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Why Merrill Lynch sucks. Even if it doesn't bother you that Merrill Lynch is essentially an unindicted co-conspirator in the Enron mess, sooner or later you will have to sit up and take notice that the world's biggest wealth manager is up to its eyeballs in lending subprime mortgages to delinquent borrowers.

These same subprime mortgages are predicted to take down the markets. ("Subprime will bring down mortgage lending, housing and, in turn, the economy and the market," says Sy Jacobs, Founder and Investment Manager, Jacobs Asset Management, in Barron's.)

And when Merrill Lynch's contribution to the coming Subprime Mortgage Crisis becomes this year's version of yet another Republican-engineered financial crisis (cf. Enron California energy crisis, Poppy's and Neil's S&L crisis, the near-privatization of Social Security, consecutive record federal deficits of Bush 41 and 43, etc.), guess who stands to benefit?

Why, Merrill Lynch's CEO Stanley O'Neal, that's who. This Bush Pioneer stands to personally reap $241 million from his carefully engineered failure, while another government bailout program will have to be devised to counterbalance his brilliant management.

UPDATE: John Aravosis of AMERICABlog is missing the bigger picture when he asks, "Why should I feel bad that you gambled on a mortgage and lost?" The bailout will benefit not the borrowers who were both insanely optimistic and relatively clueless, but the lenders who knew exactly what they were doing all along. For the borrowers, subprime was a gamble. For the lenders, it was a windfall to be followed by a government bailout. For Stanley O'Neal, it's a quarter-billion-dollar bonus.

{ 4:34 PM }

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