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Chuck Prince

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Wall Street’s Golden Idols All Have Feet of Clay

FINANCE • The struggle to find a successor at Merrill and Citi demonstrates another big flaw in the current culture of Wall Street: Do-or-die standards, and growing demands on public executives, have left firms with no succession plan and few capable of stepping in to take over. Both firms have been forced to turn outside for help: Laurence Fink, the CEO of BlackRock, has been approached about O'Neal's old job, while Robert Willumstad and John Thain are in the lead to take Prince's place. [WSJ] • Why did Chuck Prince and Stan O'Neal fail? They took Gordon Gecko's favorite maxim—"I create nothing, I own"—a little too seriously, and forgot the other part of banking is to sell, sell, sell. [NYT] • Andrew Ross Sorkin dons his Miss Manners cap to explain the rules of corporate courting—and why Stan O'Neal's worrywart parents, the Merrill Lynch board, were only looking for an excuse when they grounded him for asking Wachovia to "merge." [NYT]

Goodbye, Charlie

We've said it before and we'll say it again: Chuck Prince has been on our—and everyone's—about-to-get-axed list for about three years. Look, there he is right there, in this week's magazine, with a little axe hovering over him! It's been especially bad the past month or so, after Citigroup announced a $6.5 billion write-down, and everyone started openly talking about how Prince sucked and should leave, even though Rick Rubin and Prince Al-Waleed bin Talal defended him. It sort of reminded us of when Lacey was on Rock of Love: Even when everyone in the house was hating Prince, when it seemed like there was just no way he was going to win, the board still had the hots for that crazy bitch and refused to kick him off the show. Of course, as with Lacey and Rock of Love, all things come to pass, and this past Saturday, the Citigroup tour ended for Prince. But we have to ask, why now, as opposed to back then? Did Stan O'Neal inspire Prince? Are the fourth quarter numbers just too heinous for him to stick around? Was he fed up, as the Wall Street Journal this morning suggests, with rassling with the mammoth bureaucracy that is Citigroup? Or: Was Prince merely afraid that if he stayed on a moment longer someone at the Journal would uncover his stash? In any case: Now that the floodgates have been opened, we're looking at you, Cayne. Citigroup Statement on CEO Prince [WSJ] Related:Big Swinging Ax

Did Aaron Charney Only Get 100K From Sullivan?

LAW • Will Aaron Charney ever have to work again? More than likely — he may not have gotten more than $100,000 in his sexual-harassment settlement with Sullivan & Cromwell. [PrawfsBlawg via Above the Law] • Should law schools be more like business schools? One law prof thinks so, and he looks a little like Justin Timberlake, so he must be right. [Law Blog/WSJ] • Do Cravath's two rounds of bonuses signal Big Law strength and more money for associates, or is the firm just hedging so they aren't locked in to paying the same amount next year? [NYT]

Things Get Hairy on Wall Street

With the sub-prime debacle, the barons of Wall Street have learned a lesson about risk. But there's a chancy new fad on the horizon they might not be able to resist. Aaron Perlut, the co-founder of the American Mustache Institute, issued a warning in the morning's Wall Street Journal:
"You're definitely out on a limb when you grow a mustache, especially a flamboyant one, and if you do, you always run the risk that people will think you're going too far."
That's right, folks! Tomorrow begins Movember, a monthlong Australian contest which encourages businessmen grow mustaches, or "mos," in order to raise funds for prostate cancer. This is the first year that the contest has come to the U.S., but it seems that New York's finance guys might be a little too uptight to, ahem, "sport a mo." The Journal points out that none of the chief executive officers at the top-ten Fortune 500 companies have mustaches — although we imagined what some of them would look like if they did, above — "and for young professionals seeking to follow in their footsteps, growing one may seem like a step in the wrong direction." Take the experience of Christopher Doyle, a 26-year-old audit assistant at Deloitte & Touche, who was given a "gentle reminder" to shave after only two days of work. Well, that's Wall Street for you. Clean-cut at the office, drag and nipple clamps at home. Growing Facial Hair for Charity [WSJ] Movember [Official site]

Stan O'Neal: It's the Final Countdown!

