Revulsion and Amusement

by Steven M. Cohen  •  Jan 4, 2008 at 7:53 am

http://www.buyselljump.com/2008/01/revulsion-and-amusement

First the revulsion: Hillary Clinton gushing about Warren Buffett being her "favorite billionaire."

Ranting to a cheering crowd of 500 about how the tax code is tilted toward the rich, the populist candidate with mansions in Washington and Chappaqua cited a survey Buffett took suggesting that while he pays only 17% of his income in taxes, his secretaries and middle managers pay 25% to 30%.

If Buffett (the outspoken champion of the Draconian and redundant estate tax) finds this so scandalous, perhaps he should just voluntarily pay in more. There probably are no instances of a taxing authority, whether the Feds or states, turning down monies not owed by a taxpayer that he insists on paying.

Or he can just give his employees healthy raises, so that while they will continue to pay a higher percentage than he does, at least they'll have more left over after the tax bite is taken out of them.

Either way could help Buffett assauge his guilt without raising taxes for everybody else. Of course, this probably would do little to satisfy his worshipful friend Hillary, who vows to change the tax code so that "people who make money by making money" (has she forgotten her own deft commodities trading?) pay up just like the little people. Ugh.

And now on to the amusing part. Now that the horses have escaped, the barn has burned down, and the ashes are stone cold, the SEC and FINRA (the Financial Industry Regulatory Authority) are launching big-time investigations into how CDOs and other mortgage-related products were sold to the poor individual investors who got suckered into them.

FINRA in particular is interested in examining the sales practices used to foist this merchandise on unsuspecting seniors. And while we're at it, let's not forget about the great state of Massachusetts, which is launching its own investigation into how one of its mortgage-related investments shrunk from $14 million to $1.2 million in a matter of months.

Investors can rest easy in the knowledge that these vigilant watchdogs are on the case.

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