The Best and Worst Executive Awards of 2008

Your votes are in, you have chosen the Best and Worst Executives of 2008, the most God-awful year this side of the Great Depression, a year which saw $13 tn, the equivalent of the annual GDP of the US, wiped out of investors' net worth.

A year in which both home and stock values read like an EKG printout for a heart attack patient.

Before I report to you who won, I must say this--your comments, your thoughts, what you write to me are the main reason why I keep reporting to you. I can't tell you how much I enjoy reading what you say. Hysterical, brilliant, sharp, I am impressed daily with your insights. Please keep it coming.

Because your feedback is very much needed now.

As the Federal Reserve is now the world's biggest junk investor, having taken onto its books the ungodly progeny of Wall Street, its worst assets nurtured by Bear Stearns, AIG and Citigroup, as Wall Street as we knew it has vanished, as December saw the world's worst investment scam, the Madoff scandal, neatly bookend a year begun by the bellyflop of Bear Stearns.

As Congress and market regulators continue to take to the airwaves time and again, as they did throughout 2008, to reassure us they were watching out for investors' best interests.

As the financials and the automotive companies' balance sheets remain as transparent and flexible as a bucket of molasses left outside a kitchen in Yakutsk, Siberia.

Your Vote for Best Executive

Winner: Sheila Bair, the straight-shooting chairman of the Federal Deposit Insurance Corp., who rang the fire-engine red alarms in 2007 that trouble was coming with subprime mortgages, who fought to raise the cap on insured bank deposits to $250,000, among other moves.

Runner-up: Alan Mulally, the former Boeing executive now battling to save Ford Motor, who is restructuring Ford to stanch its colossal losses, and who has made aggressive moves to rightsize Ford, no sacred cows left untouched, including the sale of Jaguar and Land Rover. Mulally has also agreed to cut his pay to $1 a year if Ford gets government loans.

No votes here for Federal Reserve chairman Ben Bernanke, whose fast action may have saved the banking system-or whose tenure may be judged by hyperinflation, as a massive Treasury bubble now balloons.

Your Vote for Worst Executive

Winner: Bernie Madoff, the alleged Ponzi scamster, who told law enforcement he may have ripped off $50 bn from investors, who allegedly scammed even Holocaust survivor and Nobel Laureate Elie Wiesel, whose fraud has decimated portfolios around the globe, and whose pathologically crooked behavior exposed a corrupt feeder fund system where fund managers shockingly gouged investors with fees despite the fact that they put an astounding 95% of their assets with just one fund, Madoff's fund-in essence charging for doing absolutely nothing.

Runner Up: The entire US Congress, a body of elected officials who prove time and again that "it is not necessary to understand things in order to argue about them," (to quote Pierre Caron de Beaumarchais, author of Le Barbier de Saville--I just gave myself a nosebleed).

Followed closely by GM's Richard Wagoner, now overseeing an automaker whose liabilities exceed its assets by $59 bn, need I say more.

And followed closely by SEC chairman Christopher Cox, for doing little to revamp an agency packed not with market cops but with market crossing guards, who, despite the hope of former Supreme Court Justice and former SEC chairman William O. Douglas---that the SEC would be the shotgun behind the stock market's door--instead proved the agency is more like a water pistol.

One example: The agency and other regulators examined Madoff at least eight times in 16 years, but looked away time and again at results that often were not just improbable but mathematically impossible, as analysts now note. And it ignored the Cassandras shouting watch out!, including money manager and investment investigator Harry Markopolos, who had been trying to explain Madoff's fraud to the SEC since 1999.

And for practicing institutionalized juvenilia, where market miscreants can settle SEC cases by neither admitting nor denying their malfeasances (yes, no, maybe so).

No votes here for Alan Greenspan, blamed for overseeing back-to-back market bubbles as he kept monetary policy loose and rates astonishingly low, as he did little to rein in berserk bank lenders, as he all the while explained his actions to a mystified, fawning Congress in testimony that brought obscurantism to an art form, leaving some to wonder whether they needed to put a GPS system on the central banker's thoughts.

You Let Your Voices Be Heard

You weighed in your typical smart, hilarious fashion. I excerpted and cleaned up your typos here--and thanks so much for the kind, very generous words of encouragement from John Steinhauser (you read it five times, my goodness), Earle, Teri G NV, Carla Ballwin, Tom Jones, much appreciated.

