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The 5 Dumbest Things on Wall Street: Predictions for 2013

1. Hail to the Fab

You must admit that it's been awfully quiet on the Goldman Sachs (GS - Get Report) front since July 2010, when it ponied up $550 million in fines for its mortgage-bond sales practices. Perhaps paying the largest levy in Wall Street history caused the firm to step back and do some soundless soul-searching.

And, yes, they do have souls. They may be devious, rip-your-face-off investment bankers who have no problem selling toxic collateralized debt obligations to widows, Muppets and Belgians, but they are human beings, you know.

Anyway, that reflective period is scheduled to come to a crashing end this coming July when Goldman's star salesman, Fabrice Tourre, goes to trial for his role in the scam. Judging by Fab's e-mails -- like the one where he described himself as "the only potential survivor" of a collapsing CDO market -- we don't think the self-described "Fabulous Fab" will go quietly.

At the same time, we also don't think Goldman CEO Lloyd Blankfein wants to relive the bad old days and see his white-shoe firm dragged through the mud again. Our view is that Lloyd is enjoying the heightened tranquility and relative anonymity now engulfing his firm, not to mention the 46% gain in the company's stock over the past year. Furthermore, we predict that Lloyd will do what it takes to keep things that way.

Quite the conundrum, isn't it? Fab plans to scream to the rafters to save his skin. And Lloyd wants to keep the volume way down low to save his stock.

Fear not. We see a solution and we know that both Fab and Lloyd see it too. And it's good not just for Goldman Sachs, it's good for America too.

How can it not be good for the country if Fabrice Tourre succeeds Tim Geithner to become the nation's 76th secretary of the Treasury?

Doubt all you want, but hand to God, this is going to happen.

To start, Goldman Sachs cranks out Treasury secretaries like Hostess used to make Twinkies. Bob Rubin and Hank Paulson both toiled at 85 Broad Street before moving to the Treasury Building on Pennsylvania Avenue.

How revolving is the door between Goldman Sachs and Treasury? Congressmen were left dumbstruck when soon-to-be retiring Treasury Secretary Tim Geithner revealed to them that he never worked at Goldman Sachs.

So you can check that box, but that's not the only one. Tourre has more than Goldman Sachs on his resume. It turns out that he's a pretty brainy guy, complete with degrees from top French academies including Lycée Henri IV, Lycée Louis le Grand (Sartre attended both of those prep schools) as well as the École Centrale where he received a bachelor's degree in mathematics. And if French schools fail to impress, he's also got a master's degree from Stanford.

Put it all together and Fab's probably better qualified for the job than John Snow was. Seriously, all Snow did was work on the railroad all the live long day. And Fab's certainly got more business experience than Obama's supposed nominee to replace Geithner, Jack Lew. That pencil-pusher has probably never seen a CDO, let alone sold one. Come on!

Anyway, even if Lew does get the job in January when Geithner takes off, both Blankfein and Obama know he's only a placeholder for Tourre. The deal has already been struck and here's how it's going down.

Obama -- a second-termer, mind you -- knows he needs cash for a presidential library back in Chicago and those things cost a lot of dough (just ask Bill Clinton). Furthermore, Obama knows he won't be able to go back to his usual cast of Wall Street backers to foot the bill since they will still be smarting from his recent tax hikes.

Enter Blankfein. He's been smiling broadly of late because he knows the president will soon be facing a cash crunch. And he also knows that he will gladly fund the president's legacy plans if the commander in chief would do him a solid and pull the plug on Tourre's trial.

As for the Fabulous one himself, he completes this circle of favors because we know he wants to be anywhere other than in front of the SEC's attack dogs. In fact, we know firsthand he wants out of the Wall Street rat race.

"People ask me about career advice. I feel like I'm losing my mind and I'm only 28! OK, I've decided two more years of work and I'm retiring,'" wrote Fab, now 33, in one of his infamous e-mails.

You wanted a life of leisure and pleasure, well, you got it, Fab. You're going to Washington DC to serve at the pleasure of the president of the United States care of your old boss Lloyd Blankfein.

Conspiracy theory? We think not. You can count on it.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
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