Too Big to Fail - Andrew Ross Sorkin [319]
Two documents given to Geithner: Obtained by author from confidential source.
including Rodgin Cohen: Matthew Karnitschnig and David Enrich, “A Lawyer for All Wall Street Navigates Tempestuous Times,” Wall Street Journal, October 9, 2008.
Jester hadn’t been required to sell all his Goldman stock: Greg Farrell and Stephanie Kirchgaessner, “Goldman links to US Treasury Raise Questions,” Financial Times, October 12, 2008.
$3.9 billion loss: On the morning of Wednesday, September 10, Lehman announced its preliminary third-quarter earnings and an estimated net loss of $3.9 billion. See “Lehman Brothers Announces Preliminary Third Quarter Results and Strategic Restructuring,” PR Newswire, September 10, 2008.
“I was talking to Wes about you the other day”: Peter Briger asked to go on the record to state that while he acknowledges this conversation took place and expressed this exact sentiment, he denies ever using the word “motherfuckers.” Based on the author’s sources, Alex Kirk, who is seen by the reader recounting this conversation to Bart McDade, used the word “motherfuckers” in his retelling.
“I would much rather have partners that are really, really smart motherfuckers than guys that I like”: Mr. Briger confirmed making such an observation but disputes using the word “motherfucker” despite the accounts of several other sources who either heard it directly or in the retelling from Alex Kirk after he ran down the hall.
“The stock is coming down.”: Dick Bove to Erin Burnett, Streets Signs, CNBC, “LEH Shares Down,” September 9, 2008.
“This is coming directly from Paulson”: This quote is one of only a few that caused confusion and consternation among various sources. All the sources for this scene agree that this was the comment that McDade made at the time, based on his conversation with Fuld. It is also clear that Paulson spoke to both Blankfein and Fuld about how the two firms should talk to each other and about a sale of Lehman’s real estate assets. It is also clear that David Viniar, Goldman’s CFO, placed a call to Dan Jester earlier in the day seeking help to orchestrate negotiations, which is detailed in an earlier scene. Paulson’s calendar cites a series of phone calls between Paulson and Fuld and Paulson and Blankfein that day, with at least one in rapid succession back to back from each other. Furthermore, multiple sources privy to both of those conversations say that Paulson suggested that Fuld hold discussions with Goldman, as one of many options. So far, nothing is in dispute. What is confusing is why Fuld is under the impression that Goldman is working for the government. There is no evidence that was the case and no evidence that Paulson said so directly. What appears most likely is that there was a miscommunication, with Fuld making certain assumptions and Goldman, during its phone calls with McDade and Kirk, doing little to disavow these views until Wednesday morning, when clarity was required to execute the confidentiality agreement to begin due diligence.
Ken Lewis: Shawn Tully, “Meanwhile, Down in Charlotte…,” Fortune, October 13, 2008.
CHAPTER THIRTEEN
The lead of the New York Times: Jenny Anderson and Ben White, “Wall Street’s Fears on Lehman Bros. Batter Markets,” New York Times, September 10, 2008.
“Some may worry that Treasury”: Ibid.
Wall Street Journal noted: “The firm’s situation differs markedly from that of Bear Stearns, which was taken over earlier this year after it ran into a liquidity crisis. Unlike Bear Stearns, Lehman has access to new Federal Reserve facilities that can provide short-term funding when the markets won’t, in addition to the ability to exchange illiquid assets for safer securities such as Treasurys.” Susanne Craig, Randall Smith, Serena Ng, and Matthew Karnitschnig, Wall Street Journal, September 10, 2008.
reduced the amount of business: On September 16, 2008, GLG Partners issued the following statement regarding Lehman Brothers: