is happening to them.

The people I feel sorry for are those affected indirectly, e.g. the stupid LEH exec’s kid.

Brown…whoa there…the problem as you see it started when the Senate Banking Committee wanted to start overseeing subprime loans…ummm no. The loans were fine until they reset which is a function of interest rates. All of the sudden the secondary market was flooded with poor quality loans. Loans that a responsible banker would not have made. Add to that the deregulation of the credit swap derivatives…implemented by Phil Gramm..I think he still has a job on wall street…and poof! It was a matter of time before it happened…the housing market got very speculative and overvalued. If the rise in housing values kept going it was going to be ok, people would refi..but then alot of middle class jobs have been shipped overseas which added to the problem. FNMA and FHLMC exacerbated the issue by lowering their standard as well so what they were buying from banks and mortage companies were of lesser and lesser quality. Wall Street and the mortgage bankers got greedy and now they are paying for it and unfortunately alot of ancillary jobs have been wiped out to go with this. Brown..your analysis is shallow and barely holds water…I know I was a banker until 2001…anyone who had any reasonable knowledge of this knew…that the slightest economic irregularity would pull this whole thing down…and it did..

Lehman got themselves into them mess. Sorry Charlie. That is the way it works. Inept management. The idiots that worked there should have read the writing on the wall. Why should the taxpayers bail them out?

If the hamburger stand down the street goes out of business because of a crappy product should the government bail them out also?

Blaming Bush is idiotic. Last time I checked George W wasn’t the CEO.

Ms Byrne alluded that some of her affiliates may “move to Montana to escape it all.” How misguided that some of our “best and brightest” still don’t get it. How fortunate for them they have your and my money to “escape” with.

For all those who have subscribed to the conservative mantra of “small government” – take a good hard look at your “superior” private sector. Our supposed best and brightest minds – FAILURES. At least the government informs the people when it plans to relieve them of their hard-earned money. The private sector does so without notice – and in devastating fashion. So what’s the solution – regulation, or more of our “the market will solve everything” approach? Is greed & irresponsibility better than regulated bureaucracy? This American is not so sure anymore..

Do you really think the politicians had that much to do with it? Back in the 1980’s (were you around in the 1980’s?) the Investment Banks went through a transformation from private partnerships to publicly traded stock companies. The net effect was that the Investment Bankers (the partners) cashed out and now the capital of the firm was owned by the stockholders.I’ll bet many of the guys who worked a good deal for a good profit left to clip coupons for the rest of their lives. The remaining guys got greedy and now looked at deals in a different light. It was no longer their personal capital at risk; it was the shareholder’s capital.The rest is history… the soundness of the deal didn’t matter because the long term drain on capital could be masked by accounting that was indecipherable to most shareholders. This month the house of cards came tumbling down because the chasm between perception and reality became too wide to bridge.

Brown are you clueless?
Did you actually expect to let the government let the charade run forever? It is the governments responsibility to stop financial disasters from occurring. You are suggesting that the government should have just looked away and let the liar loans etc go on. What we have seen this past year would have been nothing compared to the financial devastation that would have come. An industry kept afloat by a pack of lies is bound to crash. Better now then when it would be even worse. The foolishness is incomprehensible!

blame the dems right! georgie boy and the republicans been writing fat checks fueling a runaway train to long! It had to crash some time! the fallout isn’t over, this administrations ways will have to be paid for, and we all will pay! so buckle up!!

Wow Brown, a little knowledge can be a dangerous thing, eh? You sure draw some messed up conclusions. I’m not a fan of Democratic fiscal policy by any means, but Republicans have controlled congress for 14 of 16 years, and the Presidency the last 7.5 years. I typically hesitate to blame any President for the business cycle, let alone a few stupid comments made by members of a democratic congress that for 1.5 years has had little power to do anything against a Presidential Veto. Legislation like that passed by Republican Phil Gramm in 1982, and much more similar legislation over the past two decades, have slowly eliminated safeguards in the financial systems in the name of deregulation. That, and pure greed, creating a house of cards known generically as derivatives, whose value outpaced all ‘real’ capital in the U.S. Systems by a factor of 10 or so if I recall correctly, are the drivers of this mess as best i can figure. Subprime loan defaults were just the trigger. If not that, it would have been something else. The tower was ready to crumble, whether via earthquake or storm it doesn’t matter. A few stupid comments by congress didn’t start this, and frankly if that sort of thing had this sort of economic result, we’d be a third world country. I would say that the (Republican)administration was very slow to recognize something that’s been very visible even to clued-in laymen like me for months if not years. I reacted in Mar 2007 by protecting my $, long before the gov’t acknowledged a problem via word or deed. I think the real issue is that sometimes it’s difficult to tell the gravy train from a ponzi scheme, or when one becomes the other. I can see blaming greed, or even Republican Leadership, but if the words of democratic congressional leaders were that powerful, I daresay the state of the union would be quite different today, whether that be for good or ill in your opinion.

