Barry Ritholtz drops the stunning news that former Federal Reserve Chairman and exuberant irrationalist Alan Greenspan will have a chair named after him at New York University. (I hope it's a nice chair.)
Curiouser and curiouser is that the endowment is coming from John A. Paulson, Goldman Sachs's partner in the creation of the sucker-baiting "Abacus" mortgage-backed securities.
Nut section discovered by a Ritholtz reader:
"The Stern School will apply $5 million of John Paulson's gift to support two endowed faculty chairs. The first chair is named for alumnus Alan Greenspan (BS '48, MA '50, PhD '77), leading economist and former Chairman of the Federal Reserve Board. Dr. Greenspan was Chairman from 1987-2006, and was the first person to be appointed to five consecutive terms through a period covering four presidential administrations.
Salon's Andrew Leonard points a finger at Paulson: "He is notorious for convincing Goldman Sachs to create such securities, backed by the riskiest mortgages Paulson could identify, simply so he could bet against them—an astonishing act of irresponsibility that succintly captures, all by itself, the moral bankruptcy of Wall Street during the last decade."
Daily Markets' Cam Hui says, "The news of the Alan Greenspan chair at NYU is just another sign of denial."
1. Fer fook's sake, there should be something named for Greenspan at NYU—where, as noted above, Greenspan received his three most important degrees. (News to me: Before that he was a clarinet student at Julliard, but dropped out to tour with Stan Getz! How many millions would be alive today if a time traveler could just go back and convince young Greenspan to live out his jazz/woodwind dreams?)
2. Calling somebody "notorious" is a crafty way of saying "He didn't really do anything wrong, but I disapprove of him anyhow." Paulson may have been mixed up in the story, but he had no moral, legal or even charitable obligation to Goldman Sachs's customers. Goldman may have misled its customers about Abacus, but John Paulson, as I have noted before, is guilty only of gauging the economy accurately—something the government and its various monopoly franchises should have been doing anyway.
3. Never again will I back down when somebody tries to hang this lapsed-Objectivist albatross around the neck of classical economics. Greenwich Village, not Chicago, must answer for Alan Greenspan.
4. It looks like John Paulson's magic touch has gotten soft lately. Ridin' high in April, shot down in May… How can it be? I thought these rich bastards always had everything figured out…