To paraphrase Lloyd Bentsen, you haven't met a real elitist until you consider the life of John Paulson. His salary last year: $3.7 billion. That is not a misprint: three billion, seven hundred million dollars. Now that's doing elitism in a big way. Welcome to the new Gilded Age.
Today, Institutional Investor Magazine releases its rankings for the big paychecks for the hedge fund managers on Wall Street. Drum roll, please:
John Paulson earned a record $3.7 billion last year to top Alpha's ranking of the 50 most highly paid hedge fund managers. The Paulson & Co. chief surpassed perennial powerhouses George Soros and James Simons, who ranked second and third, at $2.9 billion and $2.8 billion, respectively. The top 25 on the list earned an average $892 million, up from $532 million in 2006.
Paulson rocketed to No. 1 in Alpha's seventh annual survey by shorting the subprime mortgage market. He, Soros, Simons and the others who earned more than $1 billion -- Philip Falcone and Kenneth Griffin -- led what may well prove to be the greatest display of individual wealth creation in any year in the modern history of finance.
The enormous riches being generated by hedge funds come at a time of extraordinary distress in financial markets, as millions of homeowners face potential foreclosure and the U.S. plunges into recession (see "Market Paranoia"). Undoubtedly, the huge paydays chronicled here are sure to cause a heightened level of envy and resentment toward hedge funds, and will draw additional scrutiny by Washington, which is already weighing whether to increase regulation.
Here is the list of the top ten earners.
The New York Times carries a story
about the rankings with this amusing quote:
Even on Wall Street, where money is the ultimate measure of success, the size of the winnings makes some uneasy. "There is nothing wrong with it -- it's not illegal," said William H. Gross, the chief investment officer of the bond fund Pimco. "But it's ugly."
Do you think? With millions of people looking at underwater mortgages, wages going nowhere, health care still a myth for 45 million Americans...no, it's not "ugly", it's obscene, disgusting, morally reprehensible and should be grounds for tarring and feathering.
Now, wouldn't it be nice if tonight's debate actually focused on this absolute travesty and legalized theft?