CNBC's Brian Sullivan Calls Stumpf's Parachute Payment 'Another Black Eye' For Wells Fargo
According to Sullivan, Stumpf's "$100+ million, headline-grabbing payout" is not only "another black eye" for the stock market, but its a damaging abuse even for capitalism. The executive is leaving Wells Fargo under the "shadow of a massive scandal" and breaches the trust that fuels the stock market.
"The stock market runs on trust," Sullivan wrote. "Trust in the market — and banks in particular — is already bruised and battered. This kind of massive payout for a CEO whose leadership led to a $185 million fine for bad behavior is just another example of poor corporate governance; the kind many [millennials] and young families can point to as another reason they may want to stay away from investing."
Sullivan added that without trust in the stock market, the "market dries up." After all, the baby boomers who are soon to retire and cash in their investments needs to be counteracted with younger investors. Without confidence in the financial markets, there just simply won't be new buyers.
"Confidence is everything," he added.
Bottom line, Stumpf's exit from Wells Fargo "strips away another layer of confidence" in corporate America. This is vital because the confidence is what is needed to "make sure there's ultimately some 'capital' left in capitalism."
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