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Enriching few at the expense of many


shalab
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Interesting article in NY Times, an action we have seen at BH and few other places recently.

 

http://www.nytimes.com/2011/04/10/business/10gret.html?_r=1&ref=business

 

 

Whatever is your sentiment, it is hard to argue with the closing paragraphs of the article:

 

 

“There has been a massive wealth transfer from middle-class America’s retirement accounts to the bank accounts of the privileged few. The social consequences of this wealth transfer bear scrutiny.”

 

 

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So the US president, Canadian PM, senators, representatives etc. all make less than 1 million with no bonus.  How to explain, how to explain.

 

Shareholders need to be more discerning.

 

I was looking at the proxies of three companies recently:

 

LQW-T :  Declined to buy because the CEO and CFO would have ate all the earnings with bonuses

 

NBD - T:  Forest Products - CEO and company collected large bonuses in the last two years and large paychecks while they consolidated the shares 10:1 and shrunk the share price by 10 x.  Blamed sales on the economy.  Justified their pay, somehow?  Note to BAM holders.  This is majority owned by Brookfield so you know where they are coming from.

 

MTL - T: Mullen Group - CEO/minority owner Murray Mullen took a $1 pay check in 2010 for poor performance and no bonus. 

 

I own shares in Mullen, 5-6%, and a residual position in an RSP in NBD.

 

Wont be buying LQW and likely not NBD unless I see a big lumber business expansion.

 

I am betting the CEO of JNJ has not taken a pay cut  for crappy performance either.

 

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