Why Does UBS Still Employ Phil Gramm?

*this Pubby is at the root of ALL of our problems. Gramm AND his wife, were HUGE supporters of ENRON (wife was on board and never prosecuted). Gramm led the deregulation charge for the banks so they could become a commercial bank and take on more leverage. Then they implode and Gramm is still not prosecuted for his boardship INACTION when UBS reports the highest losses of any bank in this mess. I'd like to know why the SEC hasn't investigated. Gramm and his buddy Rubin (yes they are buddies) should be going to jail along side Bernie. And by the way, who do you think was there when Bernie was helping to create the exchanges?

By Barry Ritholtz - June 30th, 2009, 7:30AM Last week, UBS announced a 2nd Quarter loss “due to restructuring charges.” The banking giant is raising $3.45 billion in a stock sale.

Partly owned by the Swiss government (for years prior to the crisis, if memory serves), UBS was one of the biggest losers in the financial crisis. After a huge expansion into riskiest businesses at the peak of the market, they have had steep losses and enormous write-downs. Since then, they have laid off tens of thousands of workers. (Aside from UBS’ tax problems).

One such worker who has escaped such an ignominious firing is former Texas Senator Phil Gramm. He was hired in 2002 to “advise clients on corporate finance issues and strategy.” This was around the same time that UBS acquired Enron’s energy trading operations. Recall Gramm’s wife Wendy was on the board of Enron, which was up til then the US’s biggest bankruptcy. You can insert whatever revolving door complaint about polticos you want here, but by now its almost besides the point.

Gramm’s position at UBS is “vice chairman” — dubbed “the greatest job in business” for its combination of high status and low work rate. It is a do nothing patronage role that is reward for all the Wall Street friendly legislation Gramm has sponsored. At least, they used to be considered Wall Street friendly, prior to their leading to the Street imploding.

To me, the more significant issue is how respected Gramm’s radical deregulation philosophy was — at least at the time — by the biggest of global investment houses. His philosophy rationalized the irresponsible investing behavior of these big banks.

I almost feel bad for Gramm. His cognitive dissonance and now discredited philosophy must be of little comfort to him in his twilight years.

Meanwhile, plenty of folks at UBS have told me he is an embarrassment to the firm.