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Tim Quast
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We're All HFTs Now

In this guest commentary, author Tim Quast looks back at the history of HFT and how the market has evolved to where many firms now fit the definition of high-frequency trader.

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February 1, 2004

Traders Side With Dick Grasso

By Gregory Bresiger

Enough already about Dick Grasso's pay. That's the consensus of opinion from several trading professionals, most of whom do not want to comment publicly on the Grasso controversy.

Nevertheless, they are generally annoyed that regulators, including the Securities and Exchange Commission, are investigating the recently departed NYSE chairman and CEO and possibly want to take back some - or all - of what the exchange paid him.

"It would be unprecedented if it happened," said Arthur Pacheco, a longtime trading executive with Bear Stearns. "If they could do this, then they could do it to other executives."

Speaking about his own firm, Pacheco added that, "I am very happy, for example, that we paid Ace' Greenberg what we did. Is it a lot of money? Yes. Has it also made a lot of people much richer? Yes."

Last year, several Bear Stearns bigwigs made it into the highest tax brackets. James Cayne, the chairman, was given $117 million in deferred compensation. And three other high profile executives - including executive committee chairman Alan Ace' Greenberg, carved up $210 million in stock compensation.

Grasso, who received some $189 million in a compensation package before he stepped down, has been criticized by his immediate successor, John Reed. "Serious damage has been inflicted on the exchange by the unreasonable compensation of the previous chairman and ceo," Reed recently wrote.