Spengler on “Obama’s one-trick wizards”:

One wants to ask the Wall Street wizards who comprise the talent pool for the incoming administration, “If you so smart, how come you ain’t rich no more?”

Manhattan’s toniest private schools, harder to get into than Harvard, quietly are looking for full-tuition pupils now that the children of sacked Wall Street bankers are departing for public schools in cheaper suburbs. Harvard University president Drew Faust has warned of budget cuts to come due to “unprecedented losses” to its US$39 billion endowment.

Shares of Citibank, the current firm of Bill Clinton’s treasury secretary Robert Rubin, last week traded at less than a tenth of their year-earlier market price and may require yet another federal bailout. [Citigroup will have more than $300 billion of troubled mortgages and other assets guaranteed by the US government under a federal plan to stabilize the lender after its stock fell 60% last week, Bloomberg reported today, November 24. Citigroup
also will get a $20 billion cash infusion from the Treasury Department, adding to the $25 billion the bank received last month under the Troubled Asset Relief Program. In return for the cash and guarantees, the government will get $27 billion of preferred shares paying an 8% dividend.]

Rubin, a transition advisor to president-elect Barack Obama, was mentor to Treasury secretary designate Timothy Geithner. Even Goldman Sachs, the thoroughbred trading machine that gave us Treasury Secretary Hank Paulson as well as Rubin, is trading at a fifth of its peak value.

These facts came to mind while reading David Brooks’ November 21 New York Times panegyric to Obama’s prospective cabinet, which gushes, “Its members are twice as smart as the poor reporters who have to cover them, three times if you include the columnists.” Brooks added, “… as much as I want to resent these overeducated Achievatrons … I find myself tremendously impressed by the Obama transition.”

Has Brooks checked the markets? The cleverest people in the United States, the Ivy-pedigreed investment bankers, have fouled their own nests as well as their own net worth, and persuaded the taxpayers to bail them out. If these are the best and the brightest of 2008, America is in very deep trouble.

As the adage goes, read it all.

Meanwhile, thanks to Mike for the link which is circulating to this post on the conservative message-board Free Republic, from back in March of this year, which apparently not only predicted the timing of the financial collapse (based on alleged leaks from a closed-door session of congress), but also set out a timetable for even worser things to come, like civil war, the rounding up of “insurgents”, the setting-up of detention centers, the creation of a pan-North American nation (shades of “Masked and Anonymous”!) and more fun besides. Nonsense, of-course. Though the Icelandish people certainly aren’t laughing at the moment.

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