Jon Corzine was many levels above me in the corporate structure at Goldman, but since I worked in the same division, I had some contact with him. He struck me as a decent guy in a place which was full of sociopaths.
At the same time, I thought his reputation for brilliance was overblown. On Wall Street, you can get a reputation for being brilliant by merely making a series of yes/no (buy or sell) decisions which happen to go your way.
Corzine was a big, confident, calm, masculine, charismatic guy who had a knack for making people feel appreciated. He was also obviously very smart. But it was his personality, rather than any creative brilliance, that accounted for his success.
There was certainly no questioning his ambition. He reportedly tired of being a U.S. Senator because he was merely one of a hundred, so before his first term in Washington was up he ran for Governor of New Jersey, a position where he would have much more executive power. More recently he reportedly had his eye on the Secretary of the Treasury position, a post he thought he would get if Obama were reelected.
To that end he seemed to want to make a big splash at MF Global, in order to demonstrate that he still had the magic touch. So he made big bets on European sovereign debt, bets which ultimately bankrupted the overleveraged firm. The big question, of course, is whether he was personally responsible for the missing customer funds.
I'd be surprised if he was, since, as I said, he never gave off the smell of dishonesty while at Goldman. But whether he personally made the decision to take money from those accounts or not is somewhat irrelevant, since as the firm's chief he was ultimately responsible for all decisions made there.
Corzine will probably be sentenced to jail, since politically it would be impossible not to do so. If the customer money is recovered -- and maybe even if it's not -- Obama will probably pardon him, perhaps as soon as January of 2013. Corzine was always a big Obama supporter, and while Obama can no longer offer him Treasury, he still owes him, and Obama is all about paying off old supporters.
But even if Corzine gets off with a short stint in jail, his career is over.
A friend, Dave Moriarty, pointed out yesterday that "you are tempting the trading gods when you name your firm 'MF'."
Corzine didn't name the firm, but he definitely had more than his share of hubris. And as the Greeks told us so long ago, that is the best way to anger the gods.