Dan Loeb Simultaneously Solicits, Betrays Pension Funds
Excerpt:
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).
The point is, many of these guys owe their outrageous lifestyles to people who actually work for a living, who've been putting nickels and dimes away week after week for years, just so guys like Loeb can swoop in, make a pitch after a fancy lunch or two, and then take big chunks of that cash to buy private jets and Picassos.
Full article: Dan Loeb Simultaneously Solicits, Betrays Pension Funds | Matt Taibbi | Rolling Stone.
