No, this is not about Springfield and the Simpsons, or even about Harry Potter. (I don't think he has any Vermont connections, but you never know.) Maybe I should call this post People Magazine--Vermonters involved in multibillion dollar finance edition.
First, if you've been following the meltdown in the subprime mortgage market, you may remember that two very large hedge funds that Bear Stearns ran went belly up a few weeks ago, having bet the wrong way on mortgage defaults. That left Bear Stearns to pick up the approximately $1.6 billion that the funds lost. The funds invested heavily in collateralized debt obligations (CDOs) and were run by Ralph Cioffi, a South Burlington native who graduated from St. Michael's College in the late 1970s. You can read more on the story and Mr. Cioffi here, and here.
Second, if you've been following the possible $5 billion purchase of Dow Jones, owner of the Wall Street Journal, by media tycoon Rupert Murdoch, you'll know that one of the big issues is whether the Bancroft family will sell their shares. The Bancrofts are descendants of the original founders of Dow Jones and, through a very complicated mechanism, own a significant share of Dow Jones stock. One of the members of the Dow Jones board, and part of the Bancroft family, is Elizabeth Steele, of Shelburne. She and Melinda Moulton are the developers of the Main Street Landing project on Burlington's waterfront.
Ms. Steele owns an unknown (but presumably very large number) of shares in Dow Jones, and she's chosen to use some of her wealth to beautify and develop Burlington's waterfront. That's a real asset to Burlington and everyone who benefits from the contribution she's made to the waterfront should thank her.
But that brings up a question: It's highly likely that the Main Street Landing project is not commercially viable. That is, it would not have been developed the way it was if investors needed to receive a competitive rate of return on their assets. What does it say about development and redevelopment in Burlington if the only way it can happen is for investors (or in this case, an investor) to treat investing in the city as a charitable contribution?
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