Too Big to Fail [316]
briefed Bush on the Fannie and Freddie situation: Later that morning, at the Department of Energy, Bush said: “I want to thank the members of my economic team for assembling here at the Department of Energy. Secretary Bodman, thank you for hosting us. First of all, Secretary Paulson came by this morning to brief me on the financial markets. Freddie Mac and Fannie Mae are very important institutions. You spent a fair amount of time discussing these institutions. He assured me that he and Ben Bernanke will be working this issue very hard.” Office of the Press Secretary, “President Bush Meets with Economic Team,” July 11, 2008, 11:38 a.m. EDT
Paulson had a call with Sheila Bair: Verified from his calendar.
FDIC was about to seize IndyMac: On Friday July 11, 2008, the Office of Thrift Supervision closed IndyMac Bank, F.S.B, with total assets of $32.01 billion, transferring its operations to the FDIC. “OTS Closes IndyMac Bank and Transfers Operations to FDIC,” July 11, 2008. See http://www.fdic.gov/news/news/press/2008/pr08056.html
“We have a new kind of bank”: James Surowiecki, “Too Dumb to Fail,” New Yorker, March 31, 2008.
“We’re giving serious consideration to becoming a bank holding company: Fuld’s plea to become a bank holding company was first reported by Julie MacIntosh and Francesco Guerrera, “Lehman Failed to Convince Fed Officials Over Survival Strategy,” Financial Times, October 6, 2008; and subsequently reported by Julie Creswell and Ben White, “The Guys from ‘Government Sachs,’” the New York Times, October 19, 2008.
“As long as I am alive this firm will never be sold.”: Susanne Craig, Jeffrey McCracken, Aaron Lucchetti, and Kate Kelly, “The Weekend That Wall Street Died,” Wall Street Journal, December 29, 2008.
he came close to buying Lazard: See Cohan, The Last Tycoons, 517–20.
“You know, I can see why you’re such a shitty M&A banker”: Ibid., 596. Fuld, according to Ken Wilson.
About Greg Curl: Zachary R. Mider, “Lewis Turns to Tomato-Growing ‘Unknown Genius’ on Merrill Deal,” Bloomberg News, September 24, 2008.
“Okay you can fight him”: Daniel S. Morrow, “Kenneth Lewis Oral History,” Computerworld Honors Program International Archives, May 3, 2004. See www.cwhonors.org/archives/histories/Lewis.pdf.
197 “No, we wouldn’t use our petty cash to buy an investment bank”: Heidi N. Moore, “Ken Lewis Tells Investment Bankers All Is Forgiven, WSJ Blog/Deal Journal, June 11, 2008.
Paulson, unshaven and wearing jeans, was pacing the halls and pestering his staff: This scene was first reported by Deborah Solomon, who quoted Wilkinson as saying: “[Y]ou need to leave us alone so we can do our jobs.” Author’s subsequent reporting revealed slightly different wording. See Deborah Solomon, “The Fannie & Freddie Question—Treasury’s Paulson Struggles With the Mortgage Crisis,” Wall Street Journal, August 30, 2008.
take a quick bike ride: Ibid.
“Fannie Mae and Freddie Mac play a central role”: “Paulson Announces GSE Initiatives,” press release, Department of the Treasury, July 13, 2008. See http://www.treas.gov/press/releases/hp1079.htm.
“Our proposal”: “Part I, Part II of a Hearing of the Senate Banking, Housing and Urban Affairs Committee,” Federal News Service, July 15, 2008.
SEC to begin cracking down on improper short selling: The SEC issued an emergency diktat to halt “unlawful manipulation through ‘naked’ short selling,” which was set to start that Monday, July 21, 2008, and expire after thirty days. Kara Scannell and Jenny Strasburg, “SEC Moves to Curb Short-Selling,” Wall Street Journal, July 16, 2008.
Lehman’s board: Dennis K. Berman, “Where Was Lehman’s Board?” WSJ Blog/Deal Journal, September 15, 2008.
Ken Wilson was standing in line at Westchester County Airport: Susanne Craig, “In Ken Wilson, Paulson Gets Direction from the Go-To Banker of Wall Street,” Wall Street Journal, July 22, 2008.
On the evening of July 21 Paulson arrived for a dinner: From Paulson’s July calendar, with dinner scheduled