It’s almost unbelievable to me and many others that CSX stockholders would go along with Hunter Harrison’s financial demands - God’s gift to railroading - and “work from home” on top of that. He reminds me of the 19th century robber barons such as Jay Gould and Jim Fiske. Just different century. An outsider might define this as pure extortion. A good manager could do the same job at a third of the salary. Even the basic salary of the president of the United States is only $400,000 and certainly is a much more responsible position than running a railroad. Give a break! Poor guy would starve to death in retirement if he didn’t get the $80 million in retirement benefits he claimed CP Rail refused to pay him. At least they have common sense. I was on the verge of purchasing some CSX stock, but not as long as such lunacy is being practiced. Keith Creel has been very busy picking up the pieces in the wake of Harrison’s departure. Could essentially the same thing occur after Harrison has raped CSX?
Am glad that somebody out there is seeing this overzealous lunatic for who he is.
Those that voted for EHH do not care about the railroad or its ability to sustainably operate. They only care about this quarters stock appreciation and dividends. They will dump the stock in less than a heartbeat if appreciation and dividends are challenged. EHH's mission is to loot the cash from operating income and give it to the stockholder - stockholders that have no on going concern for the ability of the company to succesfully operate with a lack of working capital.
Never too old to have a happy childhood!
Solomon It’s almost unbelievable to me and many others that CSX stockholders would go along with Hunter Harrison’s financial demands - God’s gift to railroading - and “work from home” on top of that. He reminds me of the 19th century robber barons such as Jay Gould and Jim Fiske. Just different century. An outsider might define this as pure extortion. A good manager could do the same job at a third of the salary. Even the basic salary of the president of the United States is only $400,000 and certainly is a much more responsible position than running a railroad. Give a break! Poor guy would starve to death in retirement if he didn’t get the $80 million in retirement benefits he claimed CP Rail refused to pay him. At least they have common sense. I was on the verge of purchasing some CSX stock, but not as long as such lunacy is being practiced. Keith Creel has been very busy picking up the pieces in the wake of Harrison’s departure. Could essentially the same thing occur after Harrison has raped CSX?
Welcome to 21st Century vulture capitalism!
C&NW, CA&E, MILW, CGW and IC fan
The last time Capitalism came under serious attack was in the '70's when inflation was out of control...the answer was high interest rates to stop it in it's tracks followed by the start of "Globalization" to ease upward wage pressure. Since then many jobs have been lost, the rust belt, factories closed, everything changed. We have made tremendous gains in productivity but by far it only benefits the 1%. In fact most folks have taken on massive debt just to stay even. It has become an insiders game, both politically and economically.
They tell us things have never been better but that is not the way many ordinary people see it. The good folk of Sunderland and Pennsylvania did not see it that way either and that explains Brexit and Trump. The insiders in Washington D.C. and London simply cannot believe it.
EHH is an insider and part of the !%. They genuinely believe they are doing the right thing and are so out of touch with folks that they haven't a clue. There will be more reaction from the good folks.
It sounds to me like we need more regulations on capitalism to prevent it from going vulture. Maybe a non-profit business model would work.
I haver nothing against EHH, but his playbook is no big secret. It's not as if he's figured out how to do cold fusion on the kitchen stove... I guess there is alot to be said for "branding". He's his own personal brand, and evidently people are willing to pay top dollar for it.
Euclid It sounds to me like we need more regulations on capitalism to prevent it from going vulture. Maybe a non-profit business model would work.
Those who are greedy will simply find another way to satisfy their lust. In many cases, they are just gamblers. For them, CSXT is just another market symbol. When it quits paying out, they'll move on to the next game.
And regulations generally have a good side and a bad side in the end. All too often the bad side is far worse than any good the good side provided.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
Regulations presuppose that the people who do the regulating are more capable and honest than those who are being regulated. To me the free hand of supply and demand is a better arbiter than an appointed/elected government official. If EHH is a bad choice then the shareholders who voted to bring him on board will pay the price.. and if he does a good job then the shareholders will reap the rewards. That's the way it works.. not so bad..
Ulrich If EHH is a bad choice then the shareholders who voted to bring him on board will pay the price..
as well as employees, shippers, communities that reap the benefits of CSX, and probaly some others. CSX doesn't operate in a vacuum.
Also that whole means justifying the ends thing.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.
The purpose of a company is to make as much money as possible. Maybe somebody can provide a clear explanation of where this becomes greedy.
The dictionary defines greed thusly:
“A selfish and excessive desire for more of something (such as money) than is needed motivated by naked ambition and greed.”
The key element is wanting more than is needed. The problem is that there is no way to define what is needed. All that one has can be lost in a heartbeat, so there is always the need to have more to make up for a possible future loss.
But even greed cannot solve this problem of potential future loss. It is a risk that is a fundamental condition of life. So most people give up trying to completely solve the problem and just roll the dice. To them, the people who try harder might seem greedy.
Notice that even the dictionary is uncertain about where ambition becomes greed, so they say it is when ambition gets naked. We all know now bad that can be.
