This is interesting, this says Cheney assigned all future profits in the stock options to charity. If true, then Cheney truly has no upside to a rise in price of HAL's shares. Defend yourself, pgabriel. Deferred comp is something that has already been earned, yet receipt of the money is simply delayed. Halliburton's performance really has no bearing on the amount of deferred comp that Cheney will receive -- provided Halliburton doesn't go bankrupt -- a very unlikely scenario given their investment grade credit rating. Even a bankruptcy would have no bearing on Cheney's pay out -- as the article states that he has taken out an insurance policy. The liberals have no legs to stand on here. None.
PGabrial, Stock does not always go up, even if the company shows significant profits. People bet long term on the stock market, and if investors don't see Halliburton as a good buy, the stock will stay flat. As a person who dabbles, I would never buy it, because of the uncertainty of it's business model and being tied so heavily to the whitehouse. What if Cheney and Bush are out in 2004? The company would not look so good then, would it? DD
Cheney is not lying when he says he has no financial ties to Halliburton. A financial tie implies that Cheney will benefit from Halliburton's success. This is not true. His stock options are worth ZERO and even if there were to be worth something, the profits would go to charity, as stated in RMTex's link. Cheney's deferred comp is money that is rightfully his -- earned during 1999. Halliburton's current and future performance has no bearing on Cheney's payments. This is the issue. The liberals', not surprisingly, are still frantically scurrying to try to understand 1) What is a stock option -- people here still don't know. You know who you are. 2) What is deferred compensation? The liberals are turning to google to answer this question. This should tell you something. When you boil this issue down to its core, you soon realize that Cheney is telling the truth, and the liberals are just out trying to use flawed arguments and their amateurish financial understanding to slander the administration. CASE CLOSED
"Since I left Halliburton to become George Bush's vice president, I've severed all my ties with the company, gotten rid of all my financial interest. I have no financial interest in Halliburton of any kind and haven't had, now, for over three years." i guess is a nice way of saying "I'm a liar"
TJ: It's hard to believe you work in the financial markets when you suggest stock options have *ZERO* value because they are not in the money. They may have no intrinsic value (can't trade them for money today) but they certainly have tremendous potential value. That value is contingent on the performance of the stock -- creating a very significant financial interest!! And a huge conflict of interest. If they have *ZERO* value, why not simply cancel them? That said -- much as I hate to do it -- I have to let Cheney off the hook here. If he truly has irrevocably pledged his options to charity, and has insured his deferred compensation, i have a tough time finding a financial interest here. I think it's a stretch to suggest that receiving payments on a past debt is enough to tie him to the company -- especially given those payments are insured. Very disappointed in the article by CNN. They should have tried to analyze the issue at hand. It would have been so much more informative to lay out the issues -- and to verify that his options are, in fact irrevocably pledged. If they revert to him after he's out of office, I would disagree with his contention of having severed ties. Of course, that's information we don't know. PS Also disappointed that TJ and DaDa jumped to Cheney's defense before they knew the options were pledged to charity. Surely you boys would not have approved of a Dem having stock options in a company that does business with the gov.
Two things, first I'd like to see more info on Cheney's donating any earnings from his options to charity. Secondly, T_J it takes an individual with a low amount of self esteem to brag about knowing what a stock option is. You don't have to have an MBA to know what stock options are. Some companies offer options to the lowest level employees, and I'm sure they don't need a class to teach them the value of the options. Its not a difficult concept. The same thing with deferred compensation. All you have to know is the meaning of the two words to figure out what it is, so you should refrain from throwing around your so called expertise in these topics. We're not impressed.
Two reasons why you are DEAD WRONG in your mis-representation of my quote: 1) I said they are worth ZERO today, which they are. 2) I said they have an INTRINSIC value of ZERO, which they currently do. Now go to your financial accounting textbook/website, look up the word, and come back and apologize to me. thanks in advance Read closer next time before you decide to attempt to correct me. pgabriel -- I am not here flaunting my expertise, you have missed the point entirely. I agree that knowledge of deferred comp and stock options are things that all informed investors are aware of. This is exactly the point. As Maynard proved, many people with strong opinions on the topic know nothing about either of these two simple concepts.
