Jim Chanos, founder of $6 billion hedge fund Kynikos Associates, and billionaire bond-fund manager Bill Gross said they understand the anger directed at financial companies as anti-Wall Street protests spread to Manhattan’s Upper East Side, home of some of the country’s top executives.
Chanos said New Yorkers don’t appreciate the impact government bank bailouts have had on other U.S. citizens. Gross, who runs the biggest bond fund at Pacific Investment Management Co., said today in a Twitter post that wage earners are fighting back after three decades of class warfare in which they were “being shot at.”
“New York is so finance-centric that people here underappreciate the reaction of the rest of the country,” Chanos said today in an interview in New York. “People are angry, they feel the game is rigged, that they didn’t get their fair shake.”
Since Sept. 17, thousands of demonstrators have transformed New York’s Zuccotti Park, near the site of the World Trade Center, into a sea of blue tarps, sleeping bags and tables offering free medical care, food and library books. Gross and Chanos join BlackRock Inc.’s Laurence Fink, who runs the world’s biggest asset manager, and billionaire investor Warren Buffett in expressing empathy with the protests.
Demonstrators in New York today marched to the Upper East Side, home to some Wall Street executives and other wealthy New Yorkers, carrying signs calling for higher taxes on the rich and for U.S. Treasury Secretary Tim Geithner’s firing. The protests drew criticism from John Paulson, the hedge-fund manager who became a billionaire by betting against the U.S. housing market and whose townhouse was among those targeted by marchers.
Paulson Fights Back
“Paulson & Co. and its employees have paid hundreds of millions in New York City and New York State taxes in recent years and have created over 100 high paying jobs in New York City since its formation,” the $30 billion hedge fund said today in an e-mailed statement. “Instead of vilifying our most successful businesses, we should be supporting them and encouraging them to remain in New York City and continue to grow.”
Organizers of the Occupy Wall Street movement said today’s march was a “billionaires walking tour.”
Protesters have criticized the government for propping up hobbled financial giants, including Citigroup Inc. and Bank of America Corp., with a $700 billion taxpayer-funded bailout in 2008, while leaving Americans to struggle with unemployment, depressed wages, soaring foreclosures rates and slashed retirement savings.
Citigroup and Bank of America have since repaid money they received from the government under a program to relieve them of toxic assets.
‘Elderly and Savers’
In Boston, more than 100 people were arrested this morning by police near the city’s financial district where scores have been camping out in tents since Oct. 1 to protest Wall Street policies, according to the organizing group, Occupy Boston.
The arrests followed a march by thousands of students yesterday from Boston Common to the area where the tents are pitched.
Chanos, 53, who was born in Milwaukee, said the “disjointed” nature of the demonstration, which started last month in New York’s financial district and spread to cities such as Washington and Seattle, shouldn’t be underestimated because protests in the sixties started in a similar way.
“The elderly and savers have been hurt by Fed policy,” said Chanos, whose firm is based in New York.
Fink, whose firm has $3.7 trillion under management, said last week he understands the concerns of protesters speaking out against financial companies in New York and other cities.
“These are not lazy people sitting around looking for something to do,” Fink, 58, said on Oct 5 during an event in Toronto. “We have people losing hope and they’re going into the street, whether it’s justified or not.”
Fink received $23.8 million in compensation for 2010, a 50 percent increase from the previous year.
Buffett, chairman of Berkshire Hathaway Inc., said in August that the nation’s richest people have been “coddled long enough by a billionaire-friendly Congress” and called for higher taxes for the “mega-rich” in the U.S.
Buffett, the world’s third-richest man, according to Forbes, told Charlie Rose in New York during a Sept. 30 interview on PBS that class warfare is going on, “and my class isn’t just winning, I mean we’re killing them.”