Free Republic

With a great feeling of loss and sadness, I want to join with so many others to mourn the passing of Ted Forstmann, the brilliant financier, entrepreneur, and free-market capitalist. A Wall Street Journal editorial from Paul Gigot and a column by Charlie Gasparino in the New York Post chronicle Ted’s great achievements. It was Ted who invented the leveraged buyout, and it was Ted who walked away from the bubble of overleveraged junk bonds. Ted was a major philanthropist, and an education reformer, too. But Ted also had a spiritual and religious side. He was a weekly Catholic churchgoer,...

...Mr. Forstmann's argument about the present crisis starts with the money supply. After Sept. 11, 2001, the Federal Reserve pumped so much money into the financial system that it distorted the incentives and the decision making of everyone in finance. He illustrates this with what he calls his "little children's story": Once upon a time, when credit conditions and the costs of borrowing money were normal, the bank opened at 9:00 a.m. and closed at 5:00 p.m. For eight hours a day, bankers made loans and took deposits, and then they went home. But after 9/11, the Fed opened the...

One troubling political trend is the proliferation of state politicians who treat private companies as honey pots for their personal ambitions. Last week two of the worst practitioners -- Connecticut Treasurer Denise Nappier and Attorney General Richard Blumenthal -- got a welcome rebuke from a jury of their betters. A six-person Connecticut jury ruled that New York financier Theodore Forstmann and his buyout firm, Forstmann Little & Co., owed the state nothing for having lost $125 million of its money investing in telecom companies. While the jury found them guilty of violating a couple of details of their investment contract...