Executives at Citi Follow Other Banks' Lead in Declining Bonuses to Head Off Furor

Pity the poor Citigroup executive who must forego his bonus purely to ward off near-certain flogging by the media and angry taxpayers footing the bill for its bailout.  The Citi chiefs recognized that paying themselves bonuses in a year where they flushed billions of dollars down the toilet and required two bailouts from the government would be political suicide.  The New York Times article quotes Vikram Pandit with: "The harsh realities of 2008, primarily our earnings results, mean that our bonus pool is dramatically lower than last year."    The article goes on to say that bonuses at the top will be down at least 40% for 10 members of its senior leadership team.  Call me crazy, but somehow "at least 40%" doesn't cut the mustard for me.  I would like to recommend "at least 77%" instead, for that is precisely how much Citi's stock was down in 2008.  Or how about "at least 95%?"  For this is the indignity that Wachovia employees were handed for coming in to work in 2008.  Despite Wells Fargo rescuing the Wachovians from their fate as future employees of Citigroup (or more likely just members of the unemployed) after an FDIC seizure, according to the New York Times story, the California bank is refusing to cough up retention packages and bonuses to Wachovia's employees to compensate for Wachovia's stinginess.  A top Wells Fargo executive is quoted with announcing to a group of Wachovia's bankers the following "I know that's very painful to hear, but that's the reality.  It just would have been irresponsible to the company's shareholders to do anything else."  The New York Times managed to find an embittered Wachovia third-year Vice President, who at least had the presence of mind not to identify himself, to make the audacious claim that the bank's decision was putting its employees in "financial extremis" and in some cases, at risk of not making their mortgage payments.  While it is certainly true that if you spent every cent of your bonus money during the biggest boom Wall Street has ever witnessed, and assumed that your bonus was guaranteed ad infinitum, then yes, you are definitely up the creek now that you can't make the mortgage payment on your $(insert a number) million house.  The thing is, that's not really your employer's problem, nor should it be.  

For years, private equity and hedge funds fed the finance compensation boom by poaching already highly paid Wall Street employees and offering them a bigger piece of their profits.  While alternative asset managers rewarded very richly to the upside, they can't pay when they lose money, as 20% of 0% (and more likely negative returns) is still a big fat donut.  After a brutal year for hedge fund and private equity returns, coupled with record redemptions, the competition that was willing to pay up for "talent" is gone.  It seems that several boom years on Wall Street corrupted some executives and employees into thinking that they should get a bonus every year no matter what, even if their employer lost, for example, $22 billion in a quarter (i.e. Wachovia,) was seized by the FDIC, and more than likely would not have been saved by another bank if it weren't for the government's largesse.  

While my thoughts go out to the naive third-year Vice President quoted anonymously in the New York Times article who now finds himself in "financial extremis," I'd like to offer some unsolicited words of wisdom:  First of all, congratulations, you still have a job.  Second, suck it up, downsize, kiss some ass, and keep your thoughts to yourself at work as well as dinner parties, particularly if you happen to go to dinner parties with people who don't have six-figure salaries or are unemployed during a major economic downturn.  And last, never forget that third-year Vice President = Very Expendable.  

Weekend Bailout/Merger/Banking Alert

Germany's Hypo Real will receive a new 50 billion euro "rescue package" after a bailout package negotiated last weekend failed to materialize.  The German government and the Bundesbank have claimed that Germany's second-biggest property lender is too big to fail.  Meanwhile, BNP Paribas will buy 75% of Fortis Bank Belgium from the government for 8.25 billion euros in stock and purchase the Belgian insurance operations.  BNP Paribas will also acquire 66 percent of Fortis's bank in Luxembourg.  

In the US, Citigroup and Wells Fargo spent the weekend in court battling over Wachovia, the US bank that was ordered to merge last weekend with a bank, any bank, just merge before the opening bell on Monday.  The FDIC threatened to seize Wachovia if a merger was not forthcoming.  If you missed the action, here's a quick summary:  Citi bid $2 billion for parts of Wachovia on Monday.  Wells Fargo offered to pay nearly 7x Citi's bid on Friday for the entire bank.  This really pissed off Vikram Pandit so much that he filed suit against Wells Fargo.  He even called the Wall Street Journal and told them to replace the stock photo of him grinning like a loon with one where he looks angry, because he's not fooling around.  It appeared as if Citi won a victory in court on Saturday when it persuaded a New York state trial-court judge to extend the exclusivity agreement between Wachovia and Citigroup until Friday.  However, Sunday a state appeals-court judge overturned the extension of the exclusivity agreement.  Meanwhile, the Fed has jumped into the fray and asked the battling banks to make nice and work out a deal.  According to the Wall Street Journal, Citi and Wells are being asked to carve up Wachovia along geographic lines.  I would bet that a carving up of the bank will not pan out despite the Fed's best efforts and Wells will more than likely wind up owning Wachovia.

