I believe the US Government is acting "crazy" to be so generous to failed companies' top executives.
Maybe the US believes the Chinese Government will play Santa Claus when December 25 cometh around every year because the 1.3-billion-peopled nation can't afford to let the American economy sink!
Hail to The Titanic journey of faith -- hail to the Communist slowly turned Socialist and surely becoming MORE CAPITALIST.
It's a question of WHEN WE SAIL WE SAIL TOGETHER,
When we sink, LET'S SEE WHO SINKS FIRST EH?!
US approves millions for Fannie, Freddie execs
WASHINGTON, December 24, 2009 (AFP) - US officials Thursday unveiled multimillion dollar pay packages for executives at bailed-out mortgage finance giants Fannie Mae and Freddie Mac in a new step back from a clampdown on executive compensation.
Documents filed by the regulator for the two firms showed Fannie Mae chief executive Michael Williams and Freddie Mac CEO Charles Haldeman could each earn up to six million dollars per year, although some of that is deferred or conditioned on the performance of the companies.
Six other high-level executives at Fannie Mae and four others at Freddie Mac could earn over one million dollars, depending on performance,.
The regulator for the firms, which were seized by the government amid a meltdown in the housing market, said that even with the new pay levels, compensation for the top executives is down 40 percent from before the firms were placed in government "conservatorship."
Edward DeMarco, acting director of the Federal Housing Finance Agency, said these firms need competent executives since they play a role in funding three-fourths of all new residential mortgages.
"The enterprises must attract and retain the talent needed to accomplish these objectives," he said.
The two firms are not subject to the limits on firms bailed out under the Troubled Asset Relief Program, which was passed by Congress after Fannie and Freddie were seized.
Firms receiving "exceptional" aid under TARP will see their executive salaries limited to 500,000 dollars annually in most cases, but some exemptions have been announced.
FHFA said it consulted with the TARP "pay czar" to come up with packages that include a base salary as well as a performance-based incentive and deferred salary.
On Wednesday US authorities released details of salary cap exemptions to bailed-out firms including General Motors, Chrysler, and GMAC, the former finance arm of GM, using the authority of the TARP law.
The TARP limits also apply to insurance giant AIG, while Citigroup and Bank of America will be free of those restrictions in 2010 since they repaid the government for TARP shares.
Fannie and Freddie are both government-chartered, shareholder owned firms established to provide funding to the housing sector, mainly from the issuance of bonds.
The government took over the two firms in September 2008 and placed them in a "conservatorship" in a bid to avert a financial system meltdown from the housing crisis.
Under the plan, the two firms got government-appointed chief executives and shed their mission of shareholder profit. The Treasury agreed to inject 100 billion dollars in each if needed and the government effectively guaranteed the estimated 5.4 trillion dollars in assets of the two firms.
The new documents showed Fannie Mae's Williams would receive an annual base pay of 900,000 dollars. Added to this, but subject to conditions, would be deferred compensation of 3.1 million dollars and a bonus of two million dollars.
The deferred salary is designed to replicate the stock awarded to executives at other bailed out firms. Fannie and Freddie are prohibited from providing corporate shares to employees.
Packages worth over one million dollars, also subject to conditions, were approved for Fannie's chief financial officer and five other key executives, according to documents filed with the Securities and Exchange Commission.
At Freddie Mac, a similar package was structured for CEO Haldeman, while chief operating officer Bruce Witherell could receive up to 4.5 million dollars, including a bonus and deferred compensation.
Freddie's chief financial officer and two others could receive between 2.7 million and 3.5 million dollars.
The news comes amid a broad effort in the United States and elsewhere to limit lavish pay packages that critics say encouraged reckless actions leading to a near-meltdown of the financial system. -- AFP
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To all my EsteemedReaders and Friends of the Christian faith out here/hear:
"MERRY CHRIsTMAs
and A ap AP ap NU'E YEaR 2010!"
greAtings from YL Chong ~~ Desiderata
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