Could Someone Just Tell Me What It Is They Do?

Lord, don't make me reheat the now-stale and moldy leftovers of the Saga of the Global Economic Collapse.  Some of the ingredients of this particular shit sandwich include: mortgage-backed securities, AIG, collateralized debt obligations, Bear-Stearns, sub-prime loans, credit default swaps, Lehman Brothers, GM, bailouts, Chrysler, WaMu, executive bonuses.  There is so much to translate and untangle and it is all so complex that it will literally cause you to un-learn other things you used to know.  Hell, I was a classical pianist before the meltdown.  Now all I know is "Chopsticks." 

Just kidding.

Except not really.  Look, you know this stuff, right?  If you don't then you need to check in with your broker first thing.  Or look at the balance in your 401(k).  Just go ahead and stop at the liquor store on your way in tomorrow -- it'll save you some time.    

You'll need something to numb the pain, because as Matt Taibi points out in his must-read Rolling Stone piece, The Big Takeover, it's all designed to be painfully confusing.  And with the bailouts, it just got more so.  See if you can even fathom this:

The latest bailout came as AIG admitted to having just posted the largest quarterly loss in American corporate history — some $61.7 billion. In the final three months of last year, the company lost more than $27 million every hour. That's $465,000 a minute, a yearly income for a median American household every six seconds, roughly $7,750 a second. And all this happened at the end of eight straight years that America devoted to frantically chasing the shadow of a terrorist threat to no avail, eight years spent stopping every citizen at every airport to search every purse, bag, crotch and briefcase for juice boxes and explosive tubes of toothpaste. Yet in the end, our government had no mechanism for searching the balance sheets of companies that held life-or-death power over our society and was unable to spot holes in the national economy the size of Libya (whose entire GDP last year was smaller than AIG's 2008 losses).

No, I didn't think so.  Listen, if I lost $465,000 in one minute, someone had better string me up in the public square.  If my wife doesn't get to me first. 

So the baddest of the bad guys in this most recent mess -- that is, the AIG mess -- are the losers at AIG Finance Products, or AIG-FP.  They were the ones who blew it out, economically speaking, that is.  The head honcho there is, or was, a guy named Jake DeSantis.  Mr. DeSantis, you'll be pleased to see, has resigned.

Of course, he just can't for the life of him figure out why everyone is so gosh darn mad!  But wouldn't you know it, he's gonna be a stand up guy (cue Lee Greenwood's "God Bless the USA") and give back his million dollar "retention" bonus. 

Before you get all misty-eyed at Mr. DeSantis' generosity, read the rebuttal from, again, Matt Taibi, courtesy AlterNet.

Matt draws a number of conclusions:

DeSantis has a few major points. They include: 1) I had nothing to do with my boss Joe Cassano's toxic credit default swaps portfolio, and only a handful of people in our unit did; 2) I didn't even know anything about them; 3) I could have left AIG for a better job several times last year; 4) but I didn't, staying out of a sense of duty to my poor, beleaguered firm, only to find out in the end that; 5) I would be betrayed by AIG senior management, who promised we would be rewarded for staying, but then went back on their word when they folded in highly cowardly fashion in the face of an angry and stupid populist mob.

I have a few responses to those points. They are 1) Bullshit; 2) bullshit; 3) bullshit, plus of course; 4) bullshit. Lastly, there is 5) Boo-Fucking-Hoo. You dog.

Good points all. 

However, Matt never asks one question I'm interested in: just what exactly does a guy like Jake DeSantis do? 

No, I get it -- yeah, he's a "money guy" or an investor, or a banker, or whatever.  He deals with money.  A lot of money.  But... what?  I mean, how friggin' hard can it be? 

I want an answer to that question, and I don't want to hear two things: 1.) how guys like DeSantis earn their millions, because they work so hard.  Clearly they don't work hard enough or I wouldn't be killing brain cells trying to learn about variable annuities and toxic assets.  And 2.) how guys like DeSantis are essentially the managers of millions -- even billions -- of other people's money, and that's real stressful. 

Because in the end, I have a feeling the answer is... less than satisfying.

Oh, Matt is in rare form, and he gets real close:

Only a person with a habitually overinflated sense of self-worth could think he deserves a $700,000 retention bonus, even if it has to be paid by taxpayers, when in reality no one "deserves" that much money. It may be that some people do get paid that much, but most people who make that much money have enough sense to realize their cushy lifestyles are an accident of fate, of birth, of class, not something that is "supported" by some unwritten natural law of compensation.

Hey Jake, it's not like you were curing cancer. You were a fucking commodities trader. Thanks to a completely insane, horribly skewed set of societal values that puts a premium on greed and severely undervalues selflessness, communal spirit and intellectualism -- values that make millionaires out of people like you and leave teachers and nurses, the people who raise your kids and clean your parents' bedpans, comparatively penniless -- you made a lot of money.

Right on, brother -- but I want to see more.  I want to know how we make morons like Jake DeSantis actually come to understand this.  Figure that one out, gang, and I think maybe we'll start to scratch the surface of the real economic crisis.