That's the problem.. we're all looking out for number ONE, but none of us can agree on who that is. I think its me.. you think its you.. Bill thinks its Bill.. and Jane thinks its Jane. See?.. no consensus at all. So if I make out good on a transaction then I'm a smart businessmen.. but if YOU make out well then you're greedy and should be regulated. One of my customers (with a straight face) told me that I should be happy with a $25.00 profit on a one thousand mile trucking haul.. Of course HE should make $1000.00 minimum on whatever he does.. no $25.00 for him because what his co. offers the world (corregated cardboard) is immensely important. So there's no such thing as greed really.. the market keeps us all in check..
Ulrich- That is the way it is supposed to work but not when it becomes an insiders game and it becomes a rigged system...then it does not work. Eventually it will collapse, usually by violent upheaval. Lets hope we have enough brains, fairmindedness and common sense to avoid this.
I see greed as typically being a charge made against someone as an expression of envy. When greed is defined as excessive desire for possessions, it is usually the envious who decide what is excessive.
UlrichIf EHH is a bad choice then the shareholders who voted to bring him on board will pay the price.. and if he does a good job then the shareholders will reap the rewards.
My take - the shareholders (gamblers) who voted EHH in will cash out when it looks like they can get the most they're going to get. Then they won't be shareholders any more and won't care what happens to CSX (or whatever company is getting so raided). They will simply move on to their next target.
In the meantime, those poor schmucks who bought CSX (or whatever) as a long term investment - maybe for their retirement - will take a washing when things fall apart.
Euc - in this case, I would opine that greedy is the appropriate description of those folks who are looking for a quick buck, as opposed to those who are looking for a safe place to park their money and experience some growth. As I noted above - the fact that half of your retirement funds just vanished into thin air when CSX stock took a nosedive (when the reality of EHH's actions finally assert themselves) is of no consequence to them. They got their money...
Share price might not take a nose dive..look a the positive, over the long term price might go up as it has in the past.
zugmann Ulrich If EHH is a bad choice then the shareholders who voted to bring him on board will pay the price.. as well as employees, shippers, communities that reap the benefits of CSX, and probaly some others. CSX doesn't operate in a vacuum. Also that whole means justifying the ends thing.
True enough.. other stakeholders involved who could be harmed or who could benefit by the new leadership at CSX. My uneducated guess however would be that in five or ten years from now there will be a CSX that employs people who pay taxes and contribute to the communities they run through. Will it be a better company than it is today? In some ways probably yes, in other ways maybe not so much..
Greed when it comes to a EHH being lead around by a nose ring by the desires of the Mantle Ridge hedge fund is self evident. Mantle Ridge got their position in CSX to be able to loot the treasury and whatever other assets they can convert into cash now. They intend to be gone when the true results of their actions really affect the property and need the cash that is no longer in the company to run the company effectively and profitably.
Well, the only way the long term investor loses is if CSX goes out of business.. and I don't think that's likely to happen. If you're wrong, CSX will be a better company in five years from now, and the price of the stock will appreciate to reflect that. And if you're right, the price of CSX stock may plummet temporarily, to penny stock status even, at which point it becomes a great buying opportunity. With stocks generally overpriced now we're about due for some deals.
Just got the new issue of Trains. Mr. Frailey opines that EHH isn't a bad thing for CSX.
I have no doubt that CSX has room for improvement - pretty much any organization does.
The question is whether EHH's methods are the proper route to those improvements.
As of just now, CSX stock is down .07 - probably a minor fluctuation. I don't track the market.
The issue with CSX stock becoming a "penny stock" is if that makes up a significant portion of someone's investment and they don't "play the market," as they consider their stock a long term investment. It's small consolation that it will rise again if the stock drops to 10% of its current value about the time they had planned to cash in and retire...
I noted in Fred Frailey's EHH love fest he noted how CSX has started turning around in just EHH's first 10 weeks. I read in Railway Age a couple of railroad analysts/contributors feel those better numbers during that period reflected more to some changes CSX made before EHH arrived. Even so, they think he will still be a benefit to CSX.
Mr. F stated in his article, "Try as I might, I cannot equate poor customer service with faster trains spending less times in terminals and arriving on time almost every day." Well, the trains may be moving over the road and into the terminals better, but are cars getting switched to the customers? A person on another website commented on how CSX was cutting out all overtime. He stated (take it for what it's worth, there's really no way to prove his statement) that in his area one day they (what I took to be all the industrial switch jobs in his terminal) had to bypass a total of 9 customers, including an automobile plant of some sort, one day.
Who knows, maybe 8 of those 9 customers they don't want anyway. Their business probably just gets in the way of all that other more lucrative business they don't have yet. Just keep squeezing more out of what's left. Get rid of what you don't need today and to heck with tomorrow.
Jeff
Jeff, do you remember in The Treasury of Railroad Folklore the account of what it cost a railroad when all overtime was cut out?--a car of Kosher meat was not delivered tuntilthe next day--and the railroad had to pay to have it washed again?
Johnny
Deggesty Jeff, do you remember in The Treasury of Railroad Folklore the account of what it cost a railroad when all overtime was cut out?--a car of Kosher meat was not delivered tuntilthe next day--and the railroad had to pay to have it washed again?