As an aside, I must note how amazed I am at how quickly the court system in America works when something "very important" is on the docket.  I spent six weeks serving as a juror on a very brutal murder trial this summer.  The murder happened in 2002 and it took six years to come to trial.  The prosecution had ample evidence for a conviction and the jury found the defendant guilty.  During the six weeks of my service, the court never met on a Friday, much less the weekend.  So I have to ask, how did Wells Fargo and Citigroup get to argue their case over the weekend in two different court rooms?    

A weekend's worth of more bailout negotiations by banks and governments around the globe have only served to intensify fears over the soundness of the banking sector.  Markets that have opened are already falling again this Monday, while S&P futures point to a lower open in the US after a brutal week for equities last week.  The good news in all of this?  The short-sale ban expires on Wednesday, so investors can line up their orders for Thursday morning.  Longs have three more days to sell their stocks which makes me wonder if the market will go down more at the beginning of the week as longs try to front-run the shorts.  Furthermore, with hedge funds having their worst September ever, is there anyone left who can still afford to short?  

Citi Cries Foul, Citing Exlusivity Agreement With Wachovia

The Wall Street Journal is reporting that Citi is claiming that Wachovia is in breach of the Exclusivity Agreement it signed with Citi earlier in the week. Citi states that "Wells Fargo's conduct constitutes tortious interference with the Exclusivity Agreement." Apparently, it's about to get ugly as Citi is using nasty legal terms like "tortious interference." The FDIC has put out a statement that it stands behind the Citigroup deal. Might we see a bidding war over Wachovia, who many had given up for dead at the beginning of the week? I find it hard to believe that the FDIC wouldn't welcome this opportunity to get out of the loss guarantee it granted to Citi and allow a much stronger institution to take over all of Wachovia. Not only is the Wells Fargo deal better for the FDIC, it is better for shareholders of Wachovia, for debtholders of Wachovia and for confidence in the market. Naturally, Citi is pissed because it thought it was getting a sweet deal and had catapulted itself into favored status with the government. But if it wants Wachovia, it better be prepared to pay more.

Wells Fargo Snags Wachovia From Citi's Clutches

In a surprise move, Wells Fargo bested Citigroup's bid and snatched Wachovia as its prize. Wells Fargo agreed to pay $15.1 billion in stock for Wachovia, or roughly $7 a share, a significant improvement over Citi's $1 a share bid. Better yet, the Wells Fargo bid does not include any government guarantees. While Citi's bid included a promise from the FDIC to take a maximum of $270 billion in losses after Citi took the first $42 billion, Wells Fargo has indicated it has the stomach to swallow any potential future losses from Wachovia's ailing mortgage portfolio. This is proof that the market has the ability to find value in the banking sector without any need for a government bailout. Some might say that Wells Fargo waited to pounce on Wachovia until it was relatively assured of a bailout package passing in Congress. But then, it should've waited until the unpredictable House actually passed the legislation. Furthermore, Wells plans to issue $20 billion in additional equity to help finance the deal. With the stock near 52-week highs, issuing stock while the SEC short-sale ban in still in effect is brilliant and entirely predicatable. Any bank that doesn't take advantage of this window of opportunity to raise equity while the shorts are banished from trading should be immediately shorted when the ban expires.

