Too Big to Fail [133]
As soon as they hung up the phone, Jester reported the call to Robert Hoyt, Treasury’s general counsel. With all the conspiracy theories circulating about Goldman and the government, any leaks about the call could be explosive; he needed to cover his ass.
Now it was time to tell Paulson.
At the Lehman tower, Alex Kirk sprinted down the hall to McDade’s office. “Something strange is going on,” he said, catching his breath. “I just got off the phone with Pete Briger.”
Briger, the president of Fortress Partners, a giant hedge fund and private-equity firm, was well wired into the rumor mill, a carryover from his days as a Goldman Sachs partner. He was calling, Kirk recounted, with what sounded like an ominous proposal.
“I know you’re really loyal to Bart and to Lehman Brothers, and I would never make this call in any other circumstance,” Briger had told Kirk. “But if you happen to be taken over this weekend by another financial institution, and you’re not sure whether you want to go work at that financial institution as opposed to Lehman Brothers, I really want you to come talk to me.”
Kirk, taken aback, managed to reply, “I’m flattered,” his mind racing all the while. “I hope that actually doesn’t happen,” he continued. “I didn’t even think you liked me.”
“I was talking to Wes about you the other day,” Briger said, referring to Wesley R. Edens, Fortress’s CEO, “and I said—you know, not that I don’t like you, but I was saying to Wes—‘I would much rather have partners that are really, really smart motherfuckers than guys that I like.’”
Kirk laughed as he related the conversation to McDade, repeating the punchline twice.
But it wasn’t Briger’s backhanded compliment that was the odd part; it was his timing, which could hardly have been coincidental; Kirk was convinced that it was the result of a leak. “Why the hell is he calling me now?” Kirk asked McDade, throwing his hands in the air. Lehman wasn’t in merger talks with anyone, at least not yet.
Then, after McDade stared at him without answering, Kirk answered his own question: “I guarantee they know something that we don’t.”
Jamie Dimon and Barry Zubrow sat in the Anteroom of the Federal Reserve waiting for Chairman Bernanke and his colleagues to appear. Their meeting was scheduled to run from 11:15 a.m. to 11:45 a.m.—which meant that the two JP Morgan officers would have to speak quickly in order to tell the Keeper of the Secrets of the Temple everything they had planned to in the half hour they had been allotted.
Overlooking Constitution Avenue, the Anteroom, despite its name, is a capacious space with thirty-foot-high ceilings standing just off the Board Room, where the nation’s main fiscal policies are hammered out, and steps from Bernanke’s office.
Looking around as he sat waiting, Dimon studied the portraits of all the former Fed chairmen, including Marriner S. Eccles, who was appointed the first chairman of the Board of Governors of the Federal Reserve System in 1934, when he noticed the conspicuous omission of Alan Greenspan among them. “Maybe that’s appropriate,” he joked, given what had been transpiring in the economy. (Greenspan’s portrait had, in fact, not yet been completed.)
Bernanke finally arrived and took his seat. He, too, had just been privately briefed that Lehman might preannounce a staggering loss the following day but had decided that he would keep that news to himself during his meeting with the JP Morgan executives.
Dimon informed Bernanke that they had just come from a visit with Paulson at Treasury, and the conversation turned to the blowback he had been facing for orchestrating the Fannie Mae and Freddie Mac takeover. “The negative publicity is really getting to him,” Bernanke acknowledged of Paulson, who had spoken to him yesterday morning and gotten an earful about the press coverage.
Dimon then launched into his semiprepared remarks, glancing down occasionally at a paper on which he had scribbled some notes during the car ride over.
“There’s a broad lack of confidence out there,” he said.