(Corrects to delete nationality in fourth paragraph.)

Nov. 15 (Bloomberg) -- I don't know about you, but I'm finding this latest upheaval in the financial markets a bit disheartening.

The $45 billion is one thing; the losses we can all accept. (After all, it's mostly other people's money.) It's the lack of personal ambition that's hard to forgive. There was a time when bankers and traders at big Wall Street firms knew how to exploit a boss's weakness. The moment the head of a Wall Street chief executive officer rolled, a dozen subordinates lined up to kick it into the net.

No longer. The CEOs of two giant Wall Street firms have been axed, a third is one big subprime writedown away from oblivion, and a fourth is apparently scouring his firm for his successor. And there's hardly anyone to replace them!

The situation is so dire that, in its panic to find even an interim CEO, Citigroup phoned up Win Bischoff, a 66-year-old executive no one had ever heard of, didn't much want the job and, before he took it, had to ask permission from his wife. Actually, it's worse than that.

The situation is so dire that Todd Thomson, fired by Citigroup's CEO Charles Prince for flying privately once too often with CNBC news anchor Maria Bartiromo, treated the demise of the man who fired him not as a path back to power but an excuse to bitch and moan in the newspapers that he'd been mistreated. Boo Hoo!

As I say, disheartening. The size of the pathos on Wall Street, and the huevos, had me feeling low.

That's when I realized: Anyone can be a critic. I can sit here at my computer and complain about all that's missing from the world, but my words won't fill the void. Only my actions might make a difference. But then something else came to me. Before I can responsibly accept the job as Citigroup CEO or even at Bear Stearns, I needed to ask myself: Am I really qualified?

Well Qualified

And so I did. This led to several seconds of sometimes painful introspection. But once they'd passed I had both my answer (Yes!) and another, even better question: What, exactly, are the qualifications of a Wall Street CEO? Clearly, the boards of directors who hire them don't know, as they keep having to fire them. The qualities and attitudes and skills necessary for the job must be inferred, from the CEOs themselves. Examine these special people closely and you can see why they are so hard to replace. To wit:

-- The Wall Street CEO must possess an extraordinary ability to be paid huge sums of money each year without losing composure.

This isn't as easy as it sounds, especially when the firm is losing billions. Imagine if some board handed you $40 million or so a year (before benefits) and tossed in a nine-figure severance package. If you're like most people, you'd dance around the kitchen naked with the drapes wide open -- until you realized what people who raised you would say when they read about it in the paper.

Whereupon, you'd return to the board and tell them that really, it wasn't fair to the other people in the firm, or the shareholders -- and that you'd prefer to be paid a more reasonable sum.

Already you can see why most people are ill-equipped to be Wall Street CEOs: They aren't prepared to turn their back on old- fashioned ``morals.'' But as CEO you must. The second you signal anything less than fanatical self-interest you undermine your own authority, especially with the rank and file. After all, if you can't even maximize your own paycheck, how on earth are you going to maximize theirs?

-- The Wall Street CEO must quickly see where his interests, and those of his most ambitious underlings, differ from those of his shareholders. He must then navigate a tricky course: maximizing his own interests, and the interests of his most ambitious -- and thus to him most dangerous -- underlings, without attracting shareholders' attention.

Gamble and Win

Just now that means gambling big time with shareholders' capital. If the gamble pays off, the CEO and his underlings take home giant bonuses at the end of the year. If the gamble fails, the CEO takes home his nine-figure severance package and five years use of the corporate jet.

His underlings move up in the firm, or get reassigned, or leave and join other firms -- where, if they're working for a CEO who knows the game, they get to make the gamble all over again. Sooner or later, it's going to pay.

Put that way it sounds easy. But you try it sometime. If you're like most people you wouldn't have the stomach for the job. You'd stay up all night wondering how the shareholders are going to feel if the gamble fails. You'd experience guilt, and other counterproductive emotions, especially as losses mounted to record levels.

No Successors

-- The CEO must organize his subordinates so thoroughly that, when the end comes, as it must, no one is really qualified to replace him.

It's hard to control and limit so many seriously ambitious people but if you are up to the task you solve several problems at once. First, you minimize the damaging information about you in the press: If nobody suspects he can replace you, nobody stands to win big by leaking nasty facts about you. Second, it's easier to gamble big time with the firm's capital -- betting the ranch on subprime mortgages, for instance -- as the board won't be able even to think of a name of an employee with the stature to second-guess your decisions. (And why should they?)

Finally, the absence of a potential CEO in your firm compels the board to pay you even more money to keep you happy. (And you're a hard man to please!) This welcome addition to your compensation reinforces your status within the firm, and reminds everyone of your ability to maximize your narrow self-interest. Which, as we have seen, is the first requirement to running one of these large financial organizations.

Having never actually run an organization larger than a softball team for 8-year-old girls, I can't prove to you before you give me a chance that I'll do it well. But I promise you this. Once I'm in charge of your firm -- be it Citigroup or even Bear Stearns -- the moment anyone beneath me exhibits the capacity to act and think for himself, I'll do whatever is necessary to help him to leave and start his own hedge fund. That's just the kind of leader I am.

(Michael Lewis is the author, most recently of ``The Blind Side,'' and is a columnist for Bloomberg News. The views expressed are his own.)

To contact the writer of this column: Michael Lewis at mlewis1@bloomberg.net.

Last Updated: November 15, 2007 09:03 EST