My new column (actually, it’s laid out in the magazine as a two-page article, but it’s really more like a column) is online and in the issue of Time with Hillary on the cover. It begins:
This story features a man named Prince, an actual (Saudi) prince, a billionaire financial legend, a former Treasury Secretary and a British knight with a German accent. That, plus tens of billions of dollars in losses and a financial crunch that Americans may feel for years.
The man named Prince is Chuck Prince, who lost his job as Citigroup CEO on Sunday, Nov. 4. The immediate precipitating event was $8 billion to $11 billion (they don’t know for sure yet) in fresh losses for his company related to subprime mortgages. Stepping down, Prince said, was the “only honorable course for me to take.” Read more.
Nothing radically new here if you’ve been reading the business news (and in particular Eric Dash in the Times) every day. But the working assumption around here is that most Time subscribers don’t do that. Also, there’s a nice quote about diversification from the Merchant of Venice (brought to my attention years ago by Harry Markowitz) and some gloomy musings about the immediate future of the banking business. Did you know that household debt (as measured by the Fed) rose at almost three times the rate of personal income (as counted by the BEA) between 2000 and 2006? Relying on that to drive your profits is not what you could call a sustainable business model.