BlackWater? Or BlackRock?

No wonder the markets go up everyday. Why not? With these type of puff pastry pieces you ever wonder if we indeed ever had a serious economic crisis.

http://www.vanityfair.com/business/features/2010/04/fink-201004

Has it come to the point that taxpayer freeloaders like Larry Fink of Blackrock need to be thought of like some sort of epic mythic creatures? Where have all of the Cowboys gone? Where are you Joe DiMaggio? Has it come to this point that people who live off of the citizens generosity are thought of as hero's?

Why do we have to keep up the hero worship of these freeloaders?

Besides the trillions in government guarantee's and backstops of toxic mortgage loans, outfits like Blackrock have benefited from numerous highly questionable conflicts of interest combined with a seriously problematic FED and Treasury refusing to disclose critical information about such conflicts. Blackrock has gotten sweetheart deals on both ends and there is to this day not a proper accounting of them. Is this Blackrock or Blackwater we are talking about? We rake David Patterson over the coals but not Geithner or Bernanke? This is absurd.

The article goes in depth about Blackrock's superior modeling skills with their Aladdin program. Again, did these models help them during a crisis? Did they work when they needed to work? The answer is no. Not to pick on Aladdin, but every quant based model took it on the chin, so I don't want to here about the 200MM calculations a week that this thing does. This model was like every other model out there. These models did a great job of measuring day to day risk, and a horrible one of preparing investors for the sort of price movements that will kill investors using leverage during a downturn. The worst part is that its this same model that is being used to analyze the roughly hundreds of billions of toxic loans that Blackrock has been entrusted with by the government. So what we have is less transparency and more complex models that don't work in a crisis.

Another problem I have with this piece is the entire Merrill fiasco. Merrill owned 40% of Blackrock and was swimming in CDO losses. All of this was news to Larry Fink? How can he not know about the garbage that was on Merrill's book? The answer is that Blackrock had the same garbage and it was don't ask don't tell.

The best part is the entire Stuyvesant Town disaster. This so called CMO Genius actually thought that this was a good deal? At the height of the market? He based his assumptions he would be able to kick out rent regulated tenants and raise rents in a environment where real estate prices were soon likely to fall off a cliff?

Aladdin told him to do the deal, that was it. You don't need hundreds of people running thousands of computers churning out millions of calculations to let you know that you were not going to be able to kick out rent regulated tenants.

The question here remains. Where would Larry Fink and Blackrock be without the FDIC? The Fed's ZIRP? Maiden Lane? Treasury? Tax Payers? Why is there not an audit of the fees being handed over to Blackrock?

Articles like this from clueless journalists leave us scratching our heads. If this guy is truly a genius we don't need idiots. Just more of the same stuff rooted in bailout economics based on delusions.