One thing we've noticed recently is that the chorus of dissenting voices inside of Merrill Lynch has quieted in recent months. In the weeks after John Thain replaced Stan O'Neal as chief of Merrill, the securities firm was bitterly riven as executives scrambled for authority (and, of course, money...always money) under the new regime. But by all accounts Merrill is a quieter, happier place these days.

This is a testament to the effectiveness of Thain's leadership. But we wanted to know: how did he do it? After the jump, we explain why we think something Thain said on Wednesday indicates what happened.

At a gathering of Wall Street dealmakers yesterday Merrill Lynch chief executive John Thain said he hopes the Federal Reserve will continue to permit securities firms to borrow from a new Fed facility launched amidst the implosion of Bear Stearns. We couldn't help but notice, however, that Thain seemed a bit worried that the Fed isn't going to keep the window open. To paraphrase a popular saying on Wall Street, "hoping" the Fed window stays open is not a strategy.

"I think it should stay available to the banks and investment banks -- the primary dealers. It's important that it does stay available," Thain said to the audience at the Wall Street Journal dealmakers conference at the posh Pierre Hotel in Manhattan.

It had been widely assumed that the facility would be continued after its scheduled expiration in September. But recently opinions have shifted, with some reading the recent warnings from several Fed officials as indicating the window will be closed. What's more, the investment banking community is said to be split on whether they should have continued access to the window. Goldman Sachs is said to be leaning toward opposing a move to make the borrowing facility permanent, and Lehman is said to support the move. Morgan Stanley reportedly takes a middle position, wanting to wait to see the kind of regulation that would accompany the window.

This is the first time we know of that a securities firm has gone on record with its support of keeping the window open. Thain's decision to take this stance seems to indicate that he is taking seriously the idea that the Fed will not keep the facility open beyond September.

Merrill's Thain Urges Fed To Extend Lending Deadline To Brokers [Dow Jones]

Merrill CEO wants ongoing Fed access, rules reform [Reuters]

Merrill Lynch CEO and amateur beekeeper John Thain’s daughter, Victoria, was robbed last Friday. The thieves apparently entered the Duke junior’s apartment via bedroom window, stole $9,000 worth of stuff including her wallet, camera, and TV, and exited through the front door. Run of the mill burglary or a strategic hit from one of the many enemies daddy’s racked up over the years? The fact that nothing was taken from any of Victoria’s roommates seems to imply the latter. Suspects include: Jon Corzine, Stan O'Neal, bears and vegans, which is to say—Dan Loeb. Either way, she should thank her lucky stars that the phantom defecator couldn't get the funds together for a trip down South.

Earlier: Presented Without Comment

Thief lifts goods from student's apartment [The Chronicle]

"Thain is also a beekeeper, and used to keep hives in the backyard of his Rye, New York, estate...In his time as a beekeeper he was only stung once. 'They don't sting unless you aggravate them,' he says."

Everything about this is so wrong we almost feel guilty just linking to it. Almost.

“I am getting tired, really getting tired, of these golfing cocksuckers.” [2:45]

Earlier: Merrill Lynch Has Made A Terrible Mistake

And we’re back to Thain already.

Not that there was any doubt but it’s now official. Here’s the Merrill Lynch press release announcing that Thain takes the helm on December 1st.

"Merrill Lynch & Co., Inc. (NYSE: MER) today announced that John A. Thain, chief executive officer, director and member of Management Committee of NYSE Euronext, Inc. and former president and chief operating officer of Goldman Sachs Group, has been appointed chairman and chief executive officer of Merrill Lynch, effective December 1," Merrill said in a statement.

Full Press Release after the jump.

It looks like it's Merrill Lynch that is nabbing New York Stock Exchange chief executive John Thain.

The New York Post has just reported that Merrill is expected to announce that it has hired Thain to replace ousted CEO Stan O'Neal sometime this afternoon. Zach Kouwe, whose reporting has scooped the world on this story, attributes it to "people familiar with the matter."

An NYSE board meeting is scheduled for 2 p.m. today and an announcement could come after the market closes, sources said. The move is a huge coup for Merrill and board member Alberto Cribiore, who has led the search for a new CEO after O'Neal resigned on Oct. 30.

Kouwe also reports that Citi wanted Thain but he chose the smaller, more narrowly focussed Merrill instead. The Post describes this as a "snub" for Citi. NYSE Chief Operating Officer Duncan Niederauer is expected to land the top job at the exchange.

Citi Snub: Thain Going To Merrill [New York Post]

Update 12:32: The Wall Street Journal files its report also: "John Thain, CEO of NYSE Euronext, has agreed to take the top post at brokerage house Merrill Lynch & Co., according to a person familiar with the matter."

Update 12:39: Congratulations and thanks to all our readers who voted in this morning's reader poll, which correctly called that John Thain would leave the NYSE for Merrill. We're constantly gratified by the amazing accuracy of our polls, which have predicted everything from the level of Fed rate cuts to this news. We like to think we have the best informed, most intelligent readers but it's nice to see you guys prove it over and over again.

