Wild Thain

It is with a heavy heart that I bring you the news that John Thain, the superb CEO who saved Merrill Lynch from going bankrupt, has sadly resigned his new position as Head of Bank of America's Global Banking arm after just 3 weeks.

A Lousy $10m Bucks!

"Goddam it," cried one of Thain's former senior staff at Merrills, Buck Paasser. "He was a good CEO. No, scrub that - he was a great CEO. The best of the best. He saved our company from bankruptcy by palming us off to Bank of America within seconds of the bank going belly up. That takes guts, acumen and sleight of hand, I tell you."

Paasser wept openly. "All he wanted was a lousy $10m bucks of bonus," he whimpered. "What has the world come to when you take over a bank for $19bn and you can't find enough spare change to give the guy who saved the company a little pocket money? Hell, the man is practically desitute - he gave everything to that company and he made what it is today."

Unexpected Losses

I pointed out that there was the minor issue of some large losses at Merrills that might have been 'played down' at the time of the buy out by Bank of America.

"What?" screamed Paasser. "Are you trying to tell me John Thain was dishonest? Get out of here. The man was practically a saint. You can't tell me that someone that has the kind of attention to detail that redecorates his office for $1.22m would cover up excessive losses - no, sir. He should not be blamed for the price of wood, paint and fine art."

"Look, yeah so we had trouble with the calculator and Excel was playing up," continued Paasser. "We couldn't seem to make the numbers work and we kept coming up with a spare minus $15.3bn which we couldn't account for last quarter. So we just rounded the numbers up. Hey, it's not our fault BoA have to go to the Fed and ask for an extra $20bn maybe if they paid the bonus we might have wondered more where that $15bn had gone. Anyways, BoA had already used up $25bn in October so what's another $20bn here and there - as if that's going to really save the bank."

Spare A Thought

I asked Paasser if he thought of John Thain asking his Board for $10m bonus in the light of $15.3bn losses last quarter was a particularly wise or good thing to do and perhaps it had some contribution to his departure.

"Are you joshing me, buddy," screamed Paasser. "Just because the whole Finance system failed a great man does not mean he should be able to go home and feed his family, buy a new car, dig a new pool or buy a small island in the Caribbean. Jeez, where is your humanity? The guy was only asking for $10m - you make him sound like he didn't care. He did - and that was the poor guy's failing. He cared a lot about how the heck he was going to get rich again, particularly now that guy Madoff has got all us Finance guys a bad name."

In the murky world of banking, John Thain was some guy. After selling Merrills to BoA just before breaking point for $19.4bn, the last quarter figures surprised everyone but him at a walloping $15.3bn loss. And he was the man who had the chin to ask for a $10m bonus from his Board for saving Merrills.

Still, I'll lay a bet he'll be back and at it again somewhere soon. Racking up losses seems to be a marque of credibility in the World of Finance.