We’re With the Rabble on CEO Compensation

We side with the rabble rousers – Chris Dodd, Barney Frank, and all the other hard-core lefties in Congress — on the corporate pay issue. For every CEO who got an eight-figure bonus in recent years, we knew a dozen guys personally who could have gotten the job done for $250k and a health plan. Dick Grasso, the former head of the NYSE, was the last straw. After a four-year legal battle with Elliot Spitzer over his nearly $190 million compensation package, Grasso prevailed in the Appellate Court. “From the get-go, there was never anything improper,” he told reporters after the decision.  Improper? Perhaps not. But indecent?  For sure.

The Wall Street Journal  had the chutzpah to assert that Grasso was worth every penny of the huge bonus he got for running the exchange for eight years. In fact, like Bill Clinton, he was simply in the driver’s seat when economic cycles were at their most felicitous ever.  As a result, like so many other executives working at his pay grade, Grasso benefited from share prices that were so ridiculously inflated that no one noticed when tens of millions of dollars were skimmed by the corporate brass. 

Thumb Twiddling Ahead?

To help rein in executive pay, Geithner has appointed Washington attorney Kenneth Feinberg as “pay czar.”  We don’t know what Feinberg’s plans are, but he may wind up twiddling his thumbs as the U.S. economy sinks deeper and deeper into depression. The Obama Administration’s proposal would give shareholders a voice on executive compensation. But then, shareholders have always had a voice; they just chose not to say anything. That’s the way the fat years played out:  shareholders’ IRAs were reaping steady gains, and anyone with money invested in stocks was making money. Who cared whether top-level executives were getting filthy rich? Now, with the economy in a funk that could last for decades, the opportunities for perfectly legal corporate looting will be few and far between. Grasso and his ilk would need an armed escort just to get in and out of the courthouse.

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 Calling All Traders…

Ever found yourself sitting on your thumbs after the opening bell, waiting for the dust to settle?  If so, then you know how much harder it becomes to trade profitably as the day wears on. That’s because once a market has established an opening range, trading becomes essentially a frustrating game of second- and third-guessing other traders who are trying to second-guess you.

But suppose you were able to predict the high or low of the opening range beforehand?  Using your crystal ball, you could be waiting at the bell with your bid or offer, ready to pounce on what will later turn out to be at the high or low of the day. Wouldn’t that be a trick!

That is exactly what we attempt to do each morning, using the Hidden Pivot Method to spot predictive price patterns that may have occurred overnight. If you want to see how this is done, and how precisely, please join me for The Morning Briefing each day before the opening this week and next. These 20-minute sessions will commence online sharply at 9:00 a.m. EDT. Our goal will be to identify trading opportunities for that day, with a particular emphasis on Comex Gold futures and the E-Mini S&P.  The Morning Briefing will be open to all, but to sign up you will need to register by clicking here.  See you Thursday morning!