How to make a small Fortune

Some people say it's by starting with a big fortune and then buying a football club or string of racehorses.

However, the folks connected with Bear Stearns must be feeling it. It puts the performance of my FTSE ISA in a good light. :-s

I've been reading some articles in The Economist which make scary reading.

• This from 5th Nov 07:
• "Some think that Jimmy Cayne, Bear Stearns’s boss—fingered for playing golf and bridge while two of his bank’s hedge funds imploded—will be the next to pack his briefcase."
  
• This from 10th Jan 08 (when :
• "Mr Cayne had been under huge pressure to go, thanks to $1.9 billion of mortgage write-downs—leading to the bank's first-ever quarterly loss—and accusations that he had been more interested in improving his own performance at bridge and golf than shoring up his bank's standing in the markets.
• He will remain as non-executive chairman, continuing to command an eight-figure salary, after Alan Schwartz, a trusted lieutenant, takes over as chief executive. Mr Cayne's durability prompted one observer to dub him the “Harry Houdini of the boardroom”."
• This from 19th Mar 08:
• Bear's executives have lost billions.
  
• At $2 a share, the 5% stake held by Jimmy Cayne, the chairman and former chief executive, worth $1.2 billion at the shares' peak last year, is now valued at $11m (less than half of what Mr Cayne recently paid—mortgage-free, naturally—for an apartment in the Plaza Hotel).

For other investors (large and small), the damage is phenomenal (same article):

• "Lowlier workers have been hit even harder. Bear encouraged them to buy shares after it went public in 1985. Their purchases have pushed employees' combined stakes to one-third. Some have lost their main nest eggs, others the money to put children through college. Worse, half or more of the 14,000 staff are expected to lose their jobs. Counsellors are on hand. Comparisons are being made with Enron, where the employees lost $2 billion in pensions.

  The shock is fast turning to anger: that bosses left it so late to seek capital; that employees were prevented from selling shares because an earnings announcement was coming; and, above all, that JPMorgan Chase has probably got a bargain.

  Allied with big shareholders such as Joe Lewis, a Bahamas-based billionaire who spent $1 billion on Bear stock last year, some employees like to think they can muster a majority against the deal when the vote is held in six weeks. On March 18th Bear's shares closed at $6.51, reflecting the chance of a higher offer."

That's a shocking turn-around.

Jimmy Cayne will presumably get a pay-off in the tens of millions of dollars. As our friends in the US say - go figure.