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Paul Krugman: Dan Loeb & Co Are Mad At Obama Because They're A Bunch Of Petty Little Rich Boys

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Last Friday, Third Point founder Dan Loeb released his latest quarterly letter, in which the Third Point founder redirects the feelings he once had for Ken Griffin on the current administration. Paul Krugman read it and he's pretty sure he knows why Loeb and, for that matter, all the other financial services employees who donated to Obama's presidential run have lately been switching teams. Sayeth the Professor:

...they went for Obama because he seemed like their kind of guy, then turned on him with a vengeance because they think he’s looking at them funny. Based on what I know, that’s about right. I talked to some financial-industry backers of Obama back during primary season; they really didn’t know or care much about policy issues, but were in love with Obama over his style — and also over the prospect of being in his inner circle, something they knew wouldn’t happen with Hillary. Now they’re mad because they don’t feel that they’re getting enough stroking.

And you have to bear in mind that this comes after Obama has made immense efforts to placate the financial industry. There were no bank nationalizations; there were hardly any strings attached to bailouts; the financial reform bill was by no means draconian given the scale of the disaster. But Wall Street is furious that Obama might even hint that they caused the crisis — which he does, now and then, because, well, they did.

And as far as I can tell, hardly any of the new anti-Obamanites is thinking at all about what will really happen once John Boehner is speaker. You know, one might have thought that having all the money in the world would make people less petty, less concerned about whether they feel that they’re in the in-group. But nooooo [/Belushi]

We contacted Dan to see if he wanted to confirm or deny whether or not his letter was a result of a lack of "stroking." Reaching him on the beach in Montauk, he told us he had no comment on Krugman's theory but did offer that today was one of his "best surf days of the summer," in case anyone's able to cut out early today.

Earlier From Paul Krugman: Suck It, BusinessWeek (Paulson, Anyone Who Ever Doubted This BSA*)


Paul Krugman Forces Obama Back To The Drawing Board

Sayeth Kruggles: "Yes, I’ve heard about the notion that I should be nominated as Treasury Secretary. I’m flattered, but it really is a bad idea. Part of the reason is that I am indeed the World’s Worst Administrator — and that does matter. Someone else can do the paperwork — but an administrative job requires making hiring and firing decisions, it means keeping track of many things, and that, to say the least, is not my forte...officials inside the administration can of course have even more influence — but only if they’re good at a very different kind of game, that of persuading the president and his inner circle in behind-closed-doors discussion. And everything I know about myself says that I’m not very good at that game. By my reckoning, then, an administration job, no matter how senior, would actually reduce my influence, leaving me unable to say publicly what I really think and all too probably finding myself unable to make headway in internal debates." [NYT]