Uber-Bailout Weekend

Lawmakers have reached an agreement on the the $700 billion bailout bill, which is expected to go to a vote tomorrow. Although filled with many provisions to "protect the taxpayer" and offer relief to borrowers in danger of losing their homes to foreclosure, the bill grants significant discretion to the Treasury to determine pricing of the assets. The Treasury has 45 days to issue guidelines on the composition and pricing of assets the government intends to buy. Meanwhile, 45 days is nearly a lifetime in this market. Banks and lenders are dropping like flies all over the world. B&B, the UK mortgage lender that was instrumental in financing the housing boom in the UK, was nationalized this weekend. Fortis NV, recieved $16.37 billion in loans from The Netherlands, Luxembourg and Belgium after BNP Paribas and ING walked away from buying the company. Germany's Hypo Real Estate Group may need a rescue by German banks this weekend. In the US, the Wall Street Journal is reporting that Wachovia is in advanced talks to sell itself to either Citi or Wells Fargo. The Journal article states that the government is involved in negotiations, without offering details of which agency is brokering the deal. I suspect that if the government is involved, Wachovia shareholders will not be getting a premium for their shares. Wachovia had stated several times last week that it had ample liquidity and didn't need to hurry to do a deal. Of course, WaMu was making the same hollow claims the day before it was seized by the FDIC. A deal will most likely be struck before the opening bell tomorrow morning.
What to make of all the frantic activity over the weekend? Clearly, the credit contagion is spreading rapidly and taking the weakest players down in a furious wave. It seemed as if the market had grown accustomed to one, maybe two banking failures, conservatorships, or shotgun mergers in a weekend. This weekend we had three bailouts in Europe and one probable takeunder in the US. Is this bailout plan really going to make a difference? By the time it is implemented, we'll have three banks left and the central banks around the world will already own the rest. If Mr. Paulson doesn't get the plan off the ground soon, he'll find it's too late to buy the assets because the government will already own them.

Watered-Down Government Bailout Package Close To Completion

Although the bailout plan has not been finalized, lawmakers claim they will have a deal by Sunday night. The plan has been modified significantly from Paulson's original "Give me $700 Billion and don't ask any questions" proposal. You can read the full summary of the draft proposal on the Wall Street Journal's website. Some of the highlights include:

• Cuts the plan in half from original $700 billion, with congressional review required for more funding
• Gives taxpayers an ownership stake with participating companies
• Puts taxpayers first in line to recover assets if participating company fails
• Guarantees the taxpayers are repaid in full [intentionally vague?]
• Allows participation from pension plans, local governments and small banks
• Limits CEO compensation
• Recovers bonuses based on promised gains that later turn out to be false
• Allows government to facilitate mortgage modifications

This outline, which appears to offer significant protections to taxpayers, still lacks the necessary details related to pricing of the illiquid securities. After all, much disagreement exists over whether the goverment should pay "hold-to-maturity" prices versus "fair value." I suspect that allowing the government to take an ownership stake in the participating companies suggests that the government will pay above fair value prices for the illiquid assets, with expectations of making money on equity participation. The other key component is putting the government first in the recovery of assets if a participating company fails. It doesn't explain what sort of equity stake the government will take in pension plans or government organizations to help recoup potential losses from purchaing their illiquid assets. Furthermore, I don't understand why a pension plan (which should always hold assets to maturity) would need to sell assets at "distresses fire-sale" prices. But I digress...

I do think this is a much better plan for taxpayers, which frankly is a relief, because it means that my head won't explode from the recent accumulation of steam. However, since this is a financial market blog, I will focus on how I expect the near-inevitable passage of the bill to affect the markets and whether it will do anything to restore order to the chaotic credit markets.

I don't believe that this plan is what the credit markets were hoping for. Because of the government's ability to take a stake in the participating entities, only banks that are in serious trouble will want to participate. Solvent institutions will not want to dillute their equity holders and panic their debtholders. Because the government's equity participation will now supercede every other creditor in bankruptcy court, expect distress in bond prices of senior secured obligations of banks that need this plan to ditch troubled assets. My suspicion is that Wachovia's debt, already trading at depressed levels, will be distroyed on this news. Furthermore, I don't believe that the market will interpret $350 billion as a big enough fund to resolve what is most likely a trillion dollar problem. The Fed is already financing over $350 billion in dodgy assets for banks that cannot obtain financing elsewhere because of lack of transparent pricing and counterparty risk fears. This plan doesn't seem to provide reassurance that all of those fears are misplaced, particularly given the UK's nationalization of B&B over the weekend, Fortis Investment's possible nationalization by the Dutch, and Wachovia's desperation to find a suitor before the FDIC comes knocking. I know that some have been calling for a big relief rally on news of a bailout package, but I suspect if there is a rally, it will be shortlived as reality of the enormity of the situation sinks in.

