Steve Mnuchin, the Goldman Sachs partner that Trump has chosen as his Secretary of the Treasury, is a very, very lucky man. ProPublica reports that he made a killing during the mortgage meltdown, among many other lucky breaks.

 

Jesse Eisinger writes:

 

The former Goldman Sachs banker nominated to become Donald Trump’s treasury secretary had the perspicacity to purchase a collapsed subprime mortgage lender soon after the financial crisis, getting a sweet deal from the Federal Deposit Insurance Corporation. Now, if he’s confirmed, he will likely be able to take advantage of a tax perk given to government officials.

 

Mnuchin was born into a family of Wall Street royalty. His father was an investment banker at Goldman Sachs for 30 years, serving in top management. He and his brother landed at the powerful firm, too. After making millions in mortgage trading, Mnuchin struck out on his own, creating a hedge fund and building a record of smart and well-timed investment moves.

 

He dodged disaster when he inherited his mother’s portfolio. She was a longtime investor with Bernie Madoff, the largest Ponzi schemer in American history. After she died in early 2005, Mnuchin and his brother quickly liquidated her investments, making $3.2 million. The Madoff trustee, Irving Picard, sued to retrieve the money from the Mnuchins, as he did from other Ponzi scheme winners, contending that they were fake gains. A court ruled that Picard could only claw back money from those who had cashed out within two years before the collapse. The Mnuchins, having pulled out roughly three years before, got to keep their Madoff money. That something was dodgy about Madoff was an open secret on Wall Street.

 

After the financial crisis, the FDIC seized IndyMac, whose irresponsible mortgage loans failed as the housing bubble burst. Desperate to offload the bank, the FDIC subsidized the takeover by sheltering Mnuchin and his team of investors, including hedge fund managers John Paulson and George Soros, from losses. The investors injected $1.55 billion into the bank in 2009. They changed the name to OneWest and five years later, sold it to lender CIT for more than $3 billion, doubling their investment.

 

There is more, much more about Mnuchin’s good luck. If you lost your mortgage and your home when the bubble burst, you were a loser. But Mnuchin was a winner.

 

Some people have all the luck.

 

Trump has put the fox in charge of guarding the hen house.