One of the headlines making its rounds in all newspapers worldwide is the story of the fall of Bear Stearns & Co Inc.(BSC), one of the largest Global Investment Banks and Securities trading and brokerage firms in the world. For a bank having braved several market recessions in the past, including the Great Depression of 1929, this fall comes as a shock to many.
BSC was known for its distinctive performance, and unique employees (close to 15,500 world wide! ) that it housed in its 85 year long tenure from 1923 to 2008. A two time winner of the "Most Admired Company" tag in the Fortune Magazine and the creater of one of the most widely read Market Intelligence report, the "Early look at the Market- Bear Stearns Morning View" failed to get an early view of its preciptious fall on March 16th 2008. The event is all the more shocking as it happened after a firm denial of any cash liquidity problems faced by the company and its Chairman Mr James Cayne , was found participating in a Bridge tournament just after the denial ! Barely a week since then and BSC stock went down to effectively 0! and JP Morgan bought out BSC paying a paltry $2 per share!!
A very interesting character in the rolls of BSC was Alan Greenberg, the CEO of BSC for nearly two decades begining in the late 1970s. His memos to his employees are famous world over for thier candid quality , with a tinge of humour. (It has even been published as a book for the reading pleasure of millions outside BSC ) He wrote to them about a wide array of subjects including the ever so popular topics on Cost Cutting. He is known to have been a cutting writer, and a gentleman who glided his company over the waves , the troughs and peaks. His famous methods include saving on paper clips and reusing paper. But many people also find his weird cost cutting exercises amusing and impractical , like Tying knots on rubber bands to reuse them, Licking one half of the envelope so it can be reused etc.
I will present an excerpt of this memo, dated March 13 th 1979 (Kindly note: this is Copywrighted material from the book "Memos From the Chairman" by Alan C Greenberg).
"........it certainly looks like we have a dynamic future as long as we remember the words of the famous philosopher Haimchinkel Malintz Anainikal: "thou will do well in commerce as long as thou does not believe thine own odor is perfume'..."
That's exactly what the Great Bear Searn & Company Inc. did!!!