Comments on: Millionaire Factory turns corporate dud club http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/ now with extra source Sun, 12 Feb 2012 00:58:05 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Sean http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35170 Sean Sat, 22 Aug 2009 00:15:57 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35170 PeterJimmy, I think you've totally missed the prime causes of the GFC and the problems associated with MQG's habit of overpaying for assets and overleveraging businesses, creating short-term windfall profits and payoffs with longterm unsustainability, and of the ability to charge massive and arbitrary 'service fees' and 'success fees' for setting up dodgy loans and M&As. It's called excessive risk-taking, speculation, gambling, greed and 'wood for the trees' syndrome. What you don't seem to understand is that the $14M executive remuneration has to come from somewhere, the 'service fees' have to come from somewhere -- ultimately being the pockets of people paying road tolls and using other services like airport parking. There's lots of sweeping under the carpet of the inconvenient truth going on here. This is no different in essence from the blind ambition and hubris that lead to the collapse of Centro, ABC Childcare Centres, and the rest, which would probably be better comparison points than HIH. You can't blame the GFC for causing the problem when in fact the unsustainable borrowing activity worked hand in glove with the mythical credit being raised in the international finance markets just prior to a major correction which is still unfolding and has quite a way to go. To be honest, you would be better having the govt own and manage the roads and airports themselves, with selective outsourcing of functions to service provision entities rather than selling these assets off to a speculative private sector lock, stock and barrel. But NSW and Federal Labor and the Macquarie Bank are more or less synonymous these days, it would seem... PeterJimmy, I think you’ve totally missed the prime causes of the GFC and the problems associated with MQG’s habit of overpaying for assets and overleveraging businesses, creating short-term windfall profits and payoffs with longterm unsustainability, and of the ability to charge massive and arbitrary ‘service fees’ and ‘success fees’ for setting up dodgy loans and M&As. It’s called excessive risk-taking, speculation, gambling, greed and ‘wood for the trees’ syndrome. What you don’t seem to understand is that the $14M executive remuneration has to come from somewhere, the ‘service fees’ have to come from somewhere — ultimately being the pockets of people paying road tolls and using other services like airport parking. There’s lots of sweeping under the carpet of the inconvenient truth going on here. This is no different in essence from the blind ambition and hubris that lead to the collapse of Centro, ABC Childcare Centres, and the rest, which would probably be better comparison points than HIH. You can’t blame the GFC for causing the problem when in fact the unsustainable borrowing activity worked hand in glove with the mythical credit being raised in the international finance markets just prior to a major correction which is still unfolding and has quite a way to go. To be honest, you would be better having the govt own and manage the roads and airports themselves, with selective outsourcing of functions to service provision entities rather than selling these assets off to a speculative private sector lock, stock and barrel. But NSW and Federal Labor and the Macquarie Bank are more or less synonymous these days, it would seem…

]]> By: peterjimmy http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35103 peterjimmy Fri, 21 Aug 2009 05:56:46 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35103 Rena, the issue of executive salaries is really just a big furphy for politicians to beat their chests and shareholders to let off a bit of steam. Of course the Macquarie MD isn't worth $14 million pa but the reason he and many others get such exorbitant amounts is simply because someone agreed to pay it to them. The fault lies with the Boards that agreed to these packages, not the people who gratefully accept the money. On the other hand, the Boards are advised by consultants on what it'll cost to get the high quality people they want so, sadly, in the end it's this nasty free market of ours at work. Rena, the issue of executive salaries is really just a big furphy for politicians to beat their chests and shareholders to let off a bit of steam. Of course the Macquarie MD isn’t worth $14 million pa but the reason he and many others get such exorbitant amounts is simply because someone agreed to pay it to them.
The fault lies with the Boards that agreed to these packages, not the people who gratefully accept the money. On the other hand, the Boards are advised by consultants on what it’ll cost to get the high quality people they want so, sadly, in the end it’s this nasty free market of ours at work.

]]> By: Rena Zurawel http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35098 Rena Zurawel Fri, 21 Aug 2009 05:36:03 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35098 State Bank SA, HIH, and now Macquarie - all those lovely bank 'products' contributed to the world crisis. Shall we ever learn? In the world of strict licensing, monitoring, registration and compliance system - how come that no such rules apply do the banks and their 'products'?. Perhaps it is not about crooks and gangsters. So where is the culprit? Is there a chance to avoid disasters in the future? Or is it a dead -end-capitalism? Peter, can you explain why Macquarie bosses had such hefty salaries? (14mln a year). Was it 'performance-based'? State Bank SA, HIH, and now Macquarie - all those lovely bank ‘products’ contributed to the world crisis. Shall we ever learn?
In the world of strict licensing, monitoring, registration and compliance system - how come that no such rules apply do the banks and their ‘products’?.
Perhaps it is not about crooks and gangsters. So where is the culprit? Is there a chance to avoid disasters in the future? Or is it a dead -end-capitalism?
Peter, can you explain why Macquarie bosses had such hefty salaries? (14mln a year). Was it ‘performance-based’?

]]> By: peterjimmy http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35080 peterjimmy Fri, 21 Aug 2009 04:24:57 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35080 I know that there's plenty of scope to criticise Macquarie but any comparison with HIH is just mischievous. We're still going through a "Global Financial Crisis", which has wiped out the likes of Lehman Brothers, and Macquarie and it's satellites have been hit harder than most. Sure, asset values have fallen and it's way of setting up these funds might now be outdated but they're not crooks who riped off poor shareholders and policy holders as Adler and Williams did. Glenn Dyer makes more sense when he's writing about Kyle and Jackie O. I know that there’s plenty of scope to criticise Macquarie but any comparison with HIH is just mischievous. We’re still going through a “Global Financial Crisis”, which has wiped out the likes of Lehman Brothers, and Macquarie and it’s satellites have been hit harder than most. Sure, asset values have fallen and it’s way of setting up these funds might now be outdated but they’re not crooks who riped off poor shareholders and policy holders as Adler and Williams did.
Glenn Dyer makes more sense when he’s writing about Kyle and Jackie O.

]]> By: jose carreras http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35073 jose carreras Fri, 21 Aug 2009 04:09:18 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35073 What is really frightening is that even though Macquarie are completely screwing their investors on deals such as the Airport, there will probably still be enough morons around in the future to buy into their future schemes, when you would think that no investor or bank would ever touch them again with a 40 foot pole. What is really frightening is that even though Macquarie are completely screwing their investors on deals such as the Airport, there will probably still be enough morons around in the future to buy into their future schemes, when you would think that no investor or bank would ever touch them again with a 40 foot pole.

]]> By: jchercelf http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35056 jchercelf Fri, 21 Aug 2009 03:42:29 +0000 http://www.crikey.com.au/2009/08/21/millionaire-factory-turns-corporate-dud-club/#comment-35056 Macquarie's failure may have something to do with the Carr factor - after all he was'the premier for opening National Parks' and left NSW in an impossible mess - poor infrastructure - transport - hospitals and everything else. Now he is paid to do something or other for Macquarie Bank. Good luck you millionaires, Joan Croll Macquarie’s failure may have something to do with the Carr factor - after all he was’the premier for opening National Parks’ and left NSW in an impossible mess - poor infrastructure - transport - hospitals and everything else. Now he is paid to do something or other for Macquarie Bank.

Good luck you millionaires,

Joan Croll

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