No price for failure on Wall Street

Alan Schwartz was CEO when Bear Stearns almost took down the global economy. No worries, he's got a new job!


Andrew Leonard
June 2, 2009 6:08PM (UTC)

Alan Schwartz, the last CEO of the defunct investment bank Bear-Stearns, has a new job: Executive chairman at the money management firm Guggenheim Partners.

The Wall Street Journal's Aaron Lucchetti and Kate Kelly explain the significance:

The hiring, expected to be announced on Tuesday, shows that smaller firms that haven't taken government investments are becoming aggressive in looking to take business and talent from once-dominant global banks.

Huh? Alan Schwartz isn't being "taken" from anyone. He's out of a job, because the company he presided over crashed and burned in a stunning display of managerial screw-ups, bad bets on mortgage-backed securities and derivatives, and a shark-like feeding frenzy from its competitors. The only way that paragraph makes sense is if one interprets it as suggesting that Guggenheim prevented other, still-existing "once-dominant global banks" like Citigroup or BofA or Goldman Sachs from nabbing the so-called "rainmaker."

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The Wall Street Journal makes it sound like Schwartz was a hot property, though you wouldn't know it from either of the two books that published in recent months recounting  the story of how Bear Stearns blew up.

One of those books happens to be by the Wall Street Journal's Kate Kelly, in fact. The back cover  introduces readers to "the street fighters of Bear Stearns."

Alan Schwartz, chief executive officer

A career investment banker, Schwartz was at a conference in Palm Beach when the run on his company took off. In the days that followed, he struck outsiders as a "deer in the headlights," unable to employ the savvy deal-making skills he had spent years honing.

A prime catch, indeed!


Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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