Back in October, not long after Lehman Brothers collapsed and triggered a meltdown on Wall Street, one of the hottest e-mail forwards making the rounds among finance types was a letter by Andrew Lahde, a hedge-fund manager who had posted eye-popping 866 percent returns in 2008 by betting on increases in U.S. subprime mortgage defaults. Lahde was getting out on top, and his "So long, suckers!" missive made headlines--partly for his broadsides against predatory lenders, partly for his earnest digression in support of hemp products, and partly for his boasts about getting rich at the expense of Wall Street's "low hanging fruit, i.e., idiots whose parents paid for prep school, Yale, and then the Harvard MBA." These MBA grads, Lahde sneered, "who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government."
And, with that, Lahde had kicked off a new round of scapegoating: What had they been teaching our nation's best and brightest in these MBA programs, anyway? A few days later, the usually prim Financial Times mocked the champagne-swigging alumni at Harvard Business School's 100-year anniversary gala as they quietly squirmed over their responsibility for the mess. By using Office 2007 Professional, you can save your money and time
("We will leave the talk of fixing the blame to others," Harvard's dean assured the gathering.) BusinessWeek piled on, hosting an online debate: "Business schools are largely responsible for the U.S. financial crisis. Pro or con?"
Nowadays, it's getting harder to find a business school professor who isn't agonizing over what Wall Street-bound students might have taken away from their classes. "In a way, finance professors caused this problem--I'm not bragging about this," says Charles Trzcinka, who chairs the finance department at Indiana University-Bloomington's Kelley School of Business. He points out that many of the financial tools that played a starring role in the current crisis, from the countless ways to divvy up and sell mortgage-backed securities to the explosion of credit default swaps, were taught and developed in business schools without, often, a full appreciation for how they could go sour--if, say, housing prices cratered or large counterparties went bust.