We interrupt this recession to bring you the NCAA Sweet 16 and party like it's 1999. Welcome back to $6 beers, $200 hotel rooms, no-vacancies, and a 30-minute wait for a table. Thank you Ty Lawson, Blake Griffin, Jonny Flynn, Josh Heytvelt, and especially Roburt Sallie, who singlehandedly kept this tournament from being a bummer.
Since we're revaluing everything from houses to newspapers to 401(k)s these days, let's take a look at who's worth what in big-time college and professional sports. And no wisecracks about them being the same thing.
Just as it is possible to be overfed, overpaid, and overnewsed, the Memphis riverfront is overparked. And Mud Island River Park, now 27 years old, could be the odd man out on Old Man River, at least in its present form.
A land-use study of the park will get under way next week with public hearings March 23rd and 24th. The Riverfront Development Corporation and Memphis City Council discussed Mud Island's cost and future in meetings this week. With $30 million Beale Street Landing soon to become the big new thing on the riverfront, the council may be reluctant to spend much money on Mud Island, except for a new playground.
"Indeed, Mud Island River Park is unique and special, but an entertainment and amusement facility it isn't," wrote RDC president Benny Lendermon in a letter to City Council chairman Myron Lowery last week.
When it opened, after nearly a decade of planning and at a cost of some $60 million, Mud Island supposedly drew a million visitors in its first year. If so, that included thousands of school children hauled over to see it on field trips. There were three restaurants, a popular outdoor amphitheater, a monorail, the river model and museum, and gorgeous river views.
But there were critics, too, like then-councilman J.O. Patterson Jr., who favored a theme park and predicted, correctly, that a park based on history would not attract crowds year after year. A newspaper columnist named Paul Turner put in words what many Memphians were thinking: After one visit, why would you go back? There was no bridge to Mud Island for five more years, and there is still no pedestrian bridge from Beale Street or the cobblestones. And the name "Mud" became something of a joke despite the creative efforts of advertising man John Malmo.
Pyramid promoter Sidney Shlenker took it over for a couple of years in the 1990s, opening the river model to swimming and tearing down a playground at the north edge of the park for no good reason. The RDC has managed and promoted it since 2001 and eliminated park admission fees, brought back the concerts, and done an exemplary job of landscaping. Tbe flowering shrubs and hardwood trees have matured, and the park is shadier, prettier, cheaper, more user-friendly, and easier to get to than it was when it opened. One of the coolest ways to see it is by bicycle, either by pumping over the steep Auction Street Bridge or via the sidewalk above the monorail and then down the elevator.
But Mud Island River Park has lost its niche as well as its charm in 27 years. Tom Lee Park was expanded and is being expanded again for Beale Street Landing. Confederate Park on Front Street will get more attention when the University of Memphis law school moves into the old Customs House. The Greenbelt Park across from Harbor Town is the choice of most dog-walkers, joggers, walkers, boaters, and bikers — and it doesn't close in fall and winter. The cobblestones sidewalk is closer. The bluff walk has better views. Soulsville and the Memphis Rock 'n' Soul Museum next to FedExForum have better music exhibits. Overton Park's shell has free concerts. Shelby Farms is undergoing a multi-million dollar upgrade. Tunica has a newer river museum. And if Lendermon and the RDC catch a break and the economy turns around, Beale Street Landing could eventually have a real riverboat to go with the model in the Mud Island River Park museum.
So it's the right time to rethink Mud Island River Park. Compromise should be one of the guiding principles.
It goes against the grain of the RDC, which tends to overspend on big projects and consultants, but inexpensive, common-sense improvements to Mud Island River Park — a playground and more accessible boat ramp, for example — could maintain or slightly increase its 165,000 annual visitors.
And it goes against the grain of Friends for Our Riverfront, which tends to look askance at the RDC and anything that reduces parkland, but taxpayers can't afford to maintain all these parks — from the riverfront to the other 300 square miles of Memphis.
If a hotel operator or developer can be found, it's time to take a hard look at putting a commercial property on Mud Island. Somebody has to pay for all these public improvements, and with the land bridge off the table and the Front Street promenade apparently tied up in court indefinitely, the most obvious candidate is on the west side of the harbor.
Bankers and brokers at Memphis banks should be able to make ends meet for another year of the recession, thanks to compensation packages disclosed last week.
Birmingham-based Regions Financial, which got $3.5 billion in the U.S. Treasury bank bailout, was especially generous, even though its stock price has fallen from $35 in 2006 to $3.20 this week.
According to the proxy statement made public recently, Regions president and CEO C. Dowd Ritter received total compensation of $9,261,865 in 2008. In 2007, he earned $7,713,138. In 2006, he earned $18,433,987. His three-year haul: $35,408,990.
Ritter is eligible for retirement. For better or worse, he didn't. Had he retired at the end of 2008, his annual benefit would be $2,311,118, according to the proxy.
The highest-paid Regions employee for 2008 was Memphian Douglas Edwards, former CEO of Morgan Keegan, a profitable division of Regions since being acquired in 2000. Edwards left Regions in 2008. His total 2008 compensation, some of which was dictated by prior agreements with Morgan Keegan, was $10,085,834.
Over at Atlanta-based SunTrust Bank, CEO James M. Wells III earned a total compensation of $5,450,214 in 2008. His three-year haul: $15,026,578. SunTrust got $4.9 billion in the bailout. Its stock price has fallen from $84 in 2006 to $11 this week.
Memphis-based First Horizon National, parent of First Tennessee Bank, had not released its 2009 proxy at press time.
