This Is So Wrong

James Cayne, Bear Stearns Cos. Board Chair and former CEO, sold his stake in BSC stock (5.7 million shares) on 25 March, after an offer from J.P. Morgan was raised from $2 to $10 and the stock price moved above $10. He netted $61.3 million.

While this is a far cry from the $1 billion the stock was worth two years ago, it is beyond the pale that he is being rewarded with any millions when the public has prevented his firm from going down the tubes ... the result of his poor judgment of risk.

How does this jibe with Sen. John McCain's message to homeowners hit by the industry's self-inflicted meltdown:

[It] is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers.

But we can bail out a CEO so that he can go buy a $26 million home in New York's Plaza Hotel? And he'll probably won't pay income tax on the $63 million because he has a big paper loss. Gack.

US taxpayers have now "invested" $730 billion to rescue the banks from their own (de-regulated) practices. About $30 billion of that was so JPM could rescue BSC. US Economy Guide Kimberly Amadeo believes that this infusion was needed to avoid financial meltdown. See her explanation of the subprime mortgage crisis.