Rubin

In the past I have discussed the China Wall. This was one of the first things I learned when I got into the financial business. It is a fictitious wall that separated banks into the commercial side and the investment side. The idea is the employees on side should not discuss business with the other side since the commercial side might be tempted to invest customer funds in businesses represented by the investment side. This is what happened in the 20’s and the banks went broke when businesses failed. A law was passed in the 30’s to prevent this from happening again. The law was named after its sponsors Senator Glass and Congressman Steagall. For many years various interested parties tried to repeal Glass-Steagall and in 1999 they succeeded.
The CEO of Travelers Insurance Sanford Weill wanted to merge with Citibank which was run by John Reed but they needed to get rid of Glass-Steagall to allow such a merger. Weill was a mover and shaker and had influence with Fed Chairman Alan Greenspan and Treasury Secretary Robert Rubin and so with their help he was able to push through the repeal. The new company was called Citigroup and was the biggest merger in US history and became the largest financial institution in the world.
Now here is the interesting part. Rubin left the government and got a job with Citicorp and over the next ten years he was paid $115 million while he helped to run the company into the ground.
Here is a quote from the new media:
Rubin made at least $115 million (plus stock options) between 1999 and 2008, before the feds had to inject $45 billion and then guarantee $300 billion of the firm's liabilities to keep the place afloat.
Rubin told the Wall Street Journal in November 2008 that he was worth every penny -- and then some. "I bet there's not a single year where I couldn't have gone somewhere else and made more," he said.
Is this a great country or what!