CEO Cayne a Burden to Bear

Bear Stearns(BSC Quote) is experiencing a rocky ride after reporting the first quarterly loss in the firm's storied history. But Bear's bigger problem appears to be a lack of leadership.

Shares of the nation's fifth largest investment bank closed up almost 1% to $91.42 Thursday, but was down as much as 2.8% during the trading day after it posted a loss of $859 million, or $6.90 per share, compared with a profit of $558 million, or $4 per share, a year earlier. Analysts polled by Thomson Financial had expected a loss of $1.79 per share on $625.1 million of revenue for the quarter ended Nov. 30.

The colossal hit turns out to be the largest in Bear's 84-year history -- a history that recently has been marred by wrong-way mortgage bets, mounting lawsuits and a flagging reputation. "Our performance this quarter and for the full year is clearly disappointing and not acceptable to us," said CFO Sam Molinaro Jr., during a year-end earnings call.

Molinaro's diffidence during the call was perhaps the most appropriate way to play the situation after Bear took a greater-than-estimated $1.9 billion writedown on bad mortgage securities and many of its typically stronger business units, including fixed income and equities, suffered.

But what have become even more typical at the embattled investment bank are the inexplicable absences of its CEO James Cayne during its roughest patches.