How come people outside Wall St see how ridiculous and dangerous housing prices had run up compared to wages, inflation, and GDP? And then when a bubble bursts do we feel especially sorry for workers who had years of 6-figure bonuses while manufacturing jobs of much more modest terms have been disappearing for decades in the U.S.?

Welcome to the real world Wall Street Executives!!!! For years you guys and gals took us regular folks money and most likely lost it or gave us meager returns while you enjoyed major millions in bonus and golden parachutes.

Don’t you guys know you do not give home loans to people with no down payment and not enough income to make monthly payments?

I sincerely hope the people who spend tax payer money do not bail you out. I am tired to pay my taxes only to see them wasted on wall street hi rollers and executives bail outs. Sorry to see the secretaries and little people get laid off, about time the wall street hi fly boys and gals have to work for a living.

Regardless of what happened with LEH I think it’s a sure bet that the company’s top execs will not be worrying about paying for gas or trying to make rent. Some will say: “that’s the way the market should work..” and I agree but if the fed is going to bail out one they should bail them all out. Why play favorites now basically they screwed the taxpayers over royally under the “Bush” watch so I think they meaning the Fed and all involved should keep screwing the middle class “us” and continue to put money into the hands of the clearly incompetent rich execs and maybe, just maybe their pockets will become so full that some of the taxpayers money will spill out in to the hands of lower and middle class.

The facts are;
Until the Democrats took over the House and the Senate AMERICA WAS PROSPERING!!!
The Housing Market fell off the cliff the same month Chris Dodd became the Chairman of the Senate Banking Committee. Read his acceptance speech and focus on the items he intended to address and fix. http://dodd.senate.gov/index.php?q=node/3680

FIX, you got to be kidding! Once he attacked Predatory Lending (code for Subprime), Mortgage Banks failed/closed rapidly, and limiting resources for millions of homeowners to refinance out of their adjustable loans. But what He/or the Democrats didn’t understand was that was a needed/necessary tool in the housing market. Fannie and Freddie Mac needed subprime, millions of B/C borrowers needed subprime.

If New Century, Fremont, Option One, Ameriquest, Long Beach, Delta Funding, WMC Direct, First Franklin were still in business, MILLIONS OF AMERICANS would have the options available to them to get out of FORECLOSURE. Subprime was not the evil that it was sold to the American public to be. As you now see, it was the tool that was needed to keep the American Housing Industry afloat. More people achieved the American dream of Homeownership under George Bush than any President, more minorities too. Now more people will lose the dream, more people will lose their equity savings to send their children to college, more banks will fail, the FDIC will fail under the Democratic House and Senate than ever before..
The entire USA mortgage industry is under the control of the government. Where is free-enterprise???

The unemployment rate soared to a nearly five-year high in August 2008 as employers trimmed jobs for the eighth straight month, the government reported Friday.

The unemployment rate rose to 6.1%, the HIGHEST level since September 2003. That’s up from 5.7% in July and 4.7% a year ago.

In addition, the economy suffered a net loss of 84,000 jobs in August, according to the U.S. Department of Labor, compared to a revised reading of a 60,000 job loss in July.

The U.S. economy has lost 605,000 jobs so far THIS YEAR ALONE.

In the face of these numbers, after 8 years, supported 90% of the time by McCain, Bush says:

“While these (jobs) numbers are disappointing, what is most important is the overall direction the economy is headed,”

Tell that to the 605,000 families that are now without income to buy food, clothing, or provide shelter for their families.
Manufacturing lost 61,000 jobs, while construction employment fell by 8,000. But the job losses were widespread and went beyond those two troubled sectors.

Retailers trimmed 20,000 jobs despite the back-to-school shopping season, which for many stores is typically second in sales only to the holiday period. Business and professional services – a broad category that includes industries such as accountants, consultants and legal services – lost 53,000 workers. Leisure and hospitality cut 4,000 jobs.

