There's a new standard on Wall Street: You can lose $8 billion and still come out a winner.
Somewhere, Gordon Gekko is smiling.
That's the lesson from investment house Merrill Lynch. It recently took a near $8-billion charge, a bundle that's backed by crummy securities laced with troubled sub prime mortgages.
Making matters worse: Merrill's board took its sweet time dumping Stan O'Neal, the CEO responsible for this investment debacle. Apparently, the gargantuan loss caught them by surprise, as did O'Neal's last-ditch scramble to rescue the firm by trying to sell it to another financial giant.
Even after the board decided to act, it didn't get too rough with O'Neal, who made $48 million last year.
In fact, it helped him out by going along with the charade of letting him "resign". That "resignation" enabled the former CEO to go packing with an extra $90 million, giving him a total farewell package worth nearly $160 million.
That's $160 million gain on an $8 billion loss.
See how it works?
Most people who make mistakes, even honest missteps worth much less, are summarily fired from their jobs. And when they're canned, employers say it's "for cause" or "gross dereliction of duty" and then often move to strip them of health or pension benefits and bonuses.
But there's different rules for the capitalist tools on Wall Street, especially the top brass at the investment houses.
They get to lose $8 billion and walk away rich.
In the 1987 movie Wall Street, Gordon Gekko said that "greed is good".
And these days, the greedy are doing a lot of good for themselves.