What did you do this weekend? Oh, yeah? Well, Merrill Lynch CEO Stan O'Neal, whom we put on Deathwatch last week, spent the weekend negotiating his $160 million severance package. Nice payout, considering he, you know, was responsible for the biggest loss in the bank's history. But can we just say it's kind of amazing how fast this all happened? It was only a week ago that O'Neal announced his multi-billion-dollar write-off, and this morning, the Wall Street Journal reports he's expected to resign this afternoon. Whereas we and the rest of the universe have had Citigroup's Chuck Prince Deathwatch for like three years and still the dude is cozy in his Lexington Avenue throne. So, why has O'Neal gone down like a ton of bricks, while Prince is living large? Management Today suggests it might be because O'Neal is black. But we're not so sure. (Also, not so comfortable with that headline, guys, considering O'Neal is actually a descendent of slaves.) But more likely it is just that he: • Reported an $8 billion loss in the third quarter, which makes Chuck seem like he was being frugal for losing only $6 billion. •Was super-competitive with Goldman Sachs, to the point where his staff avoided him during Goldman earnings because he was not nice. • LOST $8 BILLION • Was maybe talking to Wachovia about a merger behind the back of his board. • Lost $8-fucking-billion We think that about sums it up. O'Neal Out As Merrill Reels From Loss [WSJ] O'Neal Gets Merrill Lynched [Management Today] Earlier: The Stan O'Neal Deathwatch

Bank of America's Friends: One Is Silver and the Other's Gold

Eugene Taylor
Embattled CEOs like Citigroup's Chuck Prince, whose departure has been rumored and longed for since he announced profits were down by 60 percent last month, and Merrill Lynch's Stan O'Neal, who the other day announced they'd be taking $8.4 billion — that bears repeating: $8.4 billion — in write-downs, ought to take a cue from Bank of America's Kenneth Lewis, who after reporting a 32 percent drop in third-quarter results decided to do like a smart despot and start executing his cronies before the people start marching him to the gallows. Last night, Lewis announced a restructuring of the bank, which includes the "early retirement" of B of A head of investment banking R. Eugene Taylor, above, a trader for some 38 years and a longtime tennis buddy of the CEO's. He'll be replaced by Brian Moynihan, a bright young thing who will move from Boston to New York to take over the division. But Moynihan has never run a capital markets unit before now, and honestly, with the Red Sox in the World Series, how popular will he be in New York? BofA's Wall Street Retreat [WSJ] Related: The Hanger-on [NYM]

‘Times’ Laughs in Morgan Stanley's Face (Well, Back)

MEDIA • Marcus Brauchli remains top editor at the Journal, but there's a growing sense of inevitability that Robert Thomson, Sunday Times of London editor and Murdoch "old boy," will challenge him for the position. (Related question: Does Murdoch have any "boys" who are not "old"?) [NYO] • The Times' third-quarter earnings almost doubled analysts' expectations, giving the paper a chance to gloat about the big hit Morgan Stanley took a week ago by selling its stake in the company. [NYT, DealBook/NYT] • Rick Reilly, previously the highest-paid writer in the history of Time Inc., will get $2 million a year for five years at ESPN. Who knew wussifying sports would pay so well? [NYP]

Who's the Real Heir to Sandy Weill?

FINANCE • Citigroup's Chuck Prince and Chase's Jamie Dimon are battling it out to see who's the real heir to Sandy Weill. With Citi crashing and Chase eking out a gain despite the credit crunch, it looks like Dimon, long prodigal, may be the true son. [Deal Journal/WSJ] • Treasury Secretary Henry Paulson warned that we may see as many as one million home foreclosures before the end of the year. [NYT] • Want to be a hedger and a do-gooder, work a trading floor and enjoy the peace of mind of a nonprofit? Join the World Bank like former Goldman exec Robert Zoellick, and you can manage $55 billion in assets. [NYT]

Air America Host Randi Rhodes Mugged?

