Sympathy is in short supply for AIG’s boss

Not too many tears for AIG's beleaguered chief executive Bob Willumstad, City Spy senses.

"He is a man who is right up his own origin," reflects a former colleague from Citigroup, where Willumstad was COO.

"He adopts this Just call me Bob' approach, and spends much of the remaining time demonstrating that was all a cover, by game-playing — not reading the report book through, not returning calls and effectively just playing awkward, illustrating I'm in charge, and you're not'. It felt, to me, that there was an espoused egalitarianism; in reality, there was a very clear inner circle."

Ouch. Willumstad was appointed chief executive in June 2008. Let's hope Bob enjoyed all three of his months as head boy.

* Willumstad's willingness (recklessness?) in taking the top slot at AIG was inspired, industry observers believe, by his failure to succeed Sandy Weill as CEO of Citicorp. Not that his failure surprised former colleagues.

"If you spend so many of your years so far up Sandy Weill's fundament that you can't see daylight," one of Willumstad's former colleagues tells the Insurance Insider, "why, when Sandy Weill finally gets removed, would anyone not think that you're likely to be halfway out of the door still ensconced?"

* And the winner is...Martin Sullivan, the Essex lad who was ejected from top slot at AIG to make way for Willumstad. This blow to Sullivan's pride was softened by a $15 million pay-off, a $3.7 million bonus, and retirement benefits valued at $3.75 million. A useful cushion. There was also the possibility that he would receive an additional $10.9 million in restricted stock — but he may have to struggle along without that.

The taxpayer foots footie bill

So, when Manchester United (sponsor, AIG) next play Newcastle United (sponsor, Northern Rock) will government officials from the US and UK be cheering on their respective teams? The US taxpayer backing Wayne Rooney and the UK taxpayer funding Michael Owen. Who would have thought it?

* Meanwhile, the omens for the Varsity rugby match (usual sponsor, Lehman) are not good. Given the deepening financial crisis, Oxford and Cambridge may struggle to find a new backer in time. Peter Bridges, chair of Oxford University's rugby club, insists that the match will go ahead in December. Bridges admitted that the current climate "doesn't make things easier" but said finding a new sponsor was "not an impossibility".

* Greg Mankiw was chairman of the White House council of economic advisers from 2003-2005, now he's a professor at Harvard. Here's the opening remarks on his new blog: "Today is the first day of Harvard's academic year, and the first day of a new year of ec 10 [his class]. I will give the introductory lecture at noon. I would like to thank all my friends on Wall Street for doing so much to spark interest in economic issues. You have gone beyond the call of duty, and your timing could not have been better." Quite funny for an economist.

Anxious times at the Wharf

Spotted at All Bar One in Canary Wharf earlier this week: Among the former Lehman Brothers staff drowning their sorrows, a huddle of senior Trinity Mirror executives. Word is that Trinity Mirror chief executive Sly Bailey is under pressure to make more deep cuts...

Awkward questions for FSA

Good to see from the minutes of the Financial Services Authority board meeting in June, that the agenda included discussion of urgent proposals, "to take action to prevent consequences of abusive short selling". But — wait a minute — what form did the discussion take? Three board members were absent, elsewhere; Sir Callum McCarthy was in the chair but also not in the room —he was on the phone — as were a total of seven other directors who were attending to other, presumably more urgent, business but were on the end of the phone. Only Hector Sants, the chief executive, and David Kenmir, chief operating officer, were able to make it. It's not as if the meeting was important. City Spy must have dreamed that an epidemic of short selling via CFDs has plagued the market for years and ruined the lives of many shareholders...

The Indian, the $250k Ferrari and a lesson for Wall Street

This story is doing the rounds. An Indian man walks into a bank in New York and asks for the loan officer.

He tells the loan officer he is going to India on business for two weeks and needs to borrow $5000. The bank officer tells him the bank will need some form of security for the loan, so the Indian man hands over the keys and documents of a new Ferrari parked on the street in front of the bank. He produces the title and everything checks out.

The loan officer agrees to accept the car as collateral for the loan. The bank's president and its officers all enjoy a good laugh at the Indian for using a $250,000 Ferrari as collateral against a $5000 loan.

An employee of the bank then drives the Ferrari into the bank's underground garage and parks it there.

Two weeks later, the Indian returns, repays the $5000 and the interest, which comes to $15.41.

The loan officer says: "Sir, we are very happy to have had your business, and this transaction has worked out very nicely, but we are a little puzzled.

"While you were away, we checked you out and found that you are a multi-millionaire. What puzzles us is, why would you bother to borrow $5000?"

The Indian replies: "Where else in New York can I park my car for two weeks for only $15.41 and expect it to be there when I return?"

This is why India is laughing.

* FSA boss Hector Sants seems to be itching to call the bottom of the market. In a speech yesterday he said: "Market confidence will only return when investors believe they know where the bottom is. The events of the last few days show that we are not there yet — but we are getting closer to that point." Er, Hector, are you qualified, under FSA rules, to give investment advice?

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