Reputations get shredded fast in a financial crisis, but the speed of John Thain’s descent from hero to zero is extraordinarily rapid.
In mid-October, he seemed like the smartest guy in the pack, delivering Merrill Lynch into the hands of Bank of America for $50bn during the weekend that Lehman collapsed and obtaining a premium for Merrill shareholders amid the chaos.
Contrasts were drawn between Mr Thain’s pragmatism and the obstinacy of Dick Fuld at Lehman Brothers, who held out for too high a price from investors willing to inject capital into his bank and suffered the ignominy of its collapse.
Since then, it has been all down hill for Mr Thain, culminating in him being ejected from Bank of America today, amid revelations about his expensive refurbishment of his office suite by a designer hired by Barack Obama for the White House.
Symbolism matters, and Mr Thain’s initial attempt to gain a $10m bonus for 2008, as well as details of his $87,000 office rug, have turned him into a symbol of Wall Street excess and the tone-deaf unwillingness of bankers to realise the world has changed.
The whole affair is more surprising because, in my dealings with him at Goldman Sachs and the New York Stock Exchange, I have always found Mr Thain to be unusually low-key, modest and amiable for a Wall Street executive.
In a way, beyond even Merrill’s extreme losses in December that caused outrage at Bank of America, the most shocking detail is the FT story this morning that Mr Thain brought forward the payment date for 2008 Merrill bonuses to December.
That act has a ring of fiddling while Rome burned, particularly in view of the Roman theme of his office decorations. It will crystallise the growing public anger at public money being used to bail out institutions that simultaneously pay out billions in bonuses.
