Obama Advisor Paid Millions by Hedge Fund (hypocrisy alert)

AP / South China Morning Post ^ | April 5, 2009 | AP

[PGR88]

Lawrence Summers, President Barack Obama's top economic adviser, earned millions over the past year as managing director of the hedge fund DE Shaw Group and through speaking fees, some from financial institutions now at the centre of the government's rescue programme. Financial disclosure reports released by the White House show that Mr Summers received US$5.2 million from DE Shaw. He also reported payments for appearances before firms such as JP Morgan, Citigroup, Goldman Sachs and Lehman Brothers Holdings.

Overall, he was paid US$2.7 million for more than 40 appearances before organisations and firms, including financial institutions.

"Given that Dr Summers is widely recognised as one of the country's most distinguished economists and formerly served as Treasury secretary, there was interest in hearing his economic insights from companies across various industries," White House spokesman Ben LaBolt said.

Mr Obama has enacted strict rules against hiring lobbyists for administration positions that would have influence over their former clients.

A White House official said Mr Summers would not work on issues related to DE Shaw for two years. The official noted that Mr Summers was not an adviser or an employee of the firms that paid him to give speeches.

Another top White House aide, senior adviser David Axelrod, disclosed that he sold his share of two campaign and media strategy businesses last year for US$3 million. The money would be paid to him in annual instalments over the next five years, beginning December.

Mr Axelrod also reported income of more than US$1 million last year from the two firms, David Axelrod & Associates and ASK Public Strategies.

Mr Summers began as managing director at DE Shaw Group in October 2006. A company press release then said he would be involved part-time to offer advice on strategic initiatives, provide high-level research and advise the executive committee. His income from the firm included deferred compensation from 2007 and last year that was paid this year.

[Frantzie]

DE Shaw aka David Shaw engages in shorting as well as going long. Wonder how much he was shorting in October 2007 with maybe Soros, Flowers and John Paulson.

Shaw was one of the hedge funds that got their a*ses kicked by Porsche when the hedgies shorted VW and did not know that Porsche had locked up all the shares on the German options markets. The hedgies lost $8 billion in one day!

They did not know the Herr Doctor CFO at Porsche had run the Stuttgart Options Exchange and knew the ropes. Porsche was trying to buy up VW shares and the hedge funds were screwing with Porsche and betting the deal would noty go through. Porscvhe tore them all a new one. Priceless.

BTW - hedge funds were essentially made illegal after the 1929 market crash. Theywere called investment pools then but they manipulate the markets for profit among other things.

[widdle_wabbit]

Jim Johnson, recently on Obama’s VP search committee, has hauled in millions from his Fannie Mae CEO job. Johnson earned $21,000,000 in just his last year at Fannie Mae.

Mr. Johnson worked an angle with other prominent democrat Henry Cisneros and Countrywide. The operation went belly up.

Henry Cisneros and James Johnson partnered at Lago Vista-KB Homes, Countrywide, Sub-Prime Mortgages

http://topics.nytimes.com/top/news/business/series/the_reckoning/index.html