02 November 2008

Aaawwww... Tycoons hit by market dive

Where's a box of tissue when you need one?

Here's something that might provide a bit of solace amid the plunging values in your retirement accounts: Warren Buffett is losing lots of money, too. So are Kirk Kerkorian, Carl Icahn and Sumner Redstone.

They are still plenty rich, but their losses ... illustrate how today's punishing market has spared few victims when even big-name investors, corporate executives and hedge-fund titans are all watching their wealth evaporate.

The portfolio damage for some of these high-flyers has soared to billions of dollars in recent months. And they can't just blame the market's downdraft - some did themselves in...

As stocks have plunged, so have the value of chief executives' equity stakes in their own companies. The average year-to-date decline is 49 percent for the corporate stock holdings of CEOs at 175 large U.S. companies...

"Everyone wants to see executives have skin in the game...," said Steven Hall, a founder and managing director of [a] compensation consulting firm. "But in the end, we have to remember they still have billions to fall back on."

But there have been recent instances where executives' large equity positions have blown up - not only damaging a particular CEO's portfolio but the company's shareholders, too...

Not mentioned in the article is that certain CEO's and their boards must also take responsibility for having poorly managed their corporations.

Three examples of such corporations immediately come to mind: General Motors, Ford and Chrysler.

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