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Dick Fuld: Scapegoat or villain?

Nearly a year after the collapse of Lehman Brothers, a failure that triggered the global economic crisis, the much-lambasted chief executive Richard Fuld seemed burdened — but not crushed — by the pressure of the upcoming annivesary.

“You know what, the anniversary’s coming up,” he told Reuters. “I’ve been pummeled, I’ve been dumped on, and it’s all going to happen again. I can handle it. You know what, let them line up.”

Fuld, a nearly 40-year veteran of the company, took Lehman’s reins in 1994 at one of its darkest hours and rebuilt it into the fourth-largest U.S. investment bank, a Wall Street powerhouse whose massively profitable mortgage banking machine inspired rivals’ envy.

But after filing the biggest bankruptcy in U.S. history, Fuld was vilified and humiliated before a Congressional panel last October and named in nearly 40 different legal actions.

Opinions are still divided over his role in the disaster, but he doesn’t see the point of speaking out: “Nobody wants to hear it. The facts are out there. Nobody wants to hear it, especially not from me.”

Is he the scapegoat of a massive systemic failure on Wall Street, or does he deserve to be a central villain in the collapse?

Bailout bonuses: Does the public have a right to know?

Is it anybody’s business how much money you make?

When it comes to Wall Street and the meltdown that whacked financial markets and emptied investors’ pockets, the normal rules of etiquette don’t seem to apply.

Wall Street salaries seem to be everybody’s business lately. Nevertheless, the Obama administration’s pay czar may try to keep a large portion of the compensation plans he is reviewing under wraps.

It’s Kenneth Feinberg‘s job to review salaries at the biggest corporate recipients of government bailout funds.

How much of his report will become public is the multimillion dollar question.

Privacy laws and fears that highly compensated executives will become targets for an angry public argue for limiting disclosure.

from Global Investing:

Why are analysts so wrong?

Is there something faulty about the way Wall Street analysts look at the companies they cover?  Once again, with the latest quarterly earnings season about to end, the analysts have been wrong. This time, they have been way off the board wrong.

With 480 of the Standard & Poor's index of 500 leading companies having reported, Thomson Reuters research has found that some 73 percent came in better than expected. Only 9 percent of consensus projections were right and 19 percent came in worse than expected.

To a certain extent, this is not suprising. The consensus heading into the latest quarter was made gloomy by the state of the world economy and a lot of stock market losses over the past couple of years. You can be over-pessimistic just as easily as you can be over-optimistic.

But the longer-term track record for analysts is not that much better than the latest offerings. Over the past eight quarters, 63 percent of companies beat estimates, 11 percent matched and 26 percent missed estimates.

So, two questions. Why are they wrong? And if they are so wrong, should anyone pay attention to them?

Jobs: Bad news or good sign?

If you’re one of the 539,000 people who lost their job last month, do you have reason to be hopeful today? The stock market seems to think so. And many of those who work in the financial sector say the April jobless report, which included an unemployment rate at a quarter-century high around 9 percent, indicates the economy is near bottom. One analyst said, “May looks much more favorable”; said another: “You can make the case that the panic layoffs that we saw at the turn of the year are starting to ease.”

Not everyone was optimistic. “The big question is has the peak in job losses hit? I am somewhat skeptical that we have seen the absolute worst of it, but you can’t rule that out,” said Jay Mueller, a senior portfolio manager at Wells Capital Management.

What do you think? When it comes to job losses, is the worst behind us?

Feeling squeezed?

In the past year, consumers have been battered by the housing market downturn, surging food and fuel costs, a credit crunch, and a weakening job market.

On Monday, Wall Street had its worst day since markets reopened after the Sept. 11 attacks in 2001, as Lehman Brothers filed for bankruptcy

The U.S. Federal Reserve stepped in to rescue insurance giant American International Group from bankruptcy with an $85 billion loan on Tuesday, the latest in a series of bailouts and loans for the financial and housing sectors.

And instead of quelling concerns, the AIG rescue seemed to have ignited fears that more bad news is to come.

How have you been affected by this week’s upheaval on Wall Street? Were you a victim of the Lehman bankruptcy, or has your employer been forced to downsize? How has it affected your bottom line – savings, investments, 401k?

Join the discussion on how the crunch is affecting you.