Thursday, August 16, 2007

Mortgage Meltdown Mugs Mitt

The victims of the latest hedge-fund meltdown on Wall Street include at least one well-known name: Republican presidential candidate Mitt Romney.

The former Massachusetts governor, who wrapped up a victory in Iowa's symbolic GOP "straw poll" over the weekend, is among the investors hit by the crisis at the Goldman Sachs Global Equity Opportunities fund. That fund needed a $3 billion emergency cash injection to stay afloat this week after losing more than one-third of its value in the market turmoil after the subprime mortgage collapse.

Romney's financial-disclosure form for his presidential run reveals he has a substantial stake in the fund.
The precise size of Romney's investment in the Goldman fund isn't revealed in his filings because the form gives just a range of values and not exact amounts. Based on the range, Romney's investment in the fund is at least $1 million and could be much higher.

The article also points out that presidential candidates have “come to depend on the largesse of Wall Street and the real estate industry,” which leaves me to wonder what if any impact this financial crisis will have on presidential campaigns.

I’d also like to remind everyone that as the stock market continues to sink, there were some people--not me--who advocated investing people’s Social Security in this volatile place. And all I can say is, thank God we don’t have a bunch of retirees who just lost everything in a stock market crash.