Too Big to Fail [327]
portrait of Alexander Hamilton: Andy Serwer, “Mr. Paulson Goes to Washington,” Fortune, November 27, 2006.
Duer could not cover his debts, setting off a panic: Chernow, Alexander Hamilton, 293.
“Free Market Day”: Frank quipped at a hearing held on Wednesday, two days after Lehman filed for bankruptcy. “Barney Frank Celebrates Free Market Day,” Wall Street Journal, September 17, 2008.
Senator Jim Bunning, Republican from Kentucky Ted Barrett, Deirdre Walsh, and Brianna Keilar, “AIG Bailout upsets Republican lawmakers,” CNN.com, September 17, 2008.
Richard Shelby, Republican from Alabama: Ibid.
The Gold Reserve Act of 1934 and Exchange Stabilization Fund: See http://www.treas.gov/offices/international-affairs/esf/.
“DB: A Solid Counterparty”: Aaron Lucchetti, Randall Smith, and Jenny Strasburg, “Morgan Stanley in Talks with Wachovia, Others,” Wall Street Journal, September 18, 2008.
set up a series of phone calls for Mack, who also contacted Chuck Schumer and Hillary Clinton, Cox, Paulson…: First reported by Emily Thornton, “Morgan Stanley’s John Mack Swings into Action,” BusinessWeek.com, September 17, 2008.
“I know all of you are watching our stock price today”: “Morgan Stanley Memo: ‘There Is No Rational Basis for the Movements in Our Stock,’” WSJ Blog/Deal Journal, September 17, 2008.
“This memorandum provides a waiver….”: Author obtained copy of memo.
“Stop the insanity—we need a time out”: Author obtained copy of Schorr’s e-mail.
“It’s one thing to complain”: Susan Pulliam, Liz Rappaport, Aaron Lucchetti, Jenny Strasburg, and Tom McGinty, “Anatomy of the Morgan Stanley Panic,” Wall Street Journal, November 24, 2008.
“Morgan Stanley applauds Attorney General Cuomo”: Press release, September 18, 2008. Find full text in Press section of Morgan Stanley’s company Web site, http://www.morgan-stanley.com.
“There are no atheists in foxholes”: Peter Baker, “A Professor and a Wall Street Deal Maker Bury Old Dogma on Free Markets,” New York Times, September 21, 2008.
Resolution Trust Corporation: Lee Davidson, “The Resolution Trust Corporation and Congress, 1989–1993,” 18, no. 2, FDIC Banking Review, 2006.
L. William Seidman: Greenspan, The Age of Turbulence, 116.
“This new governmental body”: Excerpt of an editorial written by Nicholas F. Brady, Eugene A. Ludwig, and Paul A. Volcker, “Resurrect the Resolution Trust Corp.,” Wall Street Journal, September 17, 2008.
“As Fears Grow, Wall St. Titans”: Ben White and Eric Dash, “As Fears Grow, Wall St. Titans See Shares Fall,” New York Times, September 17, 2008.
“We need a merger partner or we’re not going to make it”: An appended editors’ note in the New York Times on September 17, 2008, said that both Morgan Stanley and Citigroup “vigorously” denied that Mack had ever made this comment.
Sulzberger family pulled its money from Morgan Stanley: Sarah Ellison, “New York Times Controlling Family Moves Assets from Morgan Stanley,” Wall Street Journal, February 3, 2007.
Morgan Stanley’s unfailingly bearish economist: Sarah McBride, “Bearish Economist Roach Says U.S. Caused Global Recession,” Asian Wall Street Journal, July 13, 2001.
George Soros acolyte worth more than $3.5 billion: That week, Stanley Druckenmiller had been ranked 105 on Forbes’s annual list of the four hundred richest Americans, with a net worth of $3.5 billion. “The Forbes 400 List,” Forbes, September 17, 2008.
sent out a companywide e-mail: Author obtained copy of e-mail.
Congress to increase the “debt ceiling” in July: The “debt ceiling” was a political hot potato that would require Congress to vote to increase the amount of debt the country could take on, and Congress had just increased the amount to $10.615 trillion in July.
“The market is trading under the assumption”: “European Shares Rise after Central Bank Plan, Asia Losses,” Agence France-Presse, September 18, 2008.
“The Star-Spangled Banner”: New York Times, October 2, 2008.
FSA announcing temporary ban on short-selling: David Prosser, “Hedge Funds’ Misery as