These jobs were lost due to the policies of the Democratic ruled Senate Banking Committee. All of these jobs relate to the Housing Industry. Now you have states and cities buying foreclosures for 20 cents on the dollar, to rehab and resell. To who. Why didn’t those states and cities buy the mortgages and let the citizens stay in their homes. The states and cities are low-balling the banks, creating more losses, which translates into more job losses, more banks failing, THE FDIC FAILING. Read this article in Time Magazine http://www.time.com/time/nation/article/0,8599,1840329-1,00.html

If states and cities have $3.9 billion dollars lined up from the Federal Government to buy and rehab foreclosed homes, why not use that same money to open back up Mortgage Banks that will refinance the homeowners into a affordable mortgage. It seems to me we are being duped in this housing crisis and I want it to stop and for the real culprits to be exposed.
California’s attorney general is reviewing a request by former employees of IndyMac Bancorp Inc to investigate whether a New York senator triggered the bank’s collapse by releasing confidential information. http://www.zimbio.com/Senator+Charles+Schumer+of+New+York/articles/28/Chuck+Schumer+Being+Investigated+IndyMac+Failure

This has been the work of the Senate Banking Committee for the past two years, spread rumors about a bank, have the investors lose confidence, freeze the credit lines, sell the stock, and collapses the bank. The question is why? What’s going on? Is it to insure that the Democrats take the White House too? LISTEN AMERICAN PEOPLE ARE SUFFERING, LOSING THEIR HOMES, ALL BECAUSE THE DEMOCRATS WANTED TO WRECK THE ECONOMY, SO THEY COULD RUN ON THE “I CAN FIX THE ECONOMY PLATFORM”. IT’S CRIMINAL!!!

I am not sure why these executives do not use “Business and Competitive Intelligence” software to understand where they are going rather than driving blind and falling off a cliff? Is that because these executives do not know how to use the technology or once there spend their time playing golf….

i must agree with the previous posters. c’mon. “top level execs?” i hope those nat resources guys in houston weren’t hanging out with the MMA chicks. maybe thats where the biblical reference comes in.

seriously, you base your products on derivatives that nobody understands and sell like a sleazy insurance salesman. when hedge funds and SWF’s won’t even bail you out, you know you’re crap.

now who else on the street is shaking in their boots? (aig we’re talking to you)…

“Where is the apology? I’m mad. I’m furious,” says one ex-Lehman executive… Huh? you and your friends play games with my money, puff yourselves up like you’re oh so smart and even now you still can’t deal with your own responsibility in this? Until folks like these get a clue, we are all going to suffer.

what a joke, why should we the people bail out thier mistakes, smells like enron and feels the same. Some other half baked bank will once again, put her in power so we can bail that one out as well! What when we the people need to bail out? Isn’t that when the goverment tells you or I tuff!! Who is in bed with who? Lets have a tea party on them. Stop paying our taxes take your money out before it is all gone!
You can kiss your retirement good bye. But you will see the bank exec’s long cash-out before now. Opps, I didnt mean to say that, Not.

(If he had been able to hang on this week he would have announced progress on a survival plan.)Are they kidding where was this plan two years ago? Anyone in Fulds position should be aware of his surroundings. Most compaines don’t plan to fail, they fail to plan. But with todays lottery type compensation for senior management perhaps it was better to hang on collecting larcenonus bonuses until the scheme is exhusted.

I feel bad for the kids right out of college and the secretaries…but I have zero sympathy for anyone else there. I remember may days on Wall Street; caught a huge error that saved the firm from a $2.5 mil trade error…got no bonus and was then laid off because I was one of the junior guys. Have fun standing in the back of the line now.

“senior execs — a ton of talent there — ”

That was meant to be sarcastic, right? These are the people who engineered the crap loans and named them “innovative products”. And they were talented enough to bet their retirement funds and children’s future on the result of their innovative decisions. Cute.

Chalk up another disaster for George “Dubya” Hoover. If bad things happen in threes, does that mean we’re done?

The whining of executives from Wall Street will (and should) fall on deaf ears as they disseminate through the media. For every executive, there are thousands of Americans suffering for their abuses. The executives at Lehman have gotten exactly what they deserve.
Perhaps the single mother of two in the story wouldn’t be crying so hard if the executives in these companies paid her like they pay themselves.