Memos from the Chairman

This is a collection of the internal memos Alan Greenberg wrote to Bear Stearns employees while he was chairman, from 1978 through the mid-1990s. They are short, most under a page, and they were circulated to everyone in the firm.

The recurring subjects are cost control, hiring and personal conduct. Greenberg pushed relentlessly on expenses, including a famous instruction about reusing paper clips and rubber bands, and the point was not the money saved but the signal that no expense was beneath examination. He instructed that employees should hire people with what he called PSD degrees, meaning poor, smart and a deep desire to become rich, and he was explicit that credentials were not what he wanted. He required that all bad news reach him immediately and made clear that concealing a problem was the one unforgivable act. He set a rule that every senior employee must give four percent of pre-tax income to charity, and enforced it.

Many of the memos quote a fictional sage, Haimchinkel Malintz Anaynikal, whom Greenberg invented so that he could deliver instruction as maxim rather than as order. The book takes an hour to read and functions as a short course in how a firm's culture is transmitted by repeated specific written communication rather than by values statements. The obvious complication is that Bear Stearns failed in 2008, a decade after these memos, and readers should think about which of Greenberg's practices survived his tenure and which did not. The collection has no analysis and no context beyond brief introductions.