Add Another CEO Notch to Sub-Prime Crisis

According to a late Monday story from Kate Kelley of The Wall Street Journal,

James Cayne, the chairman and chief executive of Bear Stearns Cos., under fire from shareholders after the Wall Street firm was badly burned by the downturn in the mortgage market, is stepping down as CEO, say people familiar with the matter.

Nothing all that surprising when one considers Cayne's reputation as a hands-off executive who even during the height of the sub-prime crisis remained aloof while Bear Stearn's possible survival had been at stake. According to the Journal, Cayne will remain Chairman. Speculation continues that Alan Schwartz, Bear Stearns' president will take Cayne's place as CEO.

Stay tuned.

For more:

CNBC
Reuters
Portfolio.com
Bloomberg
Forbes
Market Watch
Guardian
Financial Times
CNN Money

New Ways To Avoid the CEO Watch List

Surprise, surprise, Wall Street CEOs have discovered a new tool to save their jobs or at least their reputation. Some of the CEOs who had the potential to be on my CEO Watch List have chosen to pass on bonuses. You did not read this wrong, they chose to pass. Here's a brief list: John Mack, Morgan Stanley and James Cayne, Bear Stearns, more can be expected.

Peter Cohan of BloggingStocks has a slightly different take on why the CEOs decided to forgo a bonus. Here is what he said,

Why are they doing this? Because it's going to make it easier for them to stiff lots of employees who they don't think will be essential to making a profit in 2008 and 2009. Investment banks have less bonus money to go around and they will try hard to pay enough to their top performers to keep them from jumping ship. If they can keep these top performers around, then they will be able to reap the rewards in the future. In the meantime, those no-bonus CEOs will need to make do with the hundreds of millions they've gotten in the last few years.

Whatever the reason, it is definitely a new approach.

For more:

NY Times (Update Dec. 21)
CNN Money (Update Dec. 21)
CNN Money
Investment News
Baynews9.com