Page 15 - The Gluckman Occasional Number Three

They were Stern Bears. They frowned when they read the revised
documents. Then Goldinsacks popped out and explained that they
could go into partnership with her and hedge their bet: she would
reward them handsomely to insure those mortgages; property keeps
going up in value, so how could they lose? And to make it even more
certain of success, she would package up the loans and sell them as
AAA securities, while the ratings agencies looked the other way. The
two Senior Bears were thrilled, agreeing that these terms were “just
right,” and danced happily around the table with Goldinsacks. But
the Junior Bear objected: “Our advisor, Mr. Greenpants, told us not
to be irrationally exuberant. This is not ‘just right.’ In fact, it’s just not
right.”
Again, Goldinsacks told the Stern Bears not to worry: if anything
went wrong, her friends in the government and the Federal Reserve
would also look the other way, and then bail her out. “Us, too?”
asked the Bears. “Of course!” beamed Goldinsacks. “Now let’s see
how much money we’ll need to print in case we encounter any little
bumps in the road, like a major market crash.” And she wrote down
three numbers, each with a lot of zeroes at the end. They picked one:
not too big to scare the Chinese, not too small to start a revolution at
home, but right in the middle. They knew the Wisdom of Salomon:
“The economy should not be too hot or too cold, but just right.”
“But how can we get away with keeping most of it?” asked the
Junior Bear. “No problem!” laughed Goldinsacks, her shimmering
hair agleam. “Remember who my friends are: now we’re too big to
fail, so they’ve got to bail—everyone’s blameless! And thanks to
deregulation, we are commercial banks as well as investment brokers:
nobody can stop us now!”
So they made a deal and Goldinsacks sneaked out the back door,
not wanting to be seen conspiring with her business partners. The
Bears were happy, but not as happy as Goldinsacks: she knew she
would get her big bonus, no matter what became of them.