SALT Conference: Rove and Gibbs Almost Come to Blows

Being a little hung over from last night's terrific Maroon 5 concert, you can forgive me for thinking that I walked into the Roman Coliseum instead of a discussion between Republican mastermind Karl Rove and long time Obama advisor Robert Gibbs at the SkyBridge Capital's SALT Conference. Rove kept hitting Gibbs over the head with the demand that President Obama make a public statement that attacks on Romney's Mormon religion are off limits. Obama has already made a similar statement about the families of candidates.

He said, "The president should tell his followers to stop talking about his weird beliefs and underwear."

Gibbs weakly insisted, "The President never talks about Romney religion."

As a seasoned political observer, the amount of time that Rove spent on the weird Mormonism theme tells me two things. Their polling indicates that Romney is losing lost of votes due to his religion. Even though everyone says the election is about the economy and the room was filled with financial experts, the Republicans really do not have an economic message, except the tired old one of tax cuts.

Rove also wanted to know why the President has not returned the $1 million check of Bill Maher, who has been accused of misogynistic comments.

Gibbs, trying to skirt the issue, answered, "The President condemns those comments." He further asserted that a candidate can not be responsible for all the comments of his supporters.

At the beginning of the session, the two political pros discussed Obama's decision this week to openly support gay marriage.

Gibbs said, "The President has been thinking about this for a long time."

Rove immediately shot down that theory. "The President came out earlier on this issue than he wanted because Biden screwed up, like he always does. He wanted to drag this out for another 18 months for political advantage. This could hurt him among the Catholics, whom are a large part of the swing vote. If he was going to come out, why did he come out the day after the North Carolina vote against gay marriage. The gay marriage advocates there must be asking where was he yesterday."

Both political strategists agree that it will be close election. 7-8% of the voters in 11 swing states will decide the election. Putting it other way,  hundreds of millions of dollars will be spent on advertising to change the minds of a few voters.

Rove surprised me by asking why the American taxpayer should pay for the healthcare of Warren Buffett and Bill Gates. If a Democratic had asked the same question, it would have been called class warfare. His comment indicates the Republicans might be open to having the rich pay their fair share, the four letter word of this campaign.

Gibbs also acknowledged that entitlements will have to be cut.

This round of the "Hunger Games" went to the feisty Karl Rove. The Democrats have to learn to fight with their elbows. Although he had been Obama's press secretary, Gibbs was not effective at delivering the president's message.

Defending Skybridge's"Mooch" Scaramucci from Bloomberg and Reuters

I need to respond to the recent spate of negative publicity received by Anthony Scararmucci, managing partner of Skybridge Capital and founder of the SALT (Skybridge Alternatives) hedge fund conference. Bloomberg's Edward Robinson placed the hatchet squarely in Scaramucci's back. Reuters Felix Salmon followed up  by divulging a petty fight that happened a long time ago.  

Both authors seemed hell bent on badmouthing Scaramucci because he is made millions without seeming to possess any discernible talents but schmoozing. They lament the paucity of his investment talent but forget to mention that he dodged the Madoff, Starr, and Stanford frauds. Robinson glosses over the incredible deal that he engineered to acquire Citigroup hedge fund assets for next to nothing. While Bloomberg (the media outlet) typically glorifies conspicuous consumption, they resent Scaramuuci's charity showboating and extravagant marketing expenditures in this article. 

Robinson sticks it to Scaramucci coming and going. He also hectors him for his lack of billions. He notes that Scaramucci, who collects 1.5% running a fund of funds, is not as rich as his hedge funds colleagues that charge 2/20. 

Scaramucci is a schmoozer extraordinaire, a skill that should not be dismissed lightly. As someone whose take home pay depended on jawboning clients, I can tell you it is a lot harder than it looks and requires more intelligence than you think. Your work is not done when the cocktail party ends.You still need to execute. 

Robinson focused a third of the article on minor failures in Scaramucci's life that occurred over twenty years ago. Spoiled by Mark Zuckerberg and Bill Gates, the media now thinks you are a failure if you are not worth a billion dollars by college graduation. Robinson seems to forget that JP Morgan CEO Jamie Dimon was fired from Citigroup, the late Senator Kennedy was expelled from Harvard, and Mediq terminated US HC founder Len Abramson.

For Salmon, Scarmucci's high crimes and misdemeanors was vigorously complaining aboutan unflattering article about him. The retelling of this ancient incident probably reveals more about Salmon than Scaramucci.

A sense of irritation at the lavishness of the conference emerges from the article by Bloomberg. The article never discloses that they are competitors of Scaramucci since Bloomberg also runs conferences, which are not as good. 

As a frequent conference participant, I appreciated the effort and expense that went into the conference's preparations. Quite simply, the SALT conference is the best conference that I ever attended. Speakers included former President Bush, former Secretary of State Colin Powell, former British Prime Minister Gordon Brown, former Senator Chris Dodd, and Presidential adviser David Axelrod. It was at this conference that former President Bush disclosed his reaction to the capture of Bin Laden. Star economist Nouriel Roubini pontificated, SAC hedge fund founder Steve Cohen whitewashed, Third Point's Daniel Loeb evangelized, and Citadel's Ken Griffin trashed Obama. 

The lineup of illustrious speakers was not what made this conference great. Unlike most investment conferences, this was a conference with a heart. Representatives from various charities such as Wounded Warrior Project and Charity: Water shared stage time with the financial and political luminaries. Generals candidly communicated the current conditions of American troops in Iraq and Afghanistan. 

What both articles did not tell you is that Scaramucci is genuinely a nice guy. Although everyone wanted a piece of him, Scaramucci took the time to hug me hello. (Robinson accurately depicted Scaramucci's love of physicality.) He told that I was "beautiful," which was a total lie, but music to this middle aged lady. This personal gesture was all the more extraordinary since I was an unknown, but clearly not well heeled or well-connected. 

I am not going to defend the fees attached to the fund of funds structure or Skybridge's performance. As an investment professional, I found that it was not always possible to sell clients the product that is best for them. Believe it or not, they often gravitated towards high commission products. The word hedge fund was magical to many and they could not be dissuaded from investing. 

Do not believe everything you hear. Scaramucci may not be perfect, but he is a mensch.