Thain has been vocal about the need for the NYSE to look more toward electronic trading, but believes that its embattled specialist system is still necessary on the floor of the exchange. Now that he's chief of the exchange, we'll soon see whether he indeed has the will to stare down the powerful specialist system. As we reported yesterday, the SEC found rampant trading abuse at the NYSE, and its proposed overhaul has prompted massive pension fund CalPERS to sue.
Notably, Goldman Sachs, Thain's former employer, owns one of the big specialist firms, along with LaBranche
This week, the NYSE reported that its overhaul includes plans to separate the chairman and CEO offices. John Reed will stay on as non-executive chairman until a replacement is selected. Reed noted today that he had no choice but to appoint a Wall Street insider to the post, noting that the thought of bringing in someone not intimately familiar with what happens on the trading floor was a "non-starter."
Reed also made a point of announcing that Thain's compensation would be fixed at $4 million per year, well below that of his predecessor, Richard Grasso. This is no inconsiderable sum, though it is substantially below what he would have made continuing in his role at Goldman Sachs.