Taibbi: Many Self-Congratulating Millionaires Aren't 'Self-Made,' But Actually Living Off Your Money

[Hissyspit]

http://readersupportednews.org/opinion2/279-82/16929-focus-dan-loeb-hedge-fund-king-with-balls

One thing that people need to realize about Wall Street and the financial system in general: many of the self-congratulating millionaires and billionaires you read about in the news aren't "self-made" in any real sense, but actually live either directly or indirectly off of your money. The quickest way to extreme wealth in this world is to attach oneself to giant piles of institutional money like public pension funds.


Dan Loeb, Hedge Fund King With Balls

By Matt Taibbi, Rolling Stone

13 April 13

- snip -

In other words, Loeb has been soliciting the retirement money of public workers, then turning right around and lobbying for those same workers to lose their benefits. He's essentially asking workers to pay for their own disenfranchisement (with Loeb getting his two-and-twenty cut, or whatever obscene percentage of their retirement monies he will charge as a fee). If that isn't the very definition of balls, I don't know what is.

- snip -

Weingarten quickly wrote back to shore up the meeting, letting Loeb know that there would be some other voices at the table. "A small group of pension fund trustees are interested in joining us," she wrote, "including two funds that are current clients of yours."

It seemed that representatives from New Jersey and Ohio, along with several groups from states like New York, Pennsylvania and California who had not yet invested with Loeb, wanted to meet with him personally to clarify his views on public pensions before making a decision about whether to invest (or, perhaps, disinvest).

After receiving this letter, Loeb suddenly changed his mind about wanting to meet. "Unfortunately, I am not free following my presentation as I have made a prior commitment and am then leaving for New York." He added:

I have learned that SFNY advocated a choice between the two types of plans, a recommendation favored by a majority of younger teachers. Beyond that, I'd be pretty useless in a discussion on such an esoteric copy, so I suggest that Ms. Weingarten discuss her concerns with either Michelle Rhee, the national director of Students First and a member of our board, Joel Klein, our Chairman, or Micah Lasher, our executive director.

This one doesn't need much of a translation. Yeah, I know you represent $800 billion, and that some of your members have already given me tons of cash, but I'm busy, so blow me.

- snip -

One thing that people need to realize about Wall Street and the financial system in general: many of the self-congratulating millionaires and billionaires you read about in the news aren't "self-made" in any real sense, but actually live either directly or indirectly off of your money. The quickest way to extreme wealth in this world is to attach oneself to giant piles of institutional money like public pension funds. The subprime mortgage crisis was fueled in large part by sociopathic hotshots from banks and hedge funds who convinced institutional investors - your corporate retirement fund, your public pension, your union - to buy crappy mortgage-backed securities.

Guys like Dan Loeb, they don't actually do anything, other than shave cuts off of other peoples' money. The psychological justification for taking such high fees is that they earn for their clients, but even that's debatable in some cases (AFT points out that some of Loeb's funds haven't even outperformed the S&P).

MUCH MORE AT LINK[p]

[PDJane]

1. Yes. I wish that more were aware of this.

There is a finite amount of money and resources in the system. If it all congregates at the top, extreme poverty is rampant.

[octoberlib]

2. This seems to be a global problem.

“The major western democracies are moving towards corporatism. Democracy has become a business plan, with a bottom line for every human activity, every dream, every decency, every hope. The main parliamentary parties are now devoted to the same economic policies — socialism for the rich, capitalism for the poor — and the same foreign policy of servility to endless war. This is not democracy. It is to politics what McDonalds is to food.”
― John Pilger

http://www.goodreads.com/quotes/tag/politics?page=25

[PDJane]

3. It started, as too many of these things do, with the US and Great Britain.

Specifically, with Maggie Thatcher and Ronald Reagan. It has metastasized.

[HiPointDem]

5. that's because it's the same class of international rentiers pushing it everywhere, along with

'free trade' agreements that will institutionalize the arrangement & remove the last vestiges of national democratic control over them.

[antigop]

7. Chomsky explains this rather well in the video posted in the video forum

http://www.democraticunderground.com/1017111501

[GeorgeGist]

4. Not true.

ALL Self-Congratulating Millionaires Aren't 'Self-Made,' But Actually Living Off Your Money

[iandhr]

6. Agree with you on the Wall Street.

But Silicon Vally millionaires got rich by creating a product.

There is a great segment in Charles Ferguson's Inside Job where Eliot Spitzer talks about the difference between the people of Silicon Vally and Wall Street.

[Egalitarian Thug]

15. The "people (billionaires) of Silicon Valley" are every bit as parasitic as the banksters.

I'm happy to go down the list with you and show you how they made these vast fortunes, not from working to create great products, but through theft, perjury, kettling consumers, and government largesse garnered through bribery and connections, just like ever generation of robber barons that came before them.

"The secret of great fortunes without apparent cause is a crime forgotten, for it was properly done." - Honoré de Balzac

[DarkLink]

8. This includes CONgress who is insider trading, ripping everyone off

just to make themselves more money...



Fed Sends Insider Info to Goldman Sachs, Barclays, JP Morgan, CITI, HSBC, UBS and Congress!
http://www.democraticunderground.com/10022650050

'Congress Repeals Financial Disclosure Requirements For Senior U.S. Officials'
http://www.democraticunderground.com/1014452676

[Initech]

9. Paul Ryan (loser) has it backwards. We make, they take.

[glinda]

10. K&R

[WillyT]

11. K & R !!!

[Hissyspit]

12. Kick nt

[DonCoquixote]

13. a simpler way to express this

For all of Bill gate's wealth, he is a dinosaur. He made a product you put in a box, and sell in stores. It used to be that, the "titans of industry" were people who, at the end of the day, did make something they had to put in a box, market, and sell to John and Jane Q Public.

That era is dead, and with it, old school capitalism. As long as a would be tycoon had to make and sell a product, there was some accountability. There are 2 reasons:

One: the products are ill defined, so much so that their worth is impossible to quantify and account for. Try to explain what a "derivative" is. Now, in more honest times, we could use casino terms, such as : it is insurance against your gamble going so bad that you go completely broke. However, if that happened, then a can of worms would be opened, such as the fact that most seasoned gamblers call this type of insurance a "sucker bet", or the fact that selling deratives was just another form of gambling, done in the boiler rooms that old school Mafia types used.

SO go ahead and try to research what is a derative, and then figure out how you are supposed to account for their value. The same rating agencies that threaten to downgrade a country;'s rating are the same ones that considered derivatives the safest bets around? Looking up Standard and Poors might as well be like asking a junkie for medical advice.

Two: the rich are trying to dump the American consumer. India and China are getting a middle class, and the rich would much rather market to a larger amount, especially if they can use the government to manipulate said masses from the get go. For all the vestiges of communism, China is becoming a corporate bordello.

[Egalitarian Thug]

14. And this purely parasitic industry accounts for roughly half of all profits in the U.S. today.

Think about that for a bit, and then try to figure out a way that this nation can "come back" from this economic course.