When CFOs get fired, I get panicky. But I am not going to get panicky over the firing of this CFO at
. Erin Callan was put out there as if she knew the numbers and knew the business and knew the answers, and it turns out she undid decades worth of trust in Dick Fuld in a matter of just a few months.
Thus Lehman, which was able to stem a similar slide in 1998 because we had a "In Fuld We Trust" situation, instead began to look a lot like
-- it seemed Fuld had checked out and Callan was running the joint.
This has tragic consequences for the firm, because it allowed every single line item that was disclosed to be questioned, and it allowed hedge funds to walk all over the firm because the longs got no answers, or nothing substantive.
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In the end, we wanted Fuld, he folded, and we got this mess.
Earlier in this decade, when it looked like
was in trouble, when the stock traded to $16 in 2001, Dina Dublon, then the CFO of JPMorgan, called me in to show me why the bank wasn't insolvent. She allowed me to have as much as five hours of her time to question her to prove to my satisfaction that JPM wasn't in a jam. She wasn't a dazzler or a face person; she was simply a whiz who knew the answers. It was all public stuff, I just needed someone to walk me through it.
I came away from the meeting telling people JPM was in good shape. She was confident, so I was confident.
Callan inspired no confidence. She was no Dublon. More important, she made me feel that Fuld wasn't engaged.
Apparently he is.
Let's hope it is not too late for this great firm.
At the time of publication, Cramer had no positions in the stocks mentioned.
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