“Legacy Assets”

Is "legacy" becoming a bad word?

Citigroup CEO Vikram Pandit made me aware of the threat at his first presentation to the Wall Street crowd. Citi, Pandit said, will get rid of $400 billion of "legacy assets."

Citi must have borrowed the term from the IT guys. Software engineers like projects that start with a clean slate. Too often, though, they must wrestle with "legacy assets" – dysfunctional IT stuff that the client considers too expensive to jettison.

For CEO Pandit, "legacy Assets" serves as convenient shorthand for saying, "We didn't acquire these CDOs and SIVs and other junk during my watch." So Citigroup investors should blame the previous CEO, Charlie Prince. Better yet, Sandy Weill.

Will "legacy" acquire enough negatives to endanger the fashion of referring to estate planning as "legacy planning"?

"Legacy planning" is meant to suggest an enhanced form of estate planning – one concerned with passing along "values" as well as money and property. But as the IT guys and Pandit remind us, all that gets passed along isn't necessarily welcome.

There's also the question of whether "values" can be taught to the children of the extremely well off. See yesterday's post on the Wealth Report and the comments thereon.