Xmas Party at Freddie Mac
Posted by Frugal on December 17th, 2007
Thanks to the reader westwest888, here is the Xmas party information for Freddie Mac. After losing billions of dollars and diluting shareholders’ stake, the GSE (government-sponsored enterprise) is throwing a Xmas party at the Ritz Carlton, McLean, VA.
I wonder how shareholders will receive this. Oh, and it’s in your S&P500 ETFs too.
Here is what westwest888 sent me:
It’s not a news story; it’s something I witnessed personally. Freddie Mac lost $2B last quarter and plans to lose another $2B next quarter on $9B in revenue (20% losses). To celebrate, they threw a decadent holiday party at the Ritz Carlton in exclusive McLean, VA. They had a laser printer that printed pictures on chocolate lollipops for the kids, hors d’oeuvres, entertainment. You’d think it was the Goldman Sachs partners dinner. Alas, it was a Government Sponsored Enterprise pissing away money right before they’re going to need a taxpayer bailout.
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December 18th, 2007 at 10:21 am
While Freddiemac may be GSE, they are still private corporation. If the government were bailing them out then taxholders should be mad (that has yet come to pass), but Shareholder might want to be mad. Still I think we can cut them a little slack. Often time Xmas party costs are committed months or years in advance. That other than as gesture, the cost associated even with a nice xmas party at the ritz are really trivial compared to the losses incurred by bad business decisions. Morale is still important.
December 18th, 2007 at 3:22 pm
Would you want to work at Freddie Mac? I sure wouldn’t. If you are losing $2B a quarter, you need to do something to attract top talent. Top talent doesn’t want to work at a place that loses $2B, and has a crappy Christmas party.
Seriously, I respect your opinions on a lot of things, but bashing them for throwing a party? Like Dong says, morale is important. Honestly as an investor I appreciate the fact that my money is going to places that might actually bring a talented employee to Freddie Mac.