I’m far from perfect and no one should point fingers at those who make mistakes, as we are all human and make mistakes as well. That said, in keeping with the recurring theme of my blog these days that “The Emperors Have No Clothes“, let’s take a look at those who chose to be wrong…those who had all the information but went out of their way to ignore it and be epically, willfully ignorant. The Reformed Broker presents…
Great Moments in Willful Ignorance
Erin Callan (Former CFO – Chief Fool-the-Public Officer – of Lehman Brothers)
How could a seemingly intelligent and obviously successful investment banker-turned-CFO be so completely wrong about the health of her own firm, Lehman Brothers, in 2008? There can be only one possible answer: It was her job to be delusional and to spread false tidings of health and transparency wherever she went. Anytime the media describes an executive of a Wall Street firm as a “Rock Star“, you can turn the BS meter on and leave it running. Because virtually every appearance made by Ms. Callan, the Anne Boleyn of Finance, was an exercise in denial, we’ve chosen to represent her 6 month stint by posting the above rise-and-fall timeline by CNBC‘s Maria Bartiromo.
Baghdad Bob (Mohammed Saeed al-Sahhaf, Iraqi Disinformation Minister During the Invasion)
Am I the only one who misses this guy?
David Lereah (Chief Bubble-Blower-Upper at the National Association of Realtors, 2001-2007)
On July 24th 2006, the real estate spin doctor of the decade actually sounded as though he had finally managed to spin himself into another dimension of insanity, first remarking that he was personally building condos all over Florida and then enthusiastically comparing the rampant building in Florida to the California Gold Rush without even a trace of irony. Apparently, no one told him what a major bust the Rush turned out to be for 99.99% of those who headed west with pick axes. Bonus points awarded for the fact that he also wrote a book about getting rich by investing in tech stocks that came out in the Spring of 2000, literally the peak of the dot com bubble. He’s since admitted to his and the NAR’s propensity for happytalk. You can basically short this guy 24/7.
George W. Bush (Former President of the United States and Ranching Enthusiast)
“Brownie, you’re doing a heck of a job” said the President on September 2nd, 2005, four days after Hurricane Katrina made landfall in New Orleans. He was speaking in praise of FEMA head Michael Brown, who may not have known there was a hurricane until 48 hours or so had gone by and clearly had no idea what to do about it once he did.
Ned Riley (former Chief Rip-Snorting Bull at State Street Advisors)
Riley made one of his usual uber-bullish CNBC appearances on August 17th of 2007 (Dow 13,000 with the rate cuts and sub prime debacle beginning). He dropped such a cornucopia of devastatingly awful advice that you need to see it to believe that this all came out over the course of 9 minutes. Peter Schiff, Trish Regan and Dylan Ratigan were all on hand for the festivities. Some choice nuggets? First, Riley repsonds to a question from someone who is 58 and retiring at 59 by commenting that it might be a good idea to be 95% in equities. Minutes later, he recommends large, stable money center banks (remember those) and the XLF (bank index ETF). He also remarked that the market was at a good valuation, the Fed will save the day, it’s just the Countrywides with the sub prime problems, buy the S&P 500, buy tech stocks…etc. Ned Riley would call The Apocalypse a buying opportunity.
Thanks for tuning in to Volume One of Great Moments in Willful Ignorance. I fervently hope never to have to publish Volume 2, but nothing happening in the world today gives me any indication that I won’t.