Grasso versus the Nasdaq
Compare the 2 charts below. I find it fascinating -- and perhaps not coincidental -- that
Dick Grasso's compensation looks an awful lot like the Nasdaq on a 1 year delay.
The NYSE Chairman's pay package was a bubble of its own . . .
Its not too hard to imagine that the NYSE Chair's compensation package was very much a reaction (and eventually, an over reaction) to the frenzied Nasdaq bubble. At that time, the Big Board was struggling to remain relevant, The Nasdaq -- the sexier, hipper, electronic exchange -- threatened to marginalize them. The future was the internet, and the internet was on the Nasdaq.
So Grasso stayed the course, and waited out the bubble. He was a reassuring voice during those straining times, tirelessly promoting the NYSE, while keeping the Nasdaq at bay. He did an admirable job keeping most of the NYSE listed Tech firms put.
Its not too hard to imagine that NYSE had fears of Richard Grasso joining the extremly well compensated dot-com CEOs (like Meg Whitman or Jeff Bezos). The package they gave him looks less like a regulatory agency, and even less than an Investment bank, and more of an option laden dot com superstar.
Without that pile of dough, the NYSE may very well have lost Grasso to some well funded start up. After the fact, it looks egregious for a regulator to have made $200 million. But at the time, it might have even seemed prudent to these guys.
Sources: Nasdaq chart courtesy of Bigcharts.com
Grasso compensation chart courtesy of "New York Times,"
Grasso Giving Up $48 Million in Benefits,
by Floyd Norris and Landon Thomas Jr.,
September 10, 2003
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Very nice comments you made over at CalPundit.
Posted by: Rob | Sep 10, 2003 8:00:07 PM
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