The Clever Shark

According to Minardi manager Paul Stoddard, Max Mosley is entirely responsible for the USGP debacle. It took quite a set of exceptional circumstances, but I think that in this case everyone can agree that Minardi comes out of this whole mess looking pretty good.

FIA boss Max Mosley made a ‘threatening, inappropriate’ phone call to Red Bull driver David Coulthardt regarding the USGP fiasco. At some point one has to wonder whether Mosley is actually fit to lead the governing body. Certainly the fact that he wasn’t even in Indianapolis two weeks ago should speak volumes about his dedication to Formula One.

Another Liverpool shocker — feeling neglected, Steven Gerrard announces he wants to leave Liverpool. All this just a day after Rafael Benitez touted him as the center of the team and possible future coach… that’s just embarassing, but then when a club won’t commit it runs the risk of getting a bit of the old “egg-on-face”.

A day after announcing he wanted to leave, Reds skipper Gerrard changes his mind. This is all starting to be a little confusing, isn’t it…

It’s only normal for your average computer geek nowadays to be disappointed by what he (or she!) reads in the press these days, especially when it concerns computers. Typically the most infuriating examples of gross ignorance come from the mainstream press, but every once in a while the IT press itself comes out with a real boner which shows that even those people whose job it is to report on tech developments have little to no idea what’s really going on. Remember when CNET claimed that ‘push’ (a la Pointcast) was the next big thing? Another year it was the portal. Then everyone claimed that on the web “Content is king”, which seemed to me like sheer inanity in action (although confused souls like Steven Brill obviously bought the message hook, line and stinker).

Well, it would appear that the press’s benightedness would extend to a great many things outside of IT, and nothing this week has brought the rats out of the woodwork than the various stories surrounding Richard Grasso’s exit as chairman of the New York Stock Exchange. Frankly some of the coverage is nothing short of shameful. As I read The Register this morning my eye happened upon an article on the very subject which makes yesterday’s New York Post cover story seem positively well researched and moderate (and if you’ve ever read the Post, well, you know what I mean).

At least the Register’s author, Ashlee Vance, can claim ignorance of the matter by being in Chicago. I guess the Reg can’t actually afford to have New York business matters actually reported on by New Yorkers; it’s not like there arent enough people who make a living reporting on the stock market. Then again perhaps the Reg just wants to play devil’s advocate by hiring someone from Chicago, which has perenially been New York’s competitor in terms of trading markets. Either way Vance simply doesn’t know what she (?) is talking about.

The story is — over the past few years the Board of Directors of the NYSE has steadily increased Grasso’s salary (as Chairman) to pretty-much-unimaginable amounts. There is nothing new about this, except perhaps that journalists seem to have been asleep at the switch on the subject until pretty recently. However when they did take interest the “news” of the increases generated such outcry that on Wednesday Mr. Grasso resigned from the NYSE. This obviously wasn’t his idea, and no one is arguing that he wasn’t completely pushed out by a Board of Directors more keen on burying evidence of its own cupidity than on solving the underlying issues that led to the situation. In fact since today (Sept. 19) is “International Talk Like a Pirate Day” we can outright say that Mr. Grasso was unceremoniously made to walk the plank.

Those are the facts of the story. However Ms. Vance (I assume that ‘Ashlee’ is a woman’s name, obviously) seems to have wholly embraced the Board of Directors’ view of the events, namely that Grasso himself was responsible for determining his own salary. I cannot imagine that some at all knowledgeable about the markets would fall for such a stupid trap. Grasso’s salary was decided on by the Board of Directors, not Grasso himself. This very ignorant mistake was the starting point for a miniature essay which seems to have been dictated to Ms. Vance by the humongous chip on her shoulder. While the article stays short of actual invective (that’s the Murdoch-owned Post’s job, I guess) she does little but demean the man and accuses him of “greed”. Yeah, ’cause markets reporters, as is well known, are only doing that job for the greater good of mankind. She then goes on to say that Grasso should return the money — what planet does that woman live on? Having irremediably been made a pariah by a sheepish US press the only thing Grasso should give the world at this point is the extended middle finger, as far as I’m concerned. What exactly was the guy supposed to do, tell the Board that he didn’t want the money they foisted upon him?