Wachovia Joins the Party and Settles With Regulators

Wachovia has agreed to buy back $9 billion in auction-rate debt, in a settlement with regulators.  In addition, Wachovia will pay a $50 million fine and make no-interest loans available for investors who need immediate liquidity.  Just in case you wanted access to your CASH instruments, Wachovia will gladly give you a no-interest loan against them.  As is customary, the bank is settling without admitting or denying guilt.  The bank is paying a $50 million fine and taking another $275 million charge against earnings to prove how not guilty it is!  In any event, Wachovia can get back to business, figuring out how to get rid of the $120 billion option arm albatross still wrapped around its balance sheet. 

Wachovia Post-Announces Wider Second Quarter Loss

If you didn't think $8.86 billion was enough of a quarterly loss for Wachovia, you're in luck!  The bank announced that it was increasing its second-quarter loss by $500 million pretax to reflect a hit it is likely to take from a settlement with regulators of the auction-rate securities probe.  The new and improved second-quarter loss is $9.11 billion, or $4.31 a share.  When Wachovia originally reported its second-quarter earnings, the stock posted a monster rally because losing $8.86 billion seemed like chump change at the time to investors, despite the fact that analysts were expecting the company to post a profit.  In any event, there's always the third-quarter to look forward to, the third-quarter pre-announcement, actual announcement, and quite possible post-announcement. 

Wachovia Issues Abysmal Earnings, Admits Golden West is Somewhat Impaired

I'll give Wachovia a bit of credit for warning investors that its earnings were going to be dismal.  When you are a week away from posting a nearly $9 billion loss, and the boneheaded analyst community is still anticipating a profit, it's wise to issue a press release.  Despite the warning, investors were a bit flummoxed by the bank's eye-popping loss of $8.9 billion.  Wachovia posted a loss of $4.20 a share compared with net income of $2.3 billion or $1.23 a share a year earlier.  Wachovia also slashed the dividend to a meager 5 cents a share from 37.5 cents and plans to fire 6,350 employees (updated to 10,750 employees in later news reports).  If you think this is all the bad news Wachovia will report, you haven't read the fine print.  Apparently Wachovia's $8.9 billion loss did include a $6.1 billion impairment against goodwill due to its acquisition of Golden West Financial. (please see updated note below) According to my calculations, however, Wachovia still needs to take at least an additional $9 billion to writedown the full $15 billion in Goodwill it holds against Golden West acquisition.  The inability of the company to face the reality that its ill-timed $25 billion acquisition of Golden West Financial was a complete mistake, is a sign that management is clearly still smoking crack.  14% of Golden West's $121 billion in Pick-A-Pay loans, 70% of which are based in declining housing markets of California or Florida, have zero or negative equity.  According to my calculator, that is $17 billion.  For more Pick-A-Pay ranting, please click on the link to all my prior Wachovia bashing.   

Above and beyond the Pick-A-Pay mortgage fiasco, Wachovia did include a $4.5 billion reduction in the value of commercial loans, plus $597 million in investment-banking assets.  So if you thought its lax underwriting skills were confined to residential mortgages, you were sadly mistaken.  As it turns out, the bank is pretty lousy at underwriting loans across the board.  Furthermore, it paid $144 million in legal settlements related to telemarketing and $975 million due to an adverse tax court ruling on lease transactions.  The really good news is that Wachovia was also raided by regulators last week in a probe tied to auction rate securities.  I'm sure that's not going to be expensive either.  Anyone who believes that this is the kitchen sink quarter and the company will start to post earnings again needs to lay the crack pipe down.

Update:  My original post did not include the $6.1 billion in goodwill impairment because the Bloomberg report I based it on has erroneously reported that the company was NOT taking a goodwill impairment charge.  My apologies for the confusion.  For an updated news report, here's the link to cnn.com's story.

Wachovia Warns of Large Losses, Hires New CEO

Wachovia expects to post losses of at least $2.6 billion when it reports earnings July 22nd.  This equates to around $1.25 a share.  Analysts were expecting earnings of 16 cents a share, but I'll get to the part about how useless analysts have been in a minute.  The forecast includes a $4.2 billion pretax charge to build loan-loss reserves, $3.3 billion of which are related to "Pick-A-Pay" loans, which I have mocked relentlessly ad nauseam here at Mock the Market.  Furthermore, Wachovia expects to incur a goodwill impairment charge, the amount of which is still being determined.  Still being determined?  I sincerely hope that they did not pay Goldman Sachs a bunch of money to help them calculate a goodwill impairment charge that my next door neighbor's crazy cat could've coughed up with her next fur ball.  You don't need an abacus to do the math on this one.  They paid $15 billion more than book value for Golden West Financial.  Write the whole damn thing down already!

