Friday, May 22, 2009

No Golden Parachute for Tricky Ricky


I am not using this as a debate over "to bailout, or not to bailout", I just want to shed some light on the rumored 20 million dollar severance package that Rick Wagoner is reportedly getting.

That 20 million is not what it's cracked up to be. When the Obama administration asked Rick to step down there were numerous reports of a 20 million dollar severance payout. News stories such as this one from ABC, conitnued to spread the bad press about the auto industry. In reality the 20 million was not so real.....

From the Mariam Webster Online dictionary, the defintion of a "Golden Parachute" is: a generous severance agreement for a corporate executive in the event of a sudden dismissal (as because of a merger)

This is not what Mr. Wagoner got.
Dave Schmidt, an executive compensation analyst with James F. Reda and Associates, says that less than $1 million of Wagoner's total $20.2 million pension package appears to be guaranteed if GM goes bankrupt.

This is a true statement. 19.2 million of the reported 20.2 million is part of an annuity scheduled to pay out 4.5 million a year for five years. If GM goes bankrupt this money is unsecured and Rick would lose all of it. If he manages to get out the first 4.5 million to pay his bills, he would be forced to give it back! Damn!!!

Severance package is not looking so good now is it?

That leaves our man Rick with only $980,000.00. That sounds like a lot to you and I, but that's nothing for someone who has been earning a salary btween 1 and 2.2 million per year for the last 8 years. That's like you trying to retire on $80,000.00.

It gets worse: that $980,000 isn't payable in one lump sum. He has to withdraw that annually, payable in installments of $68,900. Good luck paying for the private jet on $70K per year.

I'm sure Rick will get another 7 figure job, but for now he can collect unmployment like the other 13% of Michigan, which happens to be about $380/ week........and you have to pay taxes on that.

-MJL



Sunday, May 17, 2009

Love him or hate him...he's Trump

When working toward riches who better to learn from then the wealthy. This is why I read Donald Trump’s books. In the past I thought Trump was just a "kiss ass" because he's always complimenting those people he works with. Well, I stand corrected.

In his book, Think Big and Kick Ass (it was only $4.99 at Borders – Hard Cover), The Don tells it like it is. He talks candidly about his beefs... with high profile leaders of industry and his mind state when dealing with his issues. When he talks about Kicking Ass he's serious. There is a Chapter entitled REVENGE. He tells you that when somebody messes with you, you get them back in spades. As part of that Chapter, he details his feud with Rosie O’Donnell. I didn't realize how bad it had gotten so I pulled up a Youtube clip….it was bad.
Enjoy.





Sunday, May 10, 2009

Fortune Magazine - In Bad Taste

As a blogger on financial issues and how they affect our lifestyles, I subscribe to several related publications. One of them happens to be Fortune. I think Fortune magazine did a great job back in their February issue with a feature article titled The New Jobless. It really began to put faces and names with the people being laid off and how drastically their lives have been impacted. They profiled young, old, white collar, blue collar, men and women, illustrating how no demographic is secure during times like this.

As we know things have gotten worse since February, so Fortune decides to do a follow up issue and give tips on getting a Job in a difficult economy in a piece entitled “How to Get a Job”. When the issue arrived, the cover looked a little light hearted which put me off just a little. Then as I began to read the article and look at the associated pictures I was terribly annoyed with the photos of people clowning around, making comical gestures. All I could think was, “This sh@#t ain’t funny”. I assume that....the Fortune editors were attempting to add a little comic relief to a stressful situation but sometime it’s not necessary. That’s like trying to tell a Knock, Knock joke at a funeral to lighten the mood. Sometime a funeral just needs to be a funeral.

While I thought I was being overly sensitive, at least one other reader agreed. Per a letter written to Fortune in the annual Fortune 500 issues:

Considering the graviy of the Great Recession and the painful toll of job losses, I was disappointed by the flippant tone of “How to Get a Job”. The staged photos and goofy props had all the subtlety and with of a Cialis ad….
-Edward Mackin
Willow Grove, Pa

I couldn’t have said it better myself.

Fortune, I still love you but sometimes even the ones we love Piss us Off.

-MJL
HERE ARE SOME OF THE PHOTOS - CLICK HERE TO READ THE FULL FORTUNE ARTICLE.