It all started a few years ago when I was getting bored with my job. I mean there are only so many legitimate ways you can invest other people’s money. Then we had a convention in Las Vegas, and it occurred to me: These guys know how to have fun and make money.
So I hired a couple creative young guys–persuaded them to drop out of college. They came up with this beautiful scheme–synthetic assets, virtual cash flow, bundled derivatives–it was beautiful; so complicated no one could understand it. What it boiled down to was this: We sell bundles of bad mortgages to pension plans, then we buy insurance policies betting that the mortgages go bad.
I said no one could understand it: that’s not quite true. Some of the legal boys said, the only problem boss, is it’s illegal. So we get a few more bright kids to drop out of college and send them to Washington as lobbyists. They sell the idea that burdensome and obsolete banking regulations are stifling the economy and keeping us from competing. We send a few senators to a resort in the Caribbean to think it over, and pretty soon they see things our way.
Then, here’s the beauty of it. The bonuses are rolling in, then one of those bright kids in accounting says, “Boss, we’ve got a problem.” He tells me the whole world economy is about to tank, and the big banks are going under. Then another bright kid gives me an idea. “No way they’re going to let it happen.” I see he’s right. So I start investing in those banks that we ruined by selling them toxic assets.
Now I own the banks that the poor working schmucks bailed out–and I give myself a big bonus from the bail out money we brought in. Now the Fed is loaning money at 0.5 % interest; I’m taking it and buying treasury bonds that pay 3%. I’m using the taxpayer’s money to loan money to the government to pay back the bailout money that’s paying my bonuses.
But one of the bright kids in public relations says, Boss, the tax payers aren’t stupid. They’re going to demand some of that money back. They might suggest a sur-tax of 5% on incomes above 1 million dollars or something.
So I hire a public relations firm to stir up “grass roots” support and plan these tea party events to protest against anyone raising my taxes. They even have a Tina Fey look-alike drawing big crowds.
Charlie was my best friend in college. Poor guy wasted his life if you ask me; became a basketball coach. His team made it to the Final Four last year, and now he’s making a million and a half a year. A million and a half! How does anyone live on that?
What’s worse, his daughter went to college to become a teacher. And now the schools are laying off. Charlie says he’s going to help her out. Like he can afford to on his miserable pay check! If you ask me, it was her choice to throw her life away.
Sure I could buy her a school if I wanted to. It’s not easy to spend $3 million a day! I buy a nice house in Miami on Monday, on Tuesday I make a down payment on one in San Francisco and finish paying on Wednesday–pretty soon I have houses in all fifty states, and it’s only February!
I could buy her a school. But she had her choice. She could have chosen a responsible career like I did.
[Note: The top 30 hedge fund managers averaged one billion dollars each in salary and bonuses last year. ]