2009 April 05 post from road
The Wall Street Journal reports:
WASHINGTON -- Top White House economic adviser Lawrence Summers received about $5.2 million over the past year in compensation from hedge fund D.E. Shaw, and also received hundreds of thousands of dollars in speaking fees from major financial institutions.
A financial disclosure form released by the White House Friday afternoon shows that Mr. Summers made frequent appearances before Wall Street firms including J.P. Morgan, Citigroup, Goldman Sachs and Lehman Brothers. He also received significant income from Harvard University and from investments, the form shows.
See disclosures from:
In total, Mr. Summers made a total of about 40 speaking appearances to financial sector firms and other places, with fees totaling about $2.77 million. Fees ranged from $10,000 for a Yale University speech to $135,000 for an appearance paid for by Goldman Sachs & Co.
The disclosure -- in a financial report that is required for federal office holders -- comes as Mr. Summers is involved in shaping the Obama administration's policy decisions on the financial meltdown as well as the broader recession. Among the many decisions the economic team has wrestled with has been whether to step up regulation of hedge funds, one of the most contentious subjects during a summit of world leaders this week. European nations pushed for tougher rules, while the Obama administration preferred a less stringent approach.
Comments
This doesn't mean his firm was doing anything wrong. Anyone who has been in the business knows you need someone to call just to get fair treatment from the SEC and other Government agencies. They are usually leaning on firms over some trivial record-keeping matter, rather than something of importance, like Ponzi schemes.
One problem comes when the firms misuse their influence, such as certain firms did with Paulson and the Fannie/Freddie debacle. Logic would have said that the Treasury would simply guarantee newly issued senior debt. This may have saved Lehman and prevented the credit crisis. Yet, some influential people owned subordinated debt and made a lot of money when Paulson indirectly guaranteed it.
The biggest problem, of course, is the influence of real crooks like Bernie Madoff. He was able to prevent the SEC from investigating an obvious Ponzi scheme.
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