Steve Bannon’s “economic nationalist” worldview was shaped in large part by his father losing his nest egg during the 2008 financial crisis — but he blames Wall Street, and not financial experts who encouraged TV news viewers to flee the stock market.
The White House chief strategist was angered after watching his father, Marty Bannon, lose more than $100,000 in AT&T stocks he’d accumulated during a 50-year career with the telecommunications company, reported the Wall Street Journal.
“The only net worth my father had beside his tiny little house was that AT&T stock, and nobody is held accountable?” Bannon said. “All these firms get bailed out. There’s no equity taken from anybody. There’s no one in jail. These companies are all over-leveraged, and everyone looked the other way.”
Marty Bannon, now 95, grew up during the Great Depression and spent five decades working for AT&T, where his own father had worked 48 years.
“I had great faith in AT&T,” Marty Bannon told the newspaper. “At their peak they were the best company for service. That was inbred. Fire, flood, storm or whatever, they called you and you went — whatever time of night — and you stayed out there until the job was finished.”
The elder Bannon was so confident in his employer that he bought up as much AT&T stock as he could, which served as his life insurance, and his children joked that their father — who once aspired to the priesthood — was more likely to leave the Catholic church than sell those shares.
But his confidence was shattered on Oct. 7, 2008, when he watched the plunging stock market pull down his AT&T shares — and he sold his prized stocks for a loss.
The experience turned Steve Bannon, now 63 and a former Goldman Sachs executive, against the political and economic institutions that promoted globalization, which he blames for the market crash.
“I could see his confidence in the system was shattered,” Steve Bannon said. “He was older, in his 80s [at the time]. But all these guys from the Depression, it’s a risk-averse generation because of the horrible things they saw in their youth. He was rattled.”
Goldman Sachs, which Steve Bannon joined after serving in the U.S. Navy, admitted to defrauding customers during the financial crisis as part of a $5.1 billion lawsuit settlement.
The younger Bannon blames Wall Street, but not another institution — TV news and its economic experts — which also relied on his father’s confidence.
The day before his father sold his AT&T stocks, the Journal pointed out, financial analyst Jim Cramer advisers viewers on NBC’s “Today” show to pull their money from the stock market if they expected to need any cash during the next five years.
That’s what Marty Bannon did, and he told the newspaper he lost more than $100,000 on the deal.
“That day, I found out how dumb the people were who I thought were smart,” he said. “They couldn’t control the situation, and it escalated during the day. I said, this thing is going so fast I’m going to be totally wiped out.”
He made the decision without consulting a broker or his family, which includes Steve and another son with investment backgrounds, and his cashed-out shares eventually regained much of their value.
Marty Bannon says he lost more than $100,000 because he sold the shares for less than he paid for them. It was a decision he made without consulting a broker or his family, including his two sons with investment backgrounds, who only learned about the sale days after it was finished. The shares subsequently regained much of their value.
“It wasn’t a winner, so,” Marty Bannon told the newspaper, “shame on me that I made that decision.”