When Was I Radicalized? (Boeing edition)

That's Dick "Gorilla" Fuld, former CEO of Lehman Brothers, who oversaw a criminal fraud conspiracy that went by the name of Repo 105.

Dick Fuld never saw a courtroom, much less a jail cell.

When was I radicalized?

When Dick Fuld walked away scot-free from Lehman with half a billion dollars in cash comp and stock sales during his tenure.

Want to continue reading this and the other 1,500+ essays you won't find anywhere else?

Already a subscriber? log in here

To learn more about Epsilon Theory and be notified when we release new content sign up here. You’ll receive an email every week and your information will never be shared with anyone else.


  1. When do the marches start? Yellow Vests? Tires burning in the streets? Oh yeah they do that in Argentina, not Murica! Yay Capitalism!

  2. Avatar for jlmh jlmh says:

    Really, buyouts fail on a simple question: Why is it better to give company money to share sellers rather than to shareholders?

  3. Go Ralph Tnader!!

  4. Slap top management with serious prison time. After a trial of course. That is more likely to change company behavior than levying huge corporate fines while letting senior management off with scant punishment. “Privatizing gains and socializing losses” reeks of well, sadly post-modern capitalism/plutocracy.

  5. IMO share buybacks should be prohibited, for just this reason. The grant sterilization issue is probably why so many buybacks are done near stock price peaks. Also, share based compensation (which might become less attractive) should have a long vesting period, at least 5 years (if not the 100 years that Muilenburg claims to be his planning horizon lol).

  6. Absolutely drives me nuts when companies BORROW money for stock buybacks to reduce share counts to drive up EPS. Everyone knows that everyone knows that debt (esp non-productive debt) in lieu of equity weakens companies…right? If I were king for a day, the C-suite would not be judged for comp on EPS but Earnings as a Percentage of Enterprise Value (equity plus debt). You borrow $1b for a $1b stock buy-back, share count drops, but Enterprise Value remains the same…no smoke and mirrors financial engineering. Just sayin’.

  7. Agree. And they were illegal, up until 1982 (SEC Rule 10b-18). I’ve heard the (weak) argument that halting stock buybacks would prevent a public company from working towards eventually going private. If a company wants to take itself private, let them reverse the process and do an LBO. Stock buybacks have been weaponized, and there are now more cons than pros in this type of compensation.

  8. But Ben - I think even you’d admit that this is absolutely rational behavior by private sector actors in response to terrible public sector policy. Why should we regulate private sector behavior? Why not “regulate” this horrible government (read Fed QE/balance sheet expansion) policy to eliminate the incentives for this type of activity. Regulating the private sector on exec comp/share buybacks without getting to the root problem will only result in the excess liquidity making its way into another sector, which you’ll then advocate regulating…rinse/repeat.

  9. Stock buy backs used in this way are just a symptom.

    There are two problems.

    1. There’s no way that the Justice Dept. will ever bring a criminal case against Boeing, not one that hits top management or really shackles the company.

    2. Boards which are supposed to be there in order to represent owner interest, does nothing of the sort and has become part of the management.

    Without addressing 1, you will continue to get management that does bullshit things.

    Without addressing 2, you will continue to get management that does bullshit things.

    Killing buy backs would just cause management to get more creative, and even less transparent. At least you can see the bullshit now.

Continue the discussion at the Epsilon Theory Forum

6 more replies


Avatar for bhunt Avatar for merkava18 Avatar for acoates Avatar for peter-perezms-com Avatar for David_Robertson Avatar for quickxotica Avatar for Victor_K Avatar for mpalczew Avatar for Barry.Rose Avatar for kmaillet Avatar for geowhizz Avatar for jlmh Avatar for BillKittler

The Latest From Epsilon Theory


This commentary is being provided to you as general information only and should not be taken as investment advice. The opinions expressed in these materials represent the personal views of the author(s). It is not investment research or a research recommendation, as it does not constitute substantive research or analysis. Any action that you take as a result of information contained in this document is ultimately your responsibility. Epsilon Theory will not accept liability for any loss or damage, including without limitation to any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Consult your investment advisor before making any investment decisions. It must be noted, that no one can accurately predict the future of the market with certainty or guarantee future investment performance. Past performance is not a guarantee of future results.

Statements in this communication are forward-looking statements. The forward-looking statements and other views expressed herein are as of the date of this publication. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and there is no guarantee that any predictions will come to pass. The views expressed herein are subject to change at any time, due to numerous market and other factors. Epsilon Theory disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein. This information is neither an offer to sell nor a solicitation of any offer to buy any securities. This commentary has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Epsilon Theory recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.