When the history of the Great Recession is written, one of the
standout points of this era will be that the New York City economy,
the epicenter of the toxic concoctions, escaped relatively
unscathed.
Walk around the city this balmy September and it feels exactly
the same as it did in September 2006 or 2007. Restaurants are
teeming with diners. Taxis are hard to come by for the first time
since the financial crisis began.
The trickle-down effect has helped the city's economy and kept
real-estate prices aloft.
But not far from the renewed hum of Wall Street is the very real
notion that trillions in taxpayer bailouts made this all possible.
That's why the pillars of the hedge-fund and private-equity
industries, should just shut up and count their blessings,
especially as the overall economy has stalled.
An example of what not to do was on full display this week when
Anthony Scaramucci, a hedge-fund honcho, challenged President Obama
during his town hall meeting. Trying to piggyback on the ire within
Corporate America about the administration's overtly anti-business
bias, Scaramucci asked why "Wall Street" was being hit like a
piñata. "Maybe you don't feel like you're whacking us with a stick,
but we certainly feel like we've been whacked with a stick."
Obama was correct when he scolded Scaramucci with this response.
"After a huge crisis, the top 25 hedge-fund managers took home a
billion dollars [each] in income that year. A billion! That's the
average for the top 25. The secretary of a hedge fund is probably
being taxed at 25 percent, 28 percent, right? And [the hedge-fund
managers] are being taxed at 15 percent."
The translation of what Obama was saying: "Maybe you should be
taxed more like your secretary when you're pulling home a billion
dollars or $100 million dollars a year, I don't think I'm being
extremist or anti-business."
Yes, the bull market in Wall Street arrogance has returned and is
on its way to new highs. Let's hope it doesn't take another crisis
to bring these egos down to earth.