From Aaron James: Chris Cox for being the Brownie of our current financial Katrina.

From Corey: "I think the ratings agencies have the worst CEO's and there is no best CEO. Oh wait, CEO is best. It's the best epithet. I can't think of a more offensive thing to call someone than CEO. It indicates a complete lack of morals and an "I win if you lose more than me" mentality. I think that between CEO's and UAW's, the only real wonder is how the big three stayed afloat for so long!

CEO - Cheating Everyone Officer
COO - Cheating Others Officer
CFO - Cheating Facilitation Officer

From Bruce: My vote for worst CEO of the year goes to GM's Rick Wagoneer, who's multimillion dollar compensation package has only provided the UAW the cover it needs for its own outlandish greed.

From Teri G. NV (thanks for your kind, generous words Teri--EMac): Follow the money...How about the GREDDY BANKERS new sky high credit card rates ready to fire upon the small business folks, God help them in 09...What happened to mortgage insurance premiums? Where did all that money go?

From DavidTheBroke: ...the entire gambling casino called the stock market and those who trade looking for free money have met their Waterloo...What right do banks have "leveraging" at all? Just to create invisible, unearned shadow money is insanity by definition... Take heart. We will be forced to actually produce things again. No more financial "instruments" after the fog of greedy deceit wafts away.

From D.L. Ropa: The top names should start with Barney Frank, Jimmy Carter, Bill Clinton, Sandy Weill, Chris Dodd, Maxine Waters, Meeks and the other Democrat Socialists Party members who pushed the Community Reinvestment Act and protected the Fannie/Freddie gang (they are on video tape on YouTube). Almost forgot Jamie Gorelick and Franklin Raines. They set it up, the greed gang did the rest.

From Steven Hess (thanks for your kind, generous words Steven-Emac): [Elected officials] have no clue that they are the ultimate cause of the problem and the point people for the solution.  

From Carla Ballwin, Missouri (a shout out to Carla from EMac, thanks for being so good to me and for reading me from the beginning): Worst = Madoff, a tragedy. Best = Sheila Bair (FDIC), I saw her on CSPAN recently - impressive woman, her warning should have been heeded two years ago.

From Chris Kinsley: The worst executive has to be Christopher Cox of the SEC. ...I have personal knowledge of frauds that have been brought to his personal attention. He did nothing. After repeatedly contacting Cox he sent me a form letter to contact FINRA. FINRA was run by Mary Schapiro (incoming chairman of the SEC).

From Tom Jones: Best- Bair - I believe she's an honest person caught up in a web she has little control over. From day one she has told us what she believes to be the truth based on the information she is given from the vested insiders with hidden agendas

From Bob Hickerson (thanks for the shout-out, fellow Canisius grad (?)-EMac): My choices of "Worst Executive of the year"

1) Rick Waggoner-GM. He managed to cost stockholders over 97% of equity or $97 billion. While other automakers were making cars that the people wanted, GM made cars that the people avoid.
2) Management at Citibank- They lost $306 billion
3) AIG management-$152 billion lost

The best.
1) McDonald's Management. They were the only a few who had their stock value increase this year.
2) Wal-Mart Management
3) Sheila Bair.

From John Steinhauser (thanks for being so kind and generous John-EMac): [My] vote for best of the year is Mulally. He came to Ford inheriting a gargantuan mess and has done a terrific job of trying to turn it around and change the corporate culture at Ford. It's not there yet, but how can you turn around a 40+ year problem in 2 years, while juggling recession, etc?

From Trader55: FASB and the rating agencies get my votes - followed close behind by Congress.

From Albert Lapointe: A virtual dead lock between Bernie Madoff and Congress.

From Mike D.: My vote goes to FASB BOD. The "mark to market" requirement both improperly inflated the assets on the way up destroyed good assets on the way down...they not only fed the bubble, but may have thrown the most gasoline on the financial firestorm of 2008.

From Marvin E. Johnson: The members of the Senate of the U.S.A. followed closely by the House members for their bitter hatred toward each other and their total lack of support for our Country.

From 16yearmlbroker: [John] Thain gets my vote for worst CEO of the year....SAVED US?!!!...all he did was say we didn't need to raise any additional Capital and then proceed to raise capital at least 4 times. Gave his buddy a $25 million payout package for 3 months and sold us down the river for 10 bucks a share..... GREAT JOB. Then asked for a 10 million year end bonus, then when he got called out on it....said he didn't want it.