Update 12:50: So what happened to Blackrock chief Larry Fink, the man many thought would eventually be Stan O'Neal replacement? Did he turn the job down? Was the board's enthusiasm for him exaggerated? Some fear of subprime contagion? Loyalty to Blackrock?

Update 1:06: CNBC's Charlie Gasparino says that Fink was offered the job, but he spooked the Merrill board by demanding a full-accounting of Merrill's subprime exposure. This led the board to go in another direction, perhaps out of fear that Fink might turn down the job if the subprime exposure was too bad.

Update 2:01: The Journal confirms that the stock exchange will name
Duncan Niederaueras its new CEO.

Would you believe us (Charlie Gasparino) if we (he) told you that John Thain:

- Had a letter addressed to him from floor trader Kevin M. Flanders that said “Thank U [sic] John Thain for ruining all of our careers?”
- Knows he isn’t well-liked by the trading community
- Once ate a panda
- Was accompanied by a security detail on a recent visit to the floor
- Just wants to dance
- Is “openly mocked for his stiffness”
- “Makes Al Gore look animated”
- Is allergic to bees
- Often finds that his attempts at humor fall flat because, “given his rigid demeanor, traders simply can’t tell whether he’s kidding” or not
- Has a 22" cock

Crunch Time [Trader Monthly]

As most of you probably know, John Thain brushed off the claims of a Goldman analyst today that Reg NMS will “erode the transatlantic stock exchange group’s market share and benefit its main US rival, the Nasdaq.” Tossed them to the wind; knocked them down; scoffed; said, “Whatchu talkin’ about, Willis?” Now, these responses make sense if you’re going to buy the party line that the New York Stock Exchange is, as they say, in compliance with the group of rules known as the Regulation National Market System, and believe the Goldman analyst, Joshua Carter, to be on the right track.

But, as John Francis Carney III has pointed out (like the crazy homeless man who shouts at you when you walk into your building every day) in the past, there’s a good chance that the NYSE isn’t in compliance with Reg NMS. Yes, JFC3 has said, these rules that allegedly help rather than hurt the NYSE—excuse us, NYSE Euronext—are not even being followed by the small elves that push buttons on the corner of Broad and Wall. Or, at the very least, we cannot get any firm confirmation from the NYSE or the SEC that NYSE is in compliance. But why would that be? Why would just John Thain allow this to happen? And why did Erin Burnett show up to the set today walking with a limp? The answers* may surprise you.

We’re not trying to insinuate that FT’s piece on John Thain sounded like it came from The Desk of John Thain or someone as equally into the old boy as, well, the old boy but if you want to glean that, that’s fine by us. If you’re interested in hearing about how great Mr. Thain is but are also the sort of person who values your time, join us after the jump.

We've been having some fun lately at New York Stock Exchange chief executive John Thain's expense. We want to like the guy, we really do. It's just that lately so much of what he's been saying lately is so implausible. Let's do a quick summary of Thain's claims and then rate them as to their likely truth factor.

The Thain claim: The were no problems with the hybrid system.

He was saying this as early as Wednesday, which was our very first cause for doubt. How did they eliminate the possibility of problems the hybrid system that quickly?

Verdict: Doubtful.

The Thain Claim: The NYSE as no plans to eliminate specialists any time soon.

Well, probably not after the specialists saved the exchange on Tuesday afternoon. But just the day before Thain's hand-picked former Goldman Sachs colleague was handed a top executive position at the NYSE, one that many think puts him in line to be the next chief executive of the exchange. And this guy is widely reported to be an enthusiast for 100% electronic trading.

Verdict: Plausible, but only because of Tuesday's glitches.

The Thain Claim: I'm not retiring.

Only John Thain probably knows whether this is true. So we'll give this one to him.

Verdict: Plausible.

The Thain Claim: There is no SEC investigation into Tuesday's glitches.

Thain couldn't have been more blunt about this, denying the existence of any SEC interest in looking into trading problems on Tuesday to reporters and on conference calls with NYSE investors.

From TheStreet.com:

When asked what exactly the SEC was looking into regarding Tuesday's trading problems, Thain quickly answered, "Nothing."

An SEC spokesman said in an emailed response: "Our staff is working closely with the NYSE and other markets to review Tuesday's events to evaluate how orders were handled and whether any enhancements to capacity management appear to be necessary."

The Verdict: Liar, liar, pants on fire.

Summary: We report, you decide, John Thain spins.

As previously noted, John Thain would like the “I–told-you-so” traders who he fired to “quit [their] bitching” and “wipe the smirks of [their] faces” in regard to the events of Tuesday night. Now he also has—we can only assume, as we sometimes do—some unsavory thoughts for those "nabbering-nosey-nancy-boys" fueling rumors he’s looking into early retirement. Though the appointment of Duncan Niederauer to president and co-chair has sent the smell of fish wafting through the NYSE Group, the Thain-meister categorically denied that he will be leaving the company, during a conference call yesterday. He also stuck to his earlier story that the SEC is not investigating The Great Glitch of ’07, his exact response to the question "What's the SEC going to do?" being "Nothing," which scores points for pith but maybe not for accuracy, a pill (or crock of s***) that Charlie Gasparino, during a spot on CNBC yesterday, seemed to find difficult to swallow, as he’d been told otherwise by sources close to the matter. Perhaps Thain is simply embracing the platitude of his favorite TV character and moral compass in all things work-related, G. Constanza, who once wisely noted, “It’s not a lie if you believe it.” Can't argue with that.

