Stock Market Update - Thu Nov 15 08:18:51 EST 2007

Merrill Lynch (MER 57.98), which has been battered by embarrassing reports detailing its credit losses and poor risk management, is finally getting some good press again.  The catalyst for the change has been the firm's announcement that it has tapped John Thain to be its new CEO.

Mr. Thain, of course, was the head of NYSE Euronext (NYX 86.74) who received high praise for making the NYSE more competitive and more efficient from an operational standpoint.

Thain is generally regarded as a savvy operational guy and risk manager, which is exactly what Merrill Lynch needs following its recent debacle.  More importantly perhaps, given the root of its recent troubles, Mr. Thain has experience as a mortgage bond trader and actually ran the mortgage desk for Goldman Sachs from 1985 to 1990.

Various press reports have harped on the claim that Mr. Thain doesn't have a very lively personality, something that is regarded by many as a pre-requisite for a CEO of a major investment bank given all of the deal-making that takes place.  That may be true, but to Mr. Thain's credit, he wouldn't have risen to the level he rose to at Goldman Sachs and the NYSE if he was a complete bump on a log.

Rest assured, if Thain succeeds in getting Merrill turned around in his conservative style, and the stock price rebounds and employee bonuses increase, no one will care that Mr. Thain keeps both a stiff upper and lower lip.

--Patrick J. O'Hare, Briefing.com