The full proxy statements — wordy but still the most bang for the buck in the whole realm of financial disclosure — can be viewed on the companies' websites. Compensation is approved by a committee of outside board members who are paid $80,000 to $100,000 a year for their wisdom and trouble.
Regions went on a buying spree 10 years ago, acquiring Morgan Keegan in 2000, Union Planters Bank in 2004, and AmSouth Bank in 2006. Someone thought bigger was better, and it was for a few top executives. Jackson Moore, former CEO of Union Planters, who retired at the end of 2007, earned $12,290,451 in 2007 and $29,190,349 in 2006. But now Regions is just a big butt-ugly bank trying to survive and get its stock price up above $5 a share.
The bailout — technically the American Reinvestment and Recovery Act of 2009 — is supposed to impose limits on executive compensation, so for banks it's a matter of getting it while the getting is good.
From the Regions proxy: "At this time, the compensation standards under ARRA have not yet been developed. However, we expect the standards will require a substantial alteration to our compensation program."
Or, as the bank robbers said in the old television westerns, "Hurry up and grab that cash, boys. The sheriff's comin'!"
Meanwhile, there's another heist planned for 2009.
This note from the Regions compensation committee:
"As a result of the reduction in 2008 annual bonuses and the operation of long-term plans, the compensation committee determined to award additional equity opportunities in 2009 to our senior management to provide them with the opportunity to benefit appropriately from our long-term performance."
What this means in plain English is that the top dogs are getting fresh stock options that, in contrast to the ones they earned previously, could actually be worth something in a year or two because the "strike price," or price at which the option can be exercised, will be around $4 or $5 instead of $30 or more. When a stock is priced at $3, it is worth 33 percent more if the price rises $1 to $4 per share. Such price moves are not uncommon when stock prices fall below $5 a share.
Bottom line: C. Dowd Ritter and the gang could be sitting pretty by the end of the year, while ordinary shareholders wait for Regions to climb back to $25 or $35 a share.
Move over, John Grisham. Once again, the real news from a small town in Mississippi is better than fiction.
First there was Bernie Ebbers of Brookhaven, the builder of WorldCom, the telecom bomb, who is now serving 25 years in federal prison for financial fraud. Then there was Richard "Dickie" Scruggs of Pascagoula and Oxford, the lawyer who successfully sued Big Tobacco and was sent to federal prison last year for conspiring to bribe a judge.
Now comes James M. Davis of Dry Creek, the chief financial officer of Stanford Financial Group, who, along with Allen Stanford, was accused by the Securities and Exchange Commission of executing "a massive Ponzi scheme" valued at $8 billion. The SEC says Davis' 35-year-old protégée, Laura Pendergest-Holt of Baldwyn, facilitated the fraudulent scheme.
In The Bonfire of the Vanities, Tom Wolfe popularized the phrase Masters of the Universe. As he wrote in a column in The New York Times last year, "The Masters of the Universe is a phrase from that book referring to ambitious young men (there were no women) who, starting with the 1980s, began racking up millions every year — millions! — in performance bonuses at investment banks."
Pendergest-Holt worked part of the time in Memphis, gave financial advice on local radio stations, and earned $1 million in both 2007 and 2008. At Stanford Financial, she was a Mistress of the Universe. No glass ceiling for her; she was named to the investment committee when she was 31 and given the title chief investment officer. There was a corporate jet to take her and Davis from Baldwyn to Houston, Antigua, and Memphis — only 120 miles as the jet flies.
Baldwyn residents described Pendergest-Holt as one of the smartest young women ever to come out of the town. Davis is fifth-generation Dry Creek. He started a church in nearby Guntown. He was an angel investor for Baldwyn's struggling downtown, giving it a touch of Oxford's square, with stores such as Patina Décor, the Status Thimble, Kaffe at the Old Post Office, and Galerie d'Art. The marketing slogan: "Expect the Unexpected in Downtown Baldwyn."
The names, the slogan, the Old English airs ... as the FBI said about Stanford's accounting: Somebody has to be making this up. But the names are real, as was Davis' devotion to Baldwyn, say those who know him well.
"Jim Davis had a deep love and passion for small municipalities and realized that the heart is the downtown area," said Baldwyn mayor Danny Horton. "Everybody in town is kind of shocked. Any news travels fast, but most people, like me, didn't know about it. They probably would know more about the Friday night football games than about the dealings of Stanford."
Business owners and bankers, however, are usually as familiar with finance as they are with football. There are two banks in Baldwyn: Regions and Farmers and Merchants. Stanford's certificates of deposit (CDs) paid twice as much interest as their products. Managers at both banks declined to be interviewed last week.
Downtown Baldwyn would be a sorry sight without Davis' investments — a vacant hardware store, an old movie theater now housing school offices, a vacant Whirlpool electronics store, a vacant drug store with sheets covering the windows. Davis also sank over $2 million into his home on a country road, where there isn't a comparable property within 20 miles.
The FBI and SEC are not buying small-town innocence. They have Pendergest-Holt pegged as a liar with unusual gall. Early in February, at a meeting in Miami, Davis and Allen Stanford admitted to senior employees, including Pendergest-Holt, that they misused investor funds and faked financial statements.
"Incredibly, four days after the Miami meetings, Pendergest-Holt made a two-hour presentation to the [SEC] staff — and subsequently testified under oath — regarding the whereabouts of Stanford's multi-billion dollar investment portfolio," the SEC claims. During those presentations, she denied knowing anything about the status of the bank's assets and said nothing about misappropriated funds.
Davis said this week that he will not cooperate with investigators, lest he say something self-incriminating. Considering what has happened to Pendergest-Holt recently, that was not unexpected.