Thursday, October 13, 2011

Some in Big Finance are Sympathetic of "Occupy Wall Street"

From an article in Business Week:
Jim Chanos, founder of $6 billion hedge fund Kynikos Associates, and Bill Gross, who runs the world’s biggest bond fund, joined top asset managers in voicing understanding for anti-Wall Street protests as they spread to Manhattan’s Upper East Side, home to the city’s financiers.

Chanos said New Yorkers don’t appreciate the impact government bank bailouts have had on other U.S. citizens. Gross, who works at Pacific Investment Management Co., said that wage earners are fighting back after three decades of class warfare against them.

“New York is so finance-centric that people here underappreciate the reaction of the rest of the country,” Chanos, who was born in Milwaukee, said yesterday in an interview in New York. “People are angry, they feel the game is rigged, that they didn’t get their fair shake.”
The French revolution went from being isolated populist uprisings to a full scale revolution when the middle class used the ocassion of the King's calling of an Estates-General to join into the revolt and turn it from petty violence into a social change deposing the corrupt "advisors" around the King. Over time that spread to overthrowing the corrupt aristocracy which showed its class warfare colours by plotting with aristocracy outside France to invade France and restore the King. As Mark Twain said "History does not repeat itself, but it does rhyme".

There is no telling where public sentiment will run as the truth seeps out:
“Class warfare by the 99%? Of course, they’re fighting back after 30 years of being shot at,” Gross said on a Twitter post.

Fink, whose firm has $3.7 trillion under management, said last week he understands the concerns of protesters speaking out against financial companies in New York and other cities.

“These are not lazy people sitting around looking for something to do,” Fink, 58, said on Oct 5 during an event in Toronto. “We have people losing hope and they’re going into the street, whether it’s justified or not.”

Fink received $23.8 million in compensation for 2010, a 50 percent increase from the previous year.

Joe Dear, 60, chief investment officer of the $218 billion California Public Employees’ Retirement System, said yesterday in a CNBC interview that people are “waking up” to the fact that “the game appears to be rigged.”

“The financial system gets bailed out, executives’ salaries stay high and the incomes of people who work for a living, paycheck to paycheck, continue to decline,” he said.

Buffett, chairman of Berkshire Hathaway Inc., said in August that the nation’s richest people have been “coddled long enough by a billionaire-friendly Congress” and called for higher taxes for the “mega-rich” in the U.S.

Buffett, the world’s third-richest man, according to Forbes Magazine, told Charlie Rose in New York during a Sept. 30 interview on PBS that class warfare is going on, “and my class isn’t just winning, I mean we’re killing them.”
The classic response of dictators and oligarchies under attack is either to immediately use violent repression or to attempt to buy off popular sentiment with halfway measures. It isn't clear which way the US will go.

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