Bank of America CEO Ken Lewis bought 200,000 shares ($1.2 million), while JPMorgan Chase CEO Jamie Dimon purchased 500,000 shares ($11.5 million). Six other BAC board members bought more than 500,000 common shares also.
The market celebration seems odd, when you consider that the poor strategic acquisitions, inept risk management, and otherwise errant policies that drove these stocks down 90% from their peaks were the brainchilds of these same insiders.
Given the past track record of their corporate investing acumen, the insider purchases by this group of ne’er-do-wells should hardly be cause for jubilation.
Then there is this additional tidbit: These insider purchases were made from the proceeds of ill-gotten gains — the vast sums of money that management has been overpaid for the fine job they did driving these companies into the dirt.
The thought process must have gone something like this: Now that we have been paid 100s of millions for turning our stock price into fertilizer, let’s take a few cents of that money and buy a few shares of stock.
The entire sordid episode is sickening, and hardly cause for investor appluase. Instead of buying stock, these incompetant corporate clowns should be falling on their own swords. If they don’t do so soon, it will be time for investors to start gathering pitchforks and torches, to chase the money losing managers out of town.
Originally published at The Big Picture blog and reproduced here with the author’s permission.