Customer Reviews

Sudden Death

5 star:		(0)
4 star:		(1)
3 star:		(1)
2 star:		(0)
1 star:		(1)

 

 

A nice story about the decline of one of America's leading brokerage houses. If it weren't for the arrogance of Bob Fomon, this venerable firm might still be around. Other personalities-Rittereiser and Pierce were also rsponsible for the death of this firm. It just goes to show that power corrupts and total power absolutely corrupts. I wonder how many Bob Fomons are out there in the rest of the large companies of this world. Probably quite a lot.

The book details the founding of this firm by E. F. Hutton, and the subsequent leadership. The first fifty pages are the history of the firm, with the remaining two hundred pages detailing the rule of King Fomon, and the power plays between various players in the brokerage house. These internal power struggles ultimately weakened the firm, so that it took its eye off its customers. Ultimately, the firm was taken over by Shearson, a subsidiary of American Express. A nice read on the trevails of poor leadership.

Robert Fomon was my grandfather, I dont understand this mans bias against a man he didnt know. My grandfather died when I was in 3rd grade, and this is not how I hoped he would be remembered. Despite the mishappenings dealing with EF HUTTON, I would appreciate all those to refrain from posting rude messages on the morals of my grandfather, for the same reason I would not critisize a family member of yours who I knew nothing about.

E.F. Hutton reminds one a lot of Enron, as a company in a rather stable and profitable business (i.e. a brokerage and natural gas) goes into risky business they don't have any real expertise in because it has more prestige. (both move into trading). Both had executives incapable of steering the company back into profitability, Enron's because of dishonesty and Hutton due to incompetence. But most likely the major reason for Hutton's fall is the simple fact that it was unable to change as the market did. When this finally caught up to it, the only thing to do was to sell out at a bargain basement price.

One reason that I can only give this three stars is that author seems to have a grudge against the company, especially Bob Forman, that comes out in the language used. Such when Forman breaks his leg, he's described as "crawling on his soft, flabby gut" There are other examples that cause the reader to sometimes wonder if this a hatchet job.