The Honorable Thing To Do
Now we have the first Crash of '08 suicide-a French blue blood, who lost a billion investing in Bernie Madoff.I know that people will take grim satisfaction in de La Villehuchet's fate. And maybe they should. Certainly, a dignified suicide is perhaps a better way to go than the way many of Wall Street's fallen have chosen to go, which is: (1) not at all, or (2) pouting before a congressional committee, or (3) staying at least one step ahead of the SEC.
Still, this is a tragedy. He had a wife (don't know about kids), a thriving business. He was a passionate sailor. I'm sure there are people out there who are devastated today. But that brings up a question that has bothered me ever since Bear Sterns imploded. Why didn't these guys (the banking and investing class) act more to protect themselves?
Forget the macroeconomy. Forget the shareholders and bind holders. Forget their fiduciary obligations. Why did they take risks that placed themselves at risk of spectacular losses? These guys had wives, children, employees, and others who were absolutely dependent on them for their support. They were the heads of banks and brokerages that had been built over the span of decades. They had enormous wealth and prestige, and the freedom that comes with such blessings. Jimmy Caynes lost a billion dollars when Bear Sterns died. His story has been repeated thousands of times. Just desserts many would say. Certainly, Pete Seeger is not going to start singing mournful dirges about "The Investin' Man's Hard Times"
Maybe the Fed or the SEC couldn't stop them, but couldn't the sense of self preservation of the investment class have given them pause, so they could stop themselves?
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