MEDIA • Air America talk-show host Randi Rhodes was assaulted on Park Avenue last night while walking her dog? [Gawker] • Jack Shafer investigates the billionaires behind ProPublica, the newly established New York–based investigative-journalism nonprofit led by former Journal managing editor Paul Steiger. Surprise, they're big Democratic donors. [Slate] • Howard Kurtz took the nonstop promotion of his gossipy new book to its logical conclusion, interviewing himself on his own CNN show. [HuffPo]

Citibank Shake-up Shakes Out for Vikram Pandit

Guess we know why Citigroup's Vikram Pandit felt okay about buying that fancy $17.6 million apartment in the Beresford! Dude just got a promotion. Last night, embattled CEO Chuck Prince announced he was consolidating its investment-banking and alternative-investment groups and appointing Pandit as the king of both of them. Though Pandit has a reputation for being "calm," "selfless," and "not prone to ruthless acts," as the Times puts it, the guys who were slated to be underneath him are none too pleased. Already two executives, Thomas Maheras and Randy Barker, have decided to leave the bank. Meanwhile, some people are wondering if Prince's appointment of Pandit means that he's going to resign? Deutsche Bank's Mike Mayo thinks he should. But former Secretary of the Treasury Robert E. Rubin bet the Times $100 that Prince will have his job next year. And you know how much $100 is worth on Wall Street these days. Big Shake-Up As CitiGroup Combines Two Units [NYT] Citibank Cut to Sell By Deutsche Bank on Governance [Bloomberg]

Two Princes

Two Princes
"The patience of shareholders is getting thin … I'm patient, but enough is enough," Saudi prince Alwaleed bin Talal, Citigroup's largest single and occasionally, fabulously critical shareholder said back in 2006, when the bank reported lower than expected earnings. It came as a surprise today, then, after CEO Chuck Prince's announcement that he expected profits this quarter to have fallen by 60 percent and the bank's generally poor performance has had industry-watchers and analysts calling for his head for quite some time now, that Alwaleed did not take this opportunity to lay his smackdown on the CEO but held his arms open for a hug. "I'm backing the management of Citi and Chuck Prince. They have my full support," he told the Journal this morning, referring to the loss as a "hiccup". Which totally reminds us of how whenever Lindsay Lohan has to go rehab, her publicist says it's "exhaustion."

Topshop Signs a Lease in NYC?

FASHION • Breaking rumor alert: After months of hinting, Topshop has possibly, maybe signed a New York lease. Anglophiles and Kate Moss–ophiles, rejoice! [Fashionista] • First he’s out as the designer of Dior Homme. Now, Hedi Slimane’s been replaced by none other than BFF Karl Lagerfeld as the photographer of the ad campaigns. Oh, cruel fashion world! [WWD] • Giorgio Armani’s raking in the dough. The designer sold back a 5 percent stake in his company to Giorgio Armani SpA for about $110 million. [British Vogue]

All Is Not Well in Redstone Land

MEDIASumner Redstone, the octogenarian CEO of CBS and Viacom, is trying to play all lovey-dovey with his spurned daughter Shari, but the succession to the $50 billion empire is nowhere near resolved. [LAT] • With more than a 1,000 job cuts at Time Inc. behind her, Ann Moore, the CEO who rose from the back room to the boardroom, thinks there's still plenty of fat to cut — she asked some McKinsey consultants to keep sharpening their knives. [NYP] • ABC News has done gangbusters over the last year, leading nightly news and finally catching up in the morning, so why did their Disney overlords decide to shuffle management at the top? [NYP]

The Beef of the Century: Jim Cramer Disses Chuck Prince

Jim Cramer and Chuck Prince
The war of words between 50 Cent and Kanye West is yesterday's news — but it is ON between Jim Cramer and Citigroup CEO Chuck Prince, whom Cramer thinks should be fired, like, now. Under Prince's reign, "Citigroup has been at the cutting edge of everything that is bad," Cramer told Farnoosh Torabi of The Street today.