Jacob Lew, Obama’s New Chief-of-Staff, Will Not Please Occupy Wall Street

jacob lew Jacob Lew, Obamas New Chief of Staff, Will Not Please Occupy Wall StreetMaybe you’ve heard: President Obama’s chief-of-staff, Bill Daley, has stepped down. Taking Mr. Daley’s place will be Jacob Lew. This will not please some people.

Before we get to those people, here are some fun facts about Bill Daley:

- Prior to being appointed, Mr. Daley was a vice chairman at J.P. Morgan.
– Mr. Daley at one point held $7.6M in stock from the company.
– In 2010, Mr. Daley made $8.7M from J.P. Morgan.

Seeing as how sentiment against the unmitigated profits of Wall Street reached fever pitch over the last year, one would think President Obama would be wise to consider resumes from other corridors of power to choose from when deciding upon a new chief of staff. And maybe he did!

In the end, however, he decided upon Jacob Lew. Here are some fun facts about Jacob Lew:

  • Prior to his appointment as a deputy secretary at the Department of State, Mr. Lew was Chief Operating Officer of CitiGroup’s Alternative Investments group.
  • Do you know what Alternative Investments are? They’re things like hedge funds, who buy things like credit default swaps! Credit default swaps are essentially the ability to buy insurance on someone else’s house in one hand as you hold anything else—the adjustable-rate mortgage you know they can’t pay off, or the capacity to sell that mortgage and therefore generate more mortgages like it, or a gasoline can—in the other hand. This is what Jacob Lew invested in!
  • In 2008 and the beginning of 2009, Mr. Lew took in $1.1M from CitiGroup.
  • This included a $900,000 bonus.
  • Mr. Lew doesn’t think financial deregulation was one of the problems adding up to the financial crisis that has persisted since 2008.

 
Mr. Lew is, like President Barack Obama, a Harvard graduate. He appears to be very intelligent! The money he made from CitiGroup really isn’t that much in the very large scheme of things, and Citi is commonly a punchline as far as the largest investment banks go. He’s probably a nice guy, too.

None of that will likely make a difference to someone who is still upset with the financial system and the people responsible for the havoc it wrecked on the global economy. That said, if the Republican candidates for president or the committees helping them with their campaigns are looking to assault President Obama for Mr. Lew’s appointment, they’d be well advised to recall his nomination to the Office of Management and Budget, which “sailed through” the Senate in a voice vote.

Anyway: Congratulations, Jacob Lew! Enjoy that new job of yours. It will surely be rewarding both personally and financially and not stressful in the least.

fkamer@observer.com | @weareyourfek

Comments

  1. Mookiefan says:

    Does the Observer have anyone who knows something about finance? Citi’s “Alternative Investment” group refers to hedge funds. Wall Street bonuses, when they are paid in cash as they typically are, are taxed as regular income. Why not just come out and say what you really believe – Lew is a bad choice from the writer’s perspective because he worked on Wall Street. Why litter this with innuendo that points to a fundamental ignorance of finance?

    1. Trusty says:

      What do you expect from the New York Observer?  Journalism?

    2. Foster Kamer says:

      Yes: Among several of them, one of the units in the Alternative Investment group (that Jacob Lew oversaw) invested in hedge funds, you’re right. Reminder: One of those funds was John Paulson’s Advantage Plus, which they had $18M in. Do you know what Paulson was big on? Of course you do, because you know how all of this works. But just to remind you, Paulson was big on credit default swaps, especially the ones Goldman Sachs sold him to bet against CDOs he knew weren’t worth the sweat on his ass (and he knew this because, as we all know by now, he was paying Goldman Sachs to let him cherry-pick and then market to suckers the worst ones to bet on; Fabbie Fab, hollerback!).

      So, yes: While “Alternative Investments” refers to hedge funds, they also, by extension, refer to said swaps. We occasionally understand how these things work.

    3. Anonymous says:

      you show fundamental ignorance of finance when you casually say “hedge fund”.  I’m sure he’ll do plenty of “hedging” at the white house, and no, not to the bushes.

  2. Richard Kracke says:

    Mr. Lew may be a Harvard graduate and “intelligent”…but he is not what this country needs right now in any government position.  It is people like him that we want out of the political process.  Is anybody listening to what the American people are protesting about?

    1. Anonymous says:

      I think they are, gotta get their pins lined up.