Like many others, I read with interest last week's report that Morgan Stanley had offered severance pay of roughly $113 million to its now-deposed head Philip Purcell. Purcell, as was widely reported, was finally forced out of his job after driving down the firm's stock price, badly harming morale, and leading numerous other executives to quit and go elsewhere. In return for this performance, Morgan Stanley's board gave him what may be the mother of all golden handshakes; and then, presumably to show they weren't playing favorites, gave a $32 million severance package to a Purcell appointee who had held his job for only three months.
This set me to thinking, especially during those hours when I sit at my desk paying my bills and trying to balance my checkbook. With my ignorance of investment banking and my vast inexperience as a corporate manager, I am quite certain that, if appointed to run Morgan Stanley (or any comparable firm), I too could produce a decline in the firm's stock value. With some effort and given a little time, I could also cause conflict among other managers and probably induce some of them to quit in disgust. And here's the great part: I would be willing to do this for a song. $10 million. Even $5 million for a year or two. I also have some friends who would join me in driving the firm into the ground for $1 million a year. Surely, this is an offer they can't refuse. . . .