Hilarious. MGIC CEO Curt Culver trembles at the prospect of shelling out more money for sick days should the sick day referendum pass on Tuesday:
Some employers argue that the referendum would add expenses that they'd have difficulty recovering through customers, especially in a shaky economy.
In a letter to Mayor Tom Barrett, Curt Culver, chairman and chief executive of MGIC Investment Corp., estimated that the ordinance would cost his company another $1.8 million in addition to the $562,000 it already spends on sick leave pay for its Milwaukee employees.
Please remember the $1.8 million is almost surely an unrealistic doomsday scenario in which every eligible employee takes off the maximum number of sick days. That just doesn't happen in the real world. (The Brawler believes that because that's how businesses always frame these things.)
But losing $2 billion as a result of his decision to dive into insuring subpremium mortgages and other risky loans? He'd do it all over again!
The chief executive of MGIC Investment Corp., the nation's biggest private mortgage insurance company, offers no apologies for his company's decision to insure billions of dollars worth of subprime mortgages and other high-risk loans during the past decade, a decision that in retrospect seems to have been one of many contributors to the subprime mortgage crisis.
"We should have done more," he said in a recent interview. "It was a money-making machine for the company."
But when that machine broke down, it left MGIC awash in red ink, with a loss of nearly $1.7 billion in 2007 - virtually wiping out its combined profits from the three previous years. It has lost $245.6 million so far in 2008.
MGIC is worth $6 billion less today than it was at the end of 2004, as the company's shares plummeted from the $70s to $3.88 at the close of trading Friday. Its market value has fallen from $6.6 billion to $485 million.
And how has MGIC punished Culver for destroying billions in shareholder value? By paying him $3.45 million in 2007. That's equal to almost two years worth of sick time for all employees under his doomsday scenario.