GSTAAD—There’s fear and loathing around here, and it has nothing to do with lousy snow conditions. Fear that UBS, the biggest Swiss bank, is in trouble, loathing of those whose greed brought this about. Reckless and banker are now synonyms as the financial system is on the brink. UBS has denied it is in trouble, but then so did Bear Stearns just before it collapsed. In other words, there is a credibility problem, one that dwarfs Fayed and the Mills woman put together. Asset write-downs and credit losses will continue, according to the greatest financial expert of our times, Professor Taki, OBE, MBE, UBS, JPM, and job cuts and asset sales are a given, always according to the professor.
So what else is new? Bear Stearns is roughly 30 percent owned by its staff, but it’s the top dogs who brought the place to its knees. A 70 billion dollar company sold for two bucks a share—oy veh! But there’s help in the horizon. Just kidding, of course. Sovereign wealth funds, those state-backed funds flush with oil moolah, are staying away in droves. Foreign investors like this Alwaleed fellow—he’s big in Citigroup—have already seen their investments down roughly 38 percent, so they’re staying away with a vengeance. What does the great financial professor Taki see in his crystal ball? That’s an easy one. More pain, less options for the Federal Reserve, overpriced housing becoming under-priced, and, as always, a bailout for the truly greedy. Ah yes, I almost forgot. China, Dubai, Kuwait and other such great democracies will end up owning large chunks of American financial institutions, which means that the next time you see American banking big shots, they will be wearing a checkered table cloth on their heads.
As we all know, human greed has no frontier, but the Bush administration is unique in its ignorance and incompetence. Where were the federal regulators when all this reckless lending was taking place? In Iraq, I suppose, getting kickbacks from Haliburton and Cheney. Incidentally, as I write this, there are 80,000 Sunnis spread all over Iraq who were paid 10 dollars per day to fight against al-Qaeda—the only way we could get anyone to fight on our side—and these 80,000 suckers have not been paid the last three months or so. Which means they’re turning against us quicker than you can say Haliburton. What I’d like to know is if there are other American contractors who have not been paid? A little birdy tells me no way. Yet Bush insists the corner has been turned and we are about to pronounce victory in “Eiraq,” as he calls it.
Poor fools that we are. Bush was elected twice, and Blair three times, which means the only good thing Brown has going for him is that he’s unelected. And he is, needless to say, doing a fantastic job—along with those morons in Parliament. But I’m being a bit rough on morons. The freeloaders in the House of Commons seem to have not paid attention to what’s happening in the money markets, much too busy getting free furniture and taking free trips to exotic places, I suppose. They want more public spending. They remind me of the fat crook Robert Maxwell during his last days. He went throwing money away in a cheap casino. They see belt-tightening the way Heather Mills views a chastity belt. And it gets better. While snarling youths attack an Anglican rector and scream that his church should be a mosque, a liberal research group demands that Britons must do more for Muslims to feel at home. Why not turn the country over to them and be done with it, says poor little me.
These Labour and Liberal MP clowns who insist on more public spending are the equivalent of the Steve Schwarzmans and Henry Kravises of this world. Schwarzman managed to take out close to 8 billion last year, now only four billion, but it’s his numerous investors who have been left holding the bag. I once went to his house for dinner, twice in fact, and noticed not a single book anywhere, and the house is the biggest triplex in the Bagel. Schwarzman may be illiterate but he can count up to one hundred billion. Hence it is ironic that he pledged 100 million dollars to the New York Library, a place he has not spent much time in except for gala fundraisers. His friend George W. Bush has managed to deracinate 1.5 million Iraqis to Syria, 2 million to Jordan, 3.5 million desperately poor people who could use 100 million greenbacks. Instead they go to a library which none of Schwarzman’s friends, family or acquaintances ever use. Go figure. I have. The library will name a wing after this greedy slob, so the next time you’re in the Bagel, make sure you go to the Schwarzman wing and look at some DVDs. I was in Rome last year, at the Valentino goodbye extravaganza and saw Steve Schwarzman among the beautiful people. He is not very beautiful himself, in fact he looks like what he is, a bald and greedy little money shuffler. What was amazing to me was how many people went up to him in order to kiss his Coriolanus. Schwarzman is not unpleasant like Henry Kravis, another midget with a chip on his shoulder the size of a redwood. Kravis once threatened a writer friend of mine, Billy Norwich, a peaceful soul born Billy Goldberg in Norwich Connecticut. Every time I see Billy, whom I love, I ask him why he changed his name and why he didn’t call for help that night (I was in the premises). Billy said that he did the former in order to work at CondeNast, where he is currently employed, because he had heard although the firm was Jewish, it favoured employing Wasps. He was not aware that I would have loved to take on Kravis, as far as the latter question is concerned.
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The Usual Suspects