I can’t say I agree with Felix Salmon and John Carney that the most interesting anecdote in the great New York Times piece about the feud between Alan Greenberg and Jimmy Cayne at Bear Stearns was the following:
The final straw for Mr Cayne was Mr Greenberg’s decision to charge Mr Cayne a commission of $77,000 for the sale of his six million shares of Bear stock, a rate far above the maximum $2,500 commission that employees pay for a single trade. Since Mr Cayne was not an employee anymore, he did not deserve such a rate, Mr Greenberg said. “If he doesn’t like it, he should do his future business elsewhere,” he added.
Actually, I prefer this one:
Mr Greenberg says he did contemplate leaving, in part because his views were not being heard and for another reason as well. “I was depressed. My dog was sick,” he said. “He had not been performing well in dog shows.”
I think that, while the first story speaks well to the pettiness that can erupt between two old friends and colleagues when an institution disintegrates, the second says something about the oddity of Bear’s executive culture.
The lesson, I think, is that both men were too old and out of touch to be in charge of their institution, particularly in a time of turmoil.
Mr Cayne, 74, was chairman, but was seriously ill last summer and spent a lot of time out of the office at bridge tournaments as Bear crumbled. Having been around for so long – and been originally hired by Mr Greenberg when he was earning his living playing cards – he lost touch with his responsibilities.
Meanwhile, Mr Greenberg, who is 80, was revered for his past leadership of Bear and for his witty, irreverent manner. That is fine, but he was allowed to remain chairman of the risk and executive committees, which was ridiculous.
I wrote in a column that Bear’s leadership was “old, self-satisfied and inbred”and this article provides no reason to change that view. I imagine a lot of employees must wish a plague on both Mr Greenberg’s and Mr Cayne’s houses.
