Your Friday political reading is this Washington Post profile of Florida Senate candidate Jeff Greene, a billionaire who dropped into the state to challenge Rep. Kendrick Meek for the Democratic nomination and the right to face Republican Marco Rubio and Republican-turned-Independent Charlie Crist for the open seat. The Washington Post profiled Greene today, and his campaign appears to be making the case that, as a billionaire, he's immune to influence from the special interests. But man, get this guy some press training -- between cracking jokes about seniors (in Florida!) and offensive comments about Muslims, he's not, in the parlance of our times, ready for primetime.
Greene, though, made his money betting against the housing market:
A few years ago, he placed an enormously profitable bet against the crumbling housing market, a win he unabashedly peddles as evidence of his business savvy. ("Took on Wall Street and boldly predicted the collapse of the housing market," reads his campaign literature.) That windfall from the foreclosure crisis earned him a front-page 2008 Wall Street Journal headline, "In Beverly Hills, a Meltdown Mogul Is Living Large," a story from which he has publicly distanced himself -- but one that he had framed and displays in a bathroom in his mansion.
This makes Greene akin to one of the prescient traders in the Michael Lewis book The Big Short, which I reviewed when it came out, making the important point that these traders are not heroes, but villains -- their trades kept the mortgage bubble alive:
Greg Lippmann, a trader at Deutsche Bank, got into the CDS game against the prevailing winds in the market. He didn't make any bones about being a white knight, telling a skeptical colleague, "Fuck you. I'm shorting your house." He would even make T-shirts with the slogan.
That's all you really need to know, really: The Big Short was a bet against your house; whether or not you had a sub-prime mortgage. The devaluation these investors were counting on -- with hundreds of billions of dollars -- affected everyone. ... These traders weren't stopped by their consciences. As Steve Eisman, one of the money managers whose tale Lewis recounts, puts it: "We fed the monster until it blew up."
Somehow, I don't think that's the best 2010 election platform in the state of Florida, which has one of the highest foreclosure rates in the country.
-- Tim Fernholz
