CEO Disinterested in cutting debt
There is a CEO that shockingly has expressed disinterest in cutting the company's debt...in fact shareholders are worried the CEO is going to increase the debt this year by 10% and another 10% next year, for the remaining 2 years of his tenure. Next year when the company meets for their shareholder meeting, they will get to decide if the CEO should stay or be booted out.
On the most recent conference call for Q1, one shareholder asked the CEO, given that employees in similar companies, similar lines of business, are seeing widespread job cuts, and in fact this pregnant shareholder just lost her job, what the CEO would do in her place.
The CEO expressed how important it is to keep employees hired but never got around to answering the question about what the CEO would do in her place.
Another shareholder voiced some concerns over the comapny's debt rating, which recently got lowered from stable to negative by Standard and Poors. The CEO said that Standard and Poors was just playing politics and only the outlook was being lowered, not the actual debt rating itself...It was a clear sign for investors that the CEO was paying little attention to any potential future negative impacts to the company's ability to borrow.
In a recent letter issued to shareholders by Goldman Sachs, it was clear that the commodities drop in recent days would reverse itself and perhaps reach record levels next year. A stock analyst on the conference call asked the CFO what he thought of that in regards to what could be done to hedge against this...given that higher commodity costs would do further damage to the company's already balooning expenses (which have resulted in negative EPS quarter after quarter for the last 9 quarters).
The CFO answered that they are perfectly happy to keep purchasing their resources from Brazil and they saw no current need to hedge against rising commodity prices.
But perhaps the scariest bit of news that has hit the front page in recent days was the earnings report showing a jaw dropping, $40 Billion loss in last quarter's earnings alone.... $40 Billion!
Oh and the company I speak of is the United States Government (USG).
(CEO) President Obama
(CFO) Ben Bernanke