They had better not be accepting any bonuses.

Bear Stearns reported a loss of $854 million for the fourth quarter, as the firm continues to stagger from the collapse in subprime.

It is the first quarterly loss since Bear went public in 1985 and it comes as the firm took a wider write-down of $1.9 billion on its mortgage exposure. In early November, the firm estimated that it would need to take at least a $1.2 billion write-down.

Bear's biggest business—fixed income—had negative net revenue of $1.5 billion in the quarter, compared with revenue of $1.1 billion in the quarter a year earlier.

"We are obviously upset with our 2007 results, particularly in light of the fact that weakness in fixed income more than offset strong and, in some areas, record-setting performance in other businesses," said James Cayne, chief executive of Bear.

Cayne also confirmed a report that top executives at the firm will not receive any bonuses for 2007. So did the tactic of pre-empting its own bad news with the strategic leak about no bonuses work? Yes, says Jack Flack, because it "allowed Bear to be seen —at least initially—as the firm leading the executive austerity movement."

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