UBS, employer of McCain's economic guru Phil Gramm, takes another subprime hit. Gramm said he didn't know about UBS had subprime holdings.

So much for the theory that the worst is behind us in the first quarter. UBS is writing down an additional $19 billion but they won't be the last to deliver hideous numbers this quarter.

Phil Gramm, McCain's economic guru, is the Vice Chair of UBS -- and he claims he knew nothing about the company's subprime holdings:

The spiraling crisis in the credit and housing markets has kept Gramm in focus, fairly or not. His employer, UBS, revealed yesterday that investment losses tied to the U.S. housing market reached $37 billion over the last six months. For the last three months, UBS posted a $12 billion loss.

Gramm, UBS's vice chairman, said yesterday he was "totally unaware" of his bank's massive holdings of securities tied to subprime mortgages, but, he added, "I'm confident we'll recover."

And, he's going to help McCain run the economy? Gramm's whopper earned him the designation "liar" at The Stump.