Too Big to Fail - Andrew Ross Sorkin [330]
Bob Steel had estimated that figure at 12 percent: Speaking at the Lehman Brothers Financial Services Conference on Tuesday, September 9, Steel said Wachovia still expects losses equal to 12 percent, though he said, “it’s still early days.” See “Wachovia Keeps Mortgage Loss View,” stock downgraded, AFX Asia, September 9, 2008.
his firm would not be making any investments: “We won’t be investing in U.S. banks under current circumstances,” Ryosuke Tamakoshi said in Tokyo on Tuesday, September 16, 2008. Takahiko Hyuga, Shingo Kawamoto, and Komaki Ito, “Japan Banks, Insurers Have $2.4 Billion Lehman Risk,” Bloomberg, September 17, 2008.
Gao reiterated his interest in buying 49 percent of Morgan Stanley: Christine Harper, “Morgan Stanley Said to Be in Talks With China’s CIC, Bloomberg, September 18, 2008.
the sale of Lehman Brothers to Barclays: Ben White and Eric Dash, “Barclays Reaches $1.75 Billion Deal for a Lehman Unit,” New York Times, September 18, 2008.
“You may approach”: The dialogue between Judge Peck and Harvey Miller was taken from the official court transcript, dated September 19, 2008.
Merging the “Houses of Morgan”: Chernow, The House of Morgan, 591.
“URGENT and Confidential”: Author obtained copy of e-mail.
chose Roger Altman: Morgan Stanley’s independent board members chose to hire Roger Altman as their adviser, but he only narrowly won the assignment over Christopher Lawrence, a banker at Rothschild.
“Decisions by the Secretary pursuant to the authority”: “Text of Draft Proposal for Bailout Plan,” New York Times, September 20, 2008.
“You know, there’s a chance I could lose this firm”: Mack later recounted this story to Bloomberg: “I said to my wife, when things were really crazy, ‘You know, there’s a chance I will lose this firm. But I would rather be doing this than sitting on a beach reading a book.’” See Lisa Kassenaar and Christine Harper, “Mack Tells Wife He May Lose Firm Before Brokerage Bid,” Bloomberg, January 26, 2009.
the headline “King Henry”: Newsweek, September 29, 2008.
a quote from Governor Jon Corzine: “There hasn’t been a consistent pattern…. We save Bear Stearns but not Lehman. The market is going to have a hard time sorting through what the underlying principle is.” Daniel Gross, “The Captain of the Street; Treasury Secretary Hank Paulson Has a Radical Game Plan for Beating America’s Financial Crisis,” Newsweek, September 29, 2008.
“If you were in your old job”: Tom Brokaw, Meet the Press, NBC, September 21, 2008.
“He understands Berkshire far better”: Buffett, from his 2003 chairman’s letter. See the annual report at http://www.berkshirehathaway.com/2003ar/2003ar.pdf.
it had used Morgan Stanley as adviser: “MUFG’s unsolicited bid, arranged by Morgan Stanley as its financial advisor, also illustrates how conservative Japanese companies are adapting to the cut and thrust of U.S. M&A.” Yuka Hayashi and Alison Tudor,” MUFG offers to buy UnionBanCal,” Wall Street Journal Asia, August 13, 2008.
Mitsubishi agreeing to buy as much as 20 percent: Louise Story, “Morgan Stanley Secures Japan Deal; Mitsubishi UFJ to Pay $9 billion for 21% Stake in U.S. Firm,” New York Times, October 1, 2008.
At 9:30 p.m. the news hit the wires: On September 21, 2008, the Federal Reserve released the following: “The Federal Reserve Board on Sunday approved, pending a statutory five-day antitrust waiting period, the applications of Goldman Sachs and Morgan Stanley to become bank holding companies.” See http://www.federalreserve.gov/newsevents/press/bcreg/20080921a.htm.
CHAPTER NINETEEN
“It would be a grave mistake”: Representative Barney Frank, appearing on Face the Nation, CBS, September 21, 2008.
Trott calling Buffett that Tuesday: Chris Blackhurst, “Billionaire Buffett and the Only Banker He Trusts,” Evening Standard (London), September 25, 2008.
Buffett buying $5 billion in Goldman Stock: Susanne Craig, Matthew Karnitschnig, and Aaron Lucchetti, “Buffett to Invest $5 Billion in Goldman,” Wall Street Journal, September 24, 2008.
Buffett meeting Sidney