| Tellingly, the New York Times didn't bother to send a reporter, relying instead, online anyway, on the AP for its report on Malpass' announcement.
And the AP soft-pedaled Malpass' record as chief economist at Bear Stearns, which help cause the Great Recession.
The AP story did not even mention where Malpass made his multi-millions, until it sourced Gillibrand's campaign in the fifth graf:
The Gillibrand campaign noted that Malpass had been chief economist at the Bear Stearns investment bank from 2001 until it collapsed in 2008.
"David Malpass not only helped cause the financial collapse, he made millions and left taxpayers holding the bill," Gillibrand spokesman Glen Caplin said.
And what happened at Bear Stearns when Malpass was its chief economist?
In short, a monumental train wreck, according to the wiki:
Bear Stearns pioneered the securitization and asset-backed securities markets, and as investor losses mounted in those markets in 2006 and 2007, the company actually increased its exposure, especially the mortgage-backed assets that were central to the subprime mortgage crisis.
In March 2008, the Federal Reserve Bank of New York provided an emergency loan ($25 billion!) to try to avert a sudden collapse of the company. The company could not be saved, however, and was sold to JP Morgan Chase for as low as $10 per share, a price far below the 52-week high of $133.20 per share, traded before the crisis, although not as low as the $2 per share originally agreed upon by Bear Stearns and JP Morgan Chase.
The collapse of the company was a prelude to the risk management meltdown of the Wall Street investment bank industry in September 2008, and the subsequent global financial crisis and recession. In January 2010, JP Morgan discontinued use of the Bear Stearns name.
Bear Stearns is essentially the Enron of the Wall Street meltdown (without the criminal indictments, yet) that has screwed up the national economy for two years or so.
And Malpass was its chief economist.
In that position, Malpass presumably advised Bear Stearns management that real estate in hot markets like California, Nevada, Arizona and Florida would continue to go up forever.
And that complex Bear Stearns bonds that aggregated mortgages from hot real estate markets were good for Bear Stearns, if not so good for those who bought those bonds, or American taxpayers.
And that making money for Bear Stearns, and David Malpass, was really all that mattered.
There are three relatively unknown GOP challengers to Gillibrand in the race now.
The Wall Street bankster is getting some press this week, and he obviously can self-fund from his Bear Stearns stash.
But here's the real political wisdom -- no one is beating Kirsten Gillibrand this year, least of all a rich Wall Street bankster. |
