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By Root 2192 0

“With respect to Lehman, GLG last week transferred substantially all of the remaining positions of the GLG Funds to other prime brokers. The majority of these transfers have already settled and we expect the remainder to settle shortly. We believe the residual exposure of the GLG Funds to Lehman will not be material. Lehman is also a shareholder in GLG, owning approximately 33.7 million shares, through Lehman (Cayman Islands), a Cayman Islands company, about 13.7 per cent of the total GLG stock outstanding.”

See note in Chapter 12 on page 245.

“That’s it? That’s fucking it?”: McDonald and Robinson, A Colossal Failure of Common Sense, 314.

“The firm remains committed”: From press release issued by Lehman that morning. “Lehman Brothers Announces Preliminary Third Quarter Results and Strategic Restructuring,” September 10, 2008.

Herlihy had worked on nearly every deal Bank of America had orchestrated: “Bailout Lawyer Optimistic Worst Is Over,” Wall Street Journal Blog/Deal Journal, October 16, 2008.

forecasted a third-quarter loss of $3.9 billion: Ben White, “With Big Loss Forecast, Lehman to Spin Off Assets,” New York Times, September 11, 2008.

“In light of these last two days”: Lehman Brothers preliminary F3Q08 Earnings Call Transcript, September 10, 2008.

“The real estate held-for-sale portfolio”: Ibid.

“To the extent you might need $7 billion”: Ibid.

“The Bungalow”: “HSBC’s Canary Wharf headquarters towers over that of Barclays. So much so that HSBC workers have christened their neighbour’s building ‘the bungalow.’ A spokesman for Barclays retorts: ‘Size is not our objective—growth is.’ Touche.” Dominic Walsh, “Barclays Bungalow; City Diary,” The Times (London), July 8, 2006.

having both vied for the top job in 2003: Grant Ringshaw, “Barclays’ Odd Couple John Varley and Bob Diamond,” Sunday Times, February 17, 2008.

(In 2007, Diamond earned $42 million to Varley’s $8.4 million): “Barclays’ Diamond Gets 21 Million Pounds in Pay and Bonus,” Reuters, March 27, 2008; Ben Livesey and Jon Menon, “Barclays Pays Diamond Five Times More than CEO Varley,” March 26, 2007.

“Bob Diamond 3, John Varley 0”: Ringshaw, “Barclays’ Odd Couple,” Sunday Times.

trying to buy ABN AMRO: After a harrowing nine-month takeover battle, Barclays withdrew its bid of €67.5 billion for ABN AMRO in October 2007, finally conceding to a consortium led by the Royal Bank of Scotland. Julia Werdigier, “Barclays Withdraws Bid to Take Over ABN Amro,” New York Times, October 6, 2007.

been on the phone with Tim Geithner, and Hank Paulson twice about it: From Geithner’s calendar for Wednesday, September 10, 2008.

“Unless I’ve missed something”: Brian Blackstone, “Ex-Fed Official Poole: Fed Not Defining Post-Bailout World,” Dow Jones, September 10, 2008.

Any hope that the SpinCo plan was going to turn Lehman’s fortunes around: Susanne Craig, Randall Smith, Serena Ng, and Matthew Karnitschnig, “Lehman Faces Mounting Pressures,” Wall Street Journal, September 10, 2008.

announced his plans to “retire” from the firm: Mark Kleinman, “Jeremy Isaacs to Step Down at Lehman,” Daily Telegraph, September 7, 2008.

$5 million severance: Danny Fortson, “Five Lehman Chiefs Coop $100m Days Before Collapse,” Sunday Times, October 12, 2008.

“engage in detrimental activity”: From Exhibit A of Lehman’s “Termination Arrangements for Executives” in a section called “Restrictive Covenants.” Document was made public by the House Oversight and Government Reform Committee and is available online under “Materials for Lehman Brothers Compensation Meeting,” http://oversight.house.gov/story.asp?ID=2208.

pocketing some $540 million from an investment in Shinsei Bank: Matthew Miller, “Cash Kings,” Forbes, October 9, 2006.

town house on the Upper East Side for $53 million: Zachery Kouwe, “Sallie’s Suitor—Flowers’ Power: Art of the Deal,” New York Post, October 7, 2007.

Goldfield happened to be the banker depicted: Roger Lowenstein, When Genius Failed, 170–85.

Greenberg bought millions of preferred shares: In June 2008, Lehman sold