The Turning of the Tide

Warren Buffet has said that a rising tide may lift all boats, but when the tide goes out you get to see who’s been swimming naked.

When the economy sours, it seems that the scandals come out. A couple years ago it was Enron and WorldCom. The latest news is about a couple of Bear Stearns fund managers, who told investors that all was well even while they were panicking over the sub-prime meltdown. They join a rogues gallery who thought that the good times could be just a little better for them if they shaded the truth.

As bees are drawn to honey, crooks are drawn to money. When times are good, no one wants to hear about Wall Street’s peccadilloes. But when times get tough this crowd gets no sympathy.

I’ll never condone wrongdoing, but the sad fact is that these guys are small potatoes. Why was Bob Rubin paid $10 million by Citigroup if not to warn them about the sub-prime shuffle? Citi has lost $150 billion in market cap since last summer; now Rubin’s at the trough arguing for a bigger bailout.

That’s a crime that will never be prosecuted.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By |2014-09-03T19:50:06+00:00June 23rd, 2008|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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