That’s not a big deal, however. With $140M in compensation it’s easy enough to the guy to ignore negative press at this point. What makes the article astonishingly amateurish is the fact that Ms. Vance appears to be entirely unable to name a single member of the NYSE board aside from Grasso. That’s the quality of journalism we can expect from her I guess. She does not make mention of a single one. You’d think that she’d be keen to get these people out of the financial virtue closet, given that it is the board members that are responsible for Grasso’s salary having been as high as it was. But it’s so, so much easier to demonize a single man than it is to actually do a bit of research, isn’t it? I mean, you’d think that she could have bothered at least looking up the names on the NYSE web site, for fuck’s sake. But obviously getting to the root of the problem isn’t important here — job 1 in this case was to demonize the guy who was just thrown overboard as ballast. Mind you, this is sure to resonate well with the British press (of which the Reg is a part) by concentrating on one name that can be seen as typical of American over-indulgence, while completely and wilfully ignoring the entire Board of Directors which made the whole situation impossible in the first place. While you’re pointing at Grasso, Ashlee, the whole rest of the Board continues doing exactly what it’s been doing all along for themselves, only by using smaller numbers they hope to escape scrutiny. And it’s working well with the short-sighted American press, whose public appears to believe that any wrong may be righted by the scapegoating of a single individual.

Of course not all reporters are that gullible. CNN is doing a very good expose on the story at this point. So why this rant? It just angers me that people are being paid in order to fulfill journalistic duties and doing such a half-assed, superficial hatchet job which ends up passing for genuine reporting. And indeed it seems likely that the CNN story will end up having much more effect than Vance’s fairly ignorant, one-sided demonstration of self-righteousness (look at how greedy that man is!) passing itself off as insightful commentary. Because Vance’s article is exactly what the NYSE BoD wants to see coming out of this mess — the high-tech lynching of a single individual, one sometimes described as the “best manager the NYSE ever had”, as a way to take public attention away from the Board. That someone pretending to journalistic credentials should fail to see such a cynical and transparent device is beyond belief.

Was Grasso perfect? Of course not. No one is. However one look at the performances of the Dow and the NASDAQ yield some pretty clear clues as to which board had the more effective management. Did he deserve his pay? That’s not for me to answer; it’s up to the BoD to determine what his services are worth. And they did. Something the board should answer at this point is why, if they felt the man was worth the dosh, he was forced to ignominiously walk the plank for no other reason than that the press thought he was overpaid. Is the press in charge of ensuring that the NYSE is well-run? Evidently not, nor should they be. That being the case, why should the press determine what the NYSE Chairman is worth? And why has the Board completely abdicated to the court of public opinion and gave the fifth estate those powers, if not for the clear reason that various persons on the Board realized that if Grasso weren’t made into a scapegoat THEY would be the ones under scrutiny?

So what damage was done in the end? No genuine damage to Grasso, save for wounded pride. Americans do not have a terribly long attention span, and he’ll be running another company soon enough; besides he’s not exactly been left in the street. The same cannot be said for the rest of the NYSE. It’s already known that no one wants Grasso’s erstwhile duties, because inevitably the job carries the already-proven risk of being used as sacrificial lamb by the Board whenever the press will start prying too close (hell, the technique appears to be working, at least with some elements of the press). This leaves a weakened management — apparently led in interim by the affable but not terribly effective Carl McCall — and a vacuum at the top of what is arguably the world’s most influential stock-trading market. Not what you want to see in a recession. But evidently the future of the NYSE and the (at least) short term economic situation of the US isn’t as important to the Directors as covering their asses. That doesn’t quite leave me with a warm, fuzzy feeling and an unbounded confidence that things will somehow start looking up any time soon.

Some don’t feel that Tony Blair’s advisor on anti-social behaviour really gets the nuances of her job. As it were there are people out there who think that binge drinking and engaging in vulgarity-laden rants are things an anti-social behaviour advisor *shouldn’t* be doing. Then again, who’s to say?

US acknowledges torture in Gitmo, Iraq, Afghanistan. In related news, Satan reports that the weather in his neck of the woods is getting “a bit nippy”.

Microsoft buys security software company, immediately axes all linux and UNIX product lines. If you can’t beat them, leverage your monopoly-acquired money to sabotage them.

Having enjoyed Tony Blair’s support on Iraq, George W. Bush now prepares to fuck his British counterpart over on the subject of the environment. Yet another great big “fuck you” from America to the world.

The IAEA exempts Saudi Arabia from nuclear inspections. It makes me feel so good to hear that the country which contributed 15 of the 19 9/11 hijackers isn’t going to be checked for a nuclear program! I can sleep better tonight, I’m sure.