Remember it well.
jeffhergert Deggesty Jeff, do you remember in The Treasury of Railroad Folklore the account of what it cost a railroad when all overtime was cut out?--a car of Kosher meat was not delivered tuntilthe next day--and the railroad had to pay to have it washed again? Remember it well. Jeff
There are numerous examples in every form of human activity where 'strict avoidance' of penalties cost far more than whatever the penalty would have been.
One division on my carrier came down hard on 'held away from home terminal' payments. (Employees go on pay after 16 hours at their away from home terminal - paid on the minute basis.) Their overall Crew Balancing cost skyrocketed. It costs money to call a crew, get them transported to the away from home terminal and to lodge them at the away from home terminal - all to prevent paying crews that are already in place a few hours of 'Held Away' time.
Be careful of what you ask for - YOU MAY GET IT!
I would say that anyone who is not familiar with all that the operation entails--and refuses to listen to another employee who knows more about the situation--is apt to cost the company more money than he thinks he is saving the company.
This can apply to anyone from a weed weasel to the chief executive.
Deggesty I would say that anyone who is not familiar with all that the operation entails--and refuses to listen to another employee who knows more about the situation--is apt to cost the company more money than he thinks he is saving the company. This can apply to anyone from a weed weasel to the chief executive.
I concur..it always pays to listen to the people who are actually doing the work.. they know more about it than anyone else does.
My two cents as a former CSX stockholder:
First, I will never buy the stock again because I lost a lot of money in opportunities lost elsewhere while the stock stagnated in value while "experienced" railroaders were running the show and all I heard on the investors call each quarter was lame excuses.
Second, I don't think EHH will be as successful at CSX as he has at other Western carriers. Primarily because CSX has a shorter haul.........we'll see though.
Third, regardless of EHH I think CSX stock and company will survive as they initiated a few decent programs prior to his arrival. Expanding tunnel clearances in the East for Double Stacks was a good idea. Investing into Louisville and Indiana, as a potential gateway route was another good move. Both projects are taking too long but they were both good ideas. I read the Trains article and have no clue on hump yard costs but I do know that keeping the cars moving is a better idea than parking them in a classification yard. Use the classification yards only when you have to is a good approach and/or for paid storage in transit schemes. Really is a mystery to me why across the river from Louisville that the Louisville and Indiana can have a profitable stored in transit yard setup for a plastics customer but CSX just across the river doesn't seem to have any...........marketing weakness there on the part of CSX, IMHO.
Still bullish on UP RR and expanding ownership of it's stock, I think eventually it will out compete BNSF. UP RR seems to be a lot more saavy where it spends it's money on investments and also has the Public Relations and Marketing areas down better than any other railroad in the U.S. Also, note UP was never on EHH radar's list of railroads to improve. Pretty sure UP management would have drop kicked EHH out the door.
My guess is the storage in transit yards (L&I) is much more efficiently run by a smaller company than the large class 1....and the business is much more attractive.
It sounds as if the L&I will become a very important piece of railroad in the years ahead. It is seeing quite a few more trains than before. Perhaps at some point intime a Louisville to Indy Amtrak would make sense to connect to Chicago.
Ed
MP173Perhaps at some point intime a Louisville to Indy Amtrak would make sense to connect to Chicago.
I thought the same but surprisingly they are only upgrading the tracks to 49 mph I read somewhere or maybe I saw that on youtube. Also, what would it take to reach the L&I track from the Indy Amtrak Station. Youtube videos show Indy track as fairly slow and I think the article said CSX rebuild program starts like 2 miles out of the city limits.
BaltACD jeffhergert Deggesty Jeff, do you remember in The Treasury of Railroad Folklore the account of what it cost a railroad when all overtime was cut out?--a car of Kosher meat was not delivered tuntilthe next day--and the railroad had to pay to have it washed again? Remember it well. Jeff There are numerous examples in every form of human activity where 'strict avoidance' of penalties cost far more than whatever the penalty would have been. One division on my carrier came down hard on 'held away from home terminal' payments. (Employees go on pay after 16 hours at their away from home terminal - paid on the minute basis.) Their overall Crew Balancing cost skyrocketed. It costs money to call a crew, get them transported to the away from home terminal and to lodge them at the away from home terminal - all to prevent paying crews that are already in place a few hours of 'Held Away' time. Be careful of what you ask for - YOU MAY GET IT!
We in the OTR industry call what your talking about the Clusterfouled principle. I made it UA safe for a reason. If you think your regs are bad try dealing with some of the crap I have to deal with on a regular basis that even experienced DOT officers go just who in the hell wrote some of these suckers. I had an inspector go well the book says your doing this illegal he was saying on how we run our paperless logs without a paper backup now. Yet the current regulation is if your running a Elog no more paper logbooks are required. Yet in the FMCSA regulations it states only Paper logbooks are acceptable for record keeping. Yet by the end of this year only Elogs are going to be allowed unless your truck is older than a 1999 model. So just how in the hell am I supposed to comply with the regulation that states I have to have paper copies of all the original logs of my drivers when we no longer have the paper books that they used. Just the joys of my field sometimes.
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