this has to have a hobby and fitch the company is failing miserably okay
just to give you a specific numbers in two thousand nine abercrombie fitch only made
two hundred fifty four thousand dollars that's what they met it
uh... time magazine reports that back in two thousand founded
they may four hundred seventy six million dollars
all right so obviously they need to have pride in a different sales model it'll lower the
prices of the ridiculously expensive clothes maybe not paid their c_e_o_ so much but it
turns out that they're paying their c
you know a rediculous amount of money
his name is mike jeffries
and he had been spending
about one point three million dollars eight-year on personal travel
of course you've got a travel in style
if you're companies
not making any money
argues that
uh... what's a salary
his salary is well it changes back in two thousand eight
he made seventy one point eight million dollars
seventy one point
million dollar and keep in mind in two thousand eight uh... the company made a profit of two
hundred seventy three million dollars now
the problem is not the money he made when the company was made a profit although
you could argue i mean that should be shareholder money
you do well of course the c_e_o_'s immediate a reward for that we get that how much you
get reward is a different question
but what your company doesn't make any money
and you're still making it out of money right
and useful demand the air travel on private jets well that's a different question
so
uh... but we don't worry they took away his private jet right but not really but right
away so this is one of the most crazy idea ever okay so this is what they did
they decided to give him a two hundred thousand dollar personal travel allowance per year
almighty first of all that is the creatures
how can you travel
for just two hundred thousand dollars
than a year
and pick up a lot
but since they agreed to that
they decided okay we're gonna give you a are large lump sum
of four million dollars
which doesn't make any sense right because he was already spending
uh... one point three million dollars a year on personal travel and then he said okay fine
you can take that away just give me two hundred thousand dollars a year and on top of that
give me one large months out of four million dollars
for the next four years right so first what we do the math on that date
hardly city any money at all uh... in fact because of other circumstances you may get
a case that they're gonna lose money on this deal
and say what you want to cut expenses
why did you just cut expenses
what did you think they've got an extra billion dollars a year
when discovers that baby any money exactly the problem is that these boards that do the
c_e_o_ compensation the cannot really be able to to the shareholders
the horrors of the company
because obama shareholder of ever covering fitch and you're telling me hammadi you don't
get any money
but i just gives the electric four million dollars
because he promised not to be a task and
spent one point three million dollars on private jets
over the next or more cousins appellate threatened to spend more than that ordered thank you
for threatening that by the way
perspex and process it makes no sense and then of course when you ask about the cause
of capitalism capitalism
but that's not cap wasn't travelers and as you make money
all right you get a certain percentage of that money
but really mostly money supposed to go to the
all the rest of the company right cab was a visit by lose money
and then you give me money anyway
uh... but in these days what's happened is that these boards and c_e_o_s have captured
the company's and they're not really representing the shareholders it's a flaw in the capitalist
system we need to have boards that actually represent owners if you don't the c_e_o_'s
executives in the boris are gonna rob these companies blinded happens in finance where
bob rubin took home hundred and twenty six million dollars
from citigroup and the citigroup collapsed
they were went bankrupt but barbara developments on the board
is on the board for eight years right
at the same thing is happening at abercrombie fitch in the same things can happen at all
these comps
by the way one more interesting tidbit on the story okay
uh... c l_ mike jeffries was voted as one of the top five highest paid worst performers
for the year two thousand eight
by corporate library
and what is the board do
they give a four million dollar bonus
plus he could only travel with a budget of two hundred thousand dollars a year that's
that's uh... i'm not sure i will spend two hundred thousand dollars michael
life on travel that includes
planes trains and automobiles okay
anything that prior year ecstatic about effective
it's crazy man our system is busted
the entire system is epic fail
we have to fix it
at one of the laws that you have to did pass gives and at the funny thing is maxine waters
on the most liberal of people in the whole congress is pushing for a law that allows
shareholders to have better control of their boards if you're a real capitalist you would
be one point two percent in favor of outlaw of course they ship if you're a shareholder
babbar coming fetch you should go ballistic over this this guy should be fired not