Bernie's Bad Idea
from the would-you-loan-this-man-money? dept
A very interesting look at how WorldCom bailed out their CEO, Bernie Ebbers to the tune of nearly half a billion dollars. It seems that Ebbers gambled on his own stock, buying a ton of it on margin when it was at it's highest. After the stock collapsed, the margin call came, and WorldCom decided that it was "in the shareholders' best interests" not to have a CEO who was personally bankrupt. So, they "lent" him $430 million at 2.5% annual interest (which is, of course, significantly lower than what anyone could get elsewhere). In other words, he gambled big, and lost big - but it didn't matter because he just dipped into his troubled companies cash coffers to prop himself up. Seems like quite a deal.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