NYSE in the Hot Seat [thestreet.com]
CNBC's Gasparino: SEC Looks at NYSE's Handling of Trading [CNBC]
As Rumors Fly, NYSE Chief Seeks to Reassure [DealBook]

**jfcarney(1:57:24 PM): also, did you make those Thain quotes up? If so you should at least put in a footnote explaining that we made that up because Thain isn't funny enough to say stuff like that. And also, have you issued a fatwa on your Return button?

ohbabyitssbess (1:57:53 PM): yes, yes and S a D.

Apparently no one at the SEC tipped off John Thain that they are looking into the alleged problems with the hybrid trading system.

John Thain, head of the New York Stock Exchange, told CNBC's Bob Pisani that there is no investigation by the Securities and Exchange Commission of trading problems at the the Big Board during Tuesday's market selloff.

The comment, which Pisani mentioned on air, appeared to contradict a Wall Street Journal report earlier Thursday that the SEC is looking into whether the NYSE's shift toward electronic trading affected its ability to handle a surge in trading volume.

Citing a person familiar with the matter, the paper said the regulators are concerned that capacity issues may have exacerbated the Big Board's woes this week.

We assume that what Thain means is that the SEC has not launched a formal "enforcement action" against the NYSE. But it stretches credibility to say that the SEC is not at least looking into the alleged problems with the hybrid system, especially since those problems have received so much media attention in the last couple of days.

And that should just about conclude our "All Thain, All The Time" coverage. No one should really have to read that much about John Thain this early in the day.

CNBC's Pisani: Thain Says No SEC Probe of NYSE Trading [CNBC.com]

Late yesterday afternoon we reported on New York Stock Exchange chief executive John Thain's interview on CNBC explaining why traders had been told to keep their books open past 4 PM.

But there was more than just that to the Thain interview. The NYSE chief also came out swinging—or what passes for swinging for the mild-mannered executive—in defense of the exchange's hybrid trading system.

"There was no problem with hybrid at all," Thain said.

Thain pinned the blame on a system called Designated Order Turnaround, or Dot, an older system that predated the hybrid trading system. DOT electronically routes certain orders to the floor of exchange.

But not everyone was convinced by Thain's performance. Reuters quoted a Prudential analysts note as saying:

"Clearly there would appear to be implications for the hybrid system and questions of reliability," wrote Prudential Equity Group analyst Rob Rutschow in a note, adding that, although the exchange claimed hybrid was not the issue, "NYSE may suffer damage to its reputation."

CNBC reporter Charlie Gasparino described Thain's remarks as "a lot of spinning."

NYSE defends new system despite glitch

Evidence is mounting that John Thain is a—and we don’t want to say liar, ‘cause that’s not the right word, but how about a—con man? Swindler? Used Car Saleman? Whatever you’re comfortable with. The case made by threeformer NYSE seatholders against the NYSE, who sold their seats in late 2005 for around $1.5 million each, claiming that Chief Executive John Thain did not inform them of appending merger with Archipelago, which caused seats to jump to $2.4 million, and a $4 million sale that December, was thrown a bone today, according to the Post.

"The folks at Wall and Broad don't get it. It would take one to two years to go public and we have no plans for that," Thain allegedly said, referring to a popular seatholder-only Web site then rife with speculation about the exchange's future.

Thain has said he has no recollection of the statement. But The Post has obtained sworn declarations from three attendees of the Feb. 15, 2005, meeting that support [seatholder] Richard Wey's claims.

Held at the NYSE in a swanky room numbered 630, the 10-person breakfast meeting was meant to be a chance for Thain to address concerns and questions about the NYSE from some of the exchange's most respected specialists and brokers.

In sworn testimony, Glenn Carell, a specialist at Bear Wagner Specialists, said that after Wey asked "[if] the NYSE was going public," Thain replied, "No. It would take at least one to two years or longer to go public and we have no plans for that."

Fishy (though that could just be an old piece of lox from the "swanky" breakfast). But not uncharacteristic of a man who has been known to harbor a secret or two in the past.

TRADERS BACK SUIT, CLAIM THAIN MISLED [NYPost]

Close viewing of Tuesday’s appearance by Victoria Secret Models at the New York Stock Exchange prompted more than one viewer to wonder if they had just witnessed NYSE chief executive John Thain, uhm, scoping out the ladies. You can watch the video for yourself here. The alleged ogling takes place about twenty seconds into the video. It seems more likely that he’s just innocently watching the closing gavel about to get banged but judge for yourself!