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US Senate and Congress have stopped Cisco CEO John Chambers from totally wasting Cisco's $44 billion in cash

It's my opinion that Cisco shareholders need to guard their cash from being spent by Cisco CEO John Chambers!

Fri, 1/13/12 - 1:28pm    View comments

Lets face it, according to the December 7, 2011 shareholder/analyst conference call, Cisco CEO John Chambers wants to spend his shareholders' $44 billion in cash.

So what's stopping the highflying Chambers from spending and totally wasting all of his shareholders' loot?

Why, it's none other than the US Senate and Congress. Luckily for Cisco shareholders, your elected legislators that you voted for have not bought into Chambers' tax repatriation bunk!

On October 22, 2004 President George W. Bush signed into law Chambers' last tax repatriation request, the American Jobs Creation Act of 2004.

On that day, Cisco's stock price closed at $18.27. Yesterday, Cisco's stock price closed at $19.15, not exactly the kind of investment return Cisco shareholders were expecting from Chambers' 2004 tax repatriation windfall.

Naturally as expected, Chambers has been spending Cisco shareholder cash to make himself wealthy, and there's certainly nothing wrong with that as long as his shareholders are getting wealthy too, but unfortunately for them, they're not.

John Chambers has also been able to increase his dinner party, cocktail reception and lawn party invites by making various technology entrepreneurs and their respective venture capital backers wealthy too, but once again, Cisco shareholders have not be able to participate in all of this wealth created by Chambers' spending Cisco shareholder cash.

Interestingly, during the December 7 conference call, Chambers implied that Cisco shareholders would be rewarded with an increased dividend should they work hard at lobbying their representatives in the US Senate and Congress to pass tax repatriation.

Curiously though, Chambers recently sold 1.5 million shares (i.e. $28.4 million) of his Cisco stock, now does that sound like a CEO who's planning on making a meaningful dividend increase?
 

What's your take?

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