On to the analyst bashing.  On Thursday, June 26th, I wrote a piece about the speculation surrounding potential suitors for Wachovia and did a very quick analysis of the bank's financials.  I noted that Wachovia had $90 billion of option arms concentrated in California and Florida and $3.5 billion in deferred interest (interest they had booked as income that they had yet to collect from borrowers since borrowers were choosing to make minimum payments) as of the March 31, 2008 quarter end.  I also noted that Alt-A performance had deteriorated significantly in May. (Indymac's demise is further proof of this phenomenon.)  I went on to say that the company had yet to take any impairments against the Golden West financial acquisition and that it would need to take a significant write-down.  Frankly, I spent a couple of hours looking at the company's 10-Q and 10-K before I came to these conclusions.  The jokers aka analysts, who get paid gobs of money, spend all day looking at financials and somehow were expecting the company to post a profit.  How and why?  Because the worst is over?  If you read a major financial publication, have taken a basic accounting class and spent about 20 minutes looking at the company's financials, you could've easily concluded that they were going to lose money.

Wachovia made one other significant announcement:  The company hired Treasury Undersecretary Robert Steel as CEO.  This is actually a very positive development, not because he's a GS alum but because he has Hank Paulson's phone number.  It's always a good idea to know how to get in touch with the US Treasury Secretary.  Particularly if you are bank that may need a bailout in the near future.     

Wachovia Discontinues "Pick-A-Pays", Waives Prepayment Penalties

Wachovia has finally admitted that allowing borrowers to decide their own mortgage payments through its "Pick-A-Pay" loan product was completely idiotic.  The beleaguered lender announced yesterday that it was discontinuing the now world-famous "Pick-a-Pay" loan.  Wachovia also announced that it would waive all prepayment fees associated with its pick-a-pay mortgage to "allow customers flexibility in their home-financing decisions."  I must take a moment to comment on Wachovia's generosity.  After years of waiving principal and interest payments on its loans, it is now waiving the prepayment penalties!  I suppose Wachovia believes that waiving the prepayment penalties will encourage all of the borrowers currently trapped in pick-a-pays to refinance.  However, many of the current pick-a-pay borrowers have opted to pay just the bare minimum allowed, while their principal balances balloon and housing prices fall.  59% of them live in California, 10% in Florida.  Can any of these people actually qualify for any other mortgage currently offered?  If not, do any other lenders still offer option arms?  If so, give me a call, I have a few more puts to buy.  This brings me back to the question I pondered last Thursday in my last story about Wachovia: What is the $120 billion portfolio that Wachovia hired Goldman to "evaluate" actually worth? I'm guessing these loans aren't trading at par.  How big of a discount the loans would garner in the marketplace is a very serious question.  If it is anything higher than 50 cents on the dollar, I will be genuinely surprised.  Judging from the recent price action in the stock, investors are not waiting around for an answer.  

Wachovia Takeover Speculation Heats Up

The rumors concerning potential suitors for Wachovia continue circulate.  Wells Fargo?  JPMorgan?  Anyone?  The speculation has intensified since Wachovia disclosed on Tuesday that it had hired Goldman Sachs to evaluate its loan portfolio, leading many to speculate that it had hired the investment bank to find a merger partner.  Wachovia would be an ideal takeover candidate, if it weren't for one big stinky problem: the "pick-a-pay" mortgages sitting on its books.  Wachovia paid $25 billion for Golden West in 2006, roughly $15 billion more than book value at the time.  Wachovia is left with $120 billion in option arm loans which includes $3.5 billion in deferred interest as of the quarter ended 3/31/2008.  Deferred interest is interest that the borrower has yet to pay because he has opted to pay the minimum amount required by the lender, thus the catchy name "pick-a-pay".  The borrower is not off the hook, he is merely deferring his liabilities.  Under GAAP accounting rules, Wachovia can book this amount as interest income, although it shows up on the cash flow statement because the company has yet to collect the cash.  How much of this deferred interest will Wachovia actually ever collect?  That is highly dependent on the delinquency and default rates of the loans, which are growing significantly due to falling housing prices across the country. 

