The Five Dumbest Things on Wall Street This Week
1. Remember the Neediest Executives!Imagine you're in control of a company that, after years of defending the safety of one of its key products, decides to withdraw it from the market, citing safety concerns.
|Merck's Needy Cases Fund
Executive sweets from the makers of Vioxx
Imagine that your stock has dropped 38% as a result, erasing $39 billion from the company's market capitalization.
What do you do next?
Why, make sure your executives are well compensated in the event of a sale, of course!
At least that's what Merck (MRK), the manufacturer of no-longer-sold pain reliever Vioxx, said it did this week.
In an SEC filing Monday, Merck said it had adopted what's called a "Change in Control Separation Benefits Plan" for 230 top executives.
Should these executives be let go within two years of any merger or acquisition of Merck, the lucky folks would win up to three years' of salary, bonus and health care benefits, among other goodies.
No word on what goodies Merck's 63,000 other employees would receive.
Merck's board says it adopted the plan "in recognition of the importance to the Company and its shareholders of avoiding the distraction and loss of key management personnel that may occur in connection with rumored or actual fundamental corporate changes."
To which we respond, because it was key management personnel that got Merck into its latest mess, why is it important to shareholders to keep them around?
2. Meaner Than a Junkyard Fax
|Debits, Credits, Hubcaps
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