Wow. This reminds me of the time when 'economics expert' T_J talked about army pay being established by the free market...ie, what the!?!?! T_J, his point...the one you missed, and/or avoided, was that the POTENTIAL value of the stock is even more of an incentive for Cheney to seek to raise Haliburton's value than were it cashable...in that he needs to raise it, say through no bid contracts for services in Iraq, and the like...for them to acquire value. Sort of relevant to the discussion of Cheney's lying on ties ( which there are), conflict of interest ( which there is), etc. No? Although if this charity thing is accurate, true, and comprehensive it does sort of make this aspect moot.
So by your logic, if you don't know some detail of a 16th century composer, then that means you don't know anything about any area of music whatsoever? And I'm sure you got every single question on every exam you ever took in B-school correct right? you graduated with a 4.0 right? i didnt think so, so take your conceited, feigned, pretentious elitist attitude and shove it
Wow...My first powerslap from TJ. I'm honoured. Here's your quote Einstein: You were clearly implying the options were next to worthless. They are not. Seriously, you would be ok with the stock options if he hadn't pledged them to charity??
You simply don't understand the two components of value in stock options. I can't believe you would try to argue the point with me, when you don't understand this. Options have two components of value: time value and intrinsic value. Instrinsic value is represented by (today's price - strike price)*number of options. Since today's price is less than the strike prices on the options, the intrinsic value of the options is ZERO, as I clearly and correctly stated. The time value of the options represents their potential (are you listening, MacBeth?). Since Cheney's options are not freely tradeable and most likely have a finite exercise period, their time value is adversely impacted. Secondly, even if the options were to be in the money in a future point in time, Cheney would not receive this money, as he has pledged it to charity. bnb, if you can't understand the difference between me saying an option is worthless and that an option's intrinsic value is zero, then I just don't know what to tell you. Educate yourself please.
I just want to make it clear, that I don't think Cheney's support of the war is affected by his ties or non ties to Halliburton. That has nothing to do with my opposition to this war, or my feelings for the administration being so enthusiastic about it. I take the adminstration at face value when they say they want to form a stable democracy in the middle east. I just think their actions are misguided and they have done a terrible job of handling all diplomatic aspects of this war, and this is just one example. Cheney should have been more clear on his explanation of cutting ties with Halliburton.
TJ -- let me ask it this way...and i'm asking sincerely, because i really don't know...but i'm interested...just got finished with trying a financial fraud case predicated on an alleged fraudulent financial statement. (could have used you as an expert maybe?? ) if i said, give me a balance sheet...would you list stock options as an asset? and if so, what value would you place on them??
one...last...time... I fully understand the value of stock options and that is why i was concerned to learn cheney still held some in Halliburton. In an effort dismiss the article's criticism of Cheney, you stated that the options had a SMALL amount of value IF they were tradable which they are not. You implied it was no big deal. You seemed to have no problem with the revelation that the options were still outstanding. I strongly disagreed. You are now weaseling your words. Clinton would be proud. I agree with you (and macbeth) that the point is moot in this case if they are duly pledged to charity, however the concept is not. Again...I ask you. Please put down you WWF microphone. Do you not consider active stock options a financial tie, and potential conflict of interest to those in such an influential position??
Your inability to grasp this issue continues to amaze. There is NO financial tie when your stock options have ZERO intrinsic value and all future profits are pledged to charity. Halliburton's stock could go to 1,000,000,000 per share and Cheney would see NONE of it. This is about the 4th time I've had to state this. Do I need to do it once more for you? Twice more?
unless i'm missing something, this SOUNDS right to me. he's assigned them elsewhere...to a non-profit in this instance. so they wouldn't show up on a personal financial statement, even. how is that a "tie" to Halliburton...it's an option earned...and assigned. right?? am i missing something??