According to Wachovia's 10-K, 59% of the "pick-a-pay" loans were based in California, 10% in Florida, and the remainder in various other parts of the country.  To summarize, nearly 70% of Wachovia's option arm portfolio is concentrated in two states where home prices have plummeted in the past year.  So Wachovia has $90 billion in exposure to borrowers in California and Florida who are making minimum payments more than likely because they could never afford a fully amortizing mortgage, and are probably now underwater on their mortgages.  According to Housing Wire, performance on Alt-A mortgages significantly deteriorated in May.  The 2006 vintage of Alt-A loans saw 60+ day borrower delinquencies among first liens reach 21.22 percent in May, up 10% in a single month.  The 2007 vintage saw 60 day delinquencies up 22% to 18.55%.  My guess is that Wachovia has seen its own delinquencies surge since the last quarter ended and realized it finally needed to take significant action.  This is why Ken Thompson, the ex-CEO who was a staunch defender of the Golden West acquisition, was given the boot in early June.  The company, which STILL has not written down the $15 billion in Goodwill from the Golden West acquisition, finally realizes that the loans are impaired, the acquisition was a big mistake, and Wachovia has not taken enough in reserves against potential losses.  What will Goldman conclude after its analysis?  Does any investor was to buy these assets?  My guess is that Wachovia will be forced to take an enormous, eye-popping loss if it sells the "pick-a-pays".  Furthermore, I don't think any bank will buy Wachovia until it can rid itself of the risky loans.  Wachovia is already trading at a significant discount to book value, so it is clear that investors are bracing for some very bad news.  But have they prepared for the worst? 

WaMu, Wachovia Resort To Desperation

Once the bread and butter of Washington Mutual's core business, negative amortization loans are going the way of the dodo bird, the company announced last week.  In a brilliant PR move, the announcement to discontinue negative amortization and "flexible payment" loans was buried in the ninth paragraph of a press release WaMu issued on June 18th touting an additional $1 billion assistance fund for troubled mortgage borrowers.  The press release did not indicate what the company planned to offer as assistance to its credit card account holders.  Through its ill-timed purchase of Providian Financial, WaMu entered the business of credit card lending to questionable borrowers in 2005 at the peak of the bubble, and has aggressively increased its credit card accounts since.  No surprise that WaMu has the highest proportion of overdue loans among the top 15 providers.  Given how lousy WaMu's timing has been, I suppose it is also not surprising that it took WaMu a year into the credit crisis to figure out that maybe, just maybe, it should stop offering negative amortization mortgages.

Meanwhile, Wachovia has apparently given up trying to solve its own "pick-a-payment" mortgage problem and has hired Goldman Sachs as an adviser.  I imagine that Goldman may take one look at Wachovia's loan portfolio and immediately short the stock.  Wachovia's hiring of Goldman has started the rumor mill once again that some white knight will come along and rescue Wachovia.  JPMorgan is always considered a likely contender, but I'd bet against it.  Wachovia, after all, is still a $17 stock.  When it gets to $2 and comes with a $50 billion loan guarantee from the Fed, maybe Jamie Dimon will start negotiating.  

Goldman was more than likely tapped by Wachovia not only because it has managed to avoid damage suffered by its competitors, but possibly also for arranging the restructuring of Cheyne Finance, the $7 billion SIV that collapsed last year.  If any bank knows what to do with a bunch of underperforming assets, it should be Goldman Sachs.  More than likely, Goldman's solution for Wachovia will mirror what they just pulled off with Cheyne.  Just spin it all off into another investment vehicle and make sure that Goldman gets paid a portfolio management fee after marking the assets down significantly.  Nice gig if you can get it.

Wachovia and Wa Mu Give Leaders the Boot

Wachovia ousted its CEO Kennedy Thompson, as the board opted to blame him for losses that cost the lender more than half its market value...so far. Meanwhile, in other juicy scapegoating news, Washington Mutual's Chairman Kerry Killinger stepped down, after shareholders voted to oust him in April. The board indicated it was responding to feedback from its shareholders. The board may also wish to canvas shareholders for some good ideas on how to stop losing buckets of money. Anyone with feedback in that department is welcome to put it on the shareholder's ballot for a vote. But you'd better hurry because we may not make it to the next shareholder's ballot...