Bought and Paid For
Page 32
214 Pandit’s heated conversation with Sheila Bair from author’s interviews with people close to the matter and confirmed by Bair’s spokesman.
215 Account of Michael Paese’s comments to Nides from author’s interviews with people familiar with the discussion.
218 Details of SEC charge against Goldman from “SEC Charges Goldman Sachs with Fraud,” Wall Street Journal, April 17, 2010.
219 Bear Stearns’s refusal to package Paulson’s CDOs from Gregory Zuckerman’s The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History, New York, Broad-way Books, 2009.
221 Account of Census Bureau hiring practices from “Census Workers Share Their Horror Stories,” New York Post, June 1, 2010.
222 Account of Dimon nearly punching a senior executive while at Citigroup from author’s interviews with people close to the matter.
222 JPMorgan executives claim that they would not go through with the purchase of Bear Stearns again from author’s interviews with people close to the matter.
224 Dimon’s reactions to criticisms made during JPMorgan’s annual meeting from “Mood Sours in a Year at JPM: Dimon Keeps a Title,” American Banker, May 19, 2010.
226 Account of Obama inviting Bank of America’s Brian Moynihan and not Jamie Dimon to a state dinner from “President Obama Has Party, Does Not Invite Former Best Banker,” New York magazine, May 20, 2010.
227 “The term too big to fail” from “No More ‘Too Big to Fail,’” Washington Post, November 13, 2009.
229 Dimon’s directive to senior JPMorgan staff to begin contributing to the Republican Party from author’s interviews and “Irked, Wall St. Hedges Its Bet on Democrats,” New York Times, February 8, 2010.
232 Citigroup’s, Goldman Sachs’s, and Morgan Stanley’s contributions to the Republican Party from Opensecrets.org.
231 Account of meeting between Wall Street executives and Republican senators Mitch McConnell and John Cornyn from author’s interviews with people present during the meeting.
233 Paul Volcker’s grading of financial reform from “Volcker Pushes for Reform, Regretting Past Silence,” New York Times, July 9, 2010.
234 “As it was with Sarbanes-Oxley” from “The Ugly Truth About Financial Reform,” Daily Beast, July 14, 2010.
235 “The Democrats who wrote the bill” from “The New Lords of Finance: Why Wall Street and Washington Both Like ‘Reform,’” Wall Street Journal, May 24, 2010.
236 “Cheerleaders for” from “Triumph of the Regulators: The Dodd-Frank Financial Reform Bill Doubles Down on the Same System It Failed,” Wall Street Journal, June 28, 2010.
236 “America—and our trading partners—need smart” from prepared testimony of Vikram S. Pandit, chief executive officer, Citigroup Inc., before the Congressional Oversight Panel, March 4, 2010.
Afterword
238 “Wall St. Hiring in Anticipation of an Economic Recovery,” New York Times, July 10, 2010.
239 “An astonishing $1.8 trillion of cash” from “Obama’s CEO Problem—and Ours,” Washington Post, July 5, 2010.
240 Immelt’s description of the business environment in the U.S. as “terrible” from “Immelt Hits Out at China and Obama,” Financial Times, July 1, 2010.
INDEX
ACORN
AIG bailout
Angelides, Phil
Axelrod, David
Ayers, William
Bachus, Spencer
Bailout. See Federal bailout
Bair, Sheila
Bank of America
bailouts
bonus payouts
Moynihan as CEO
postbailout profit
TARP payback by
See also Lewis, Ken
Bear Stearns
and Cayne
collapse of
Bernanke, Ben
Big Government
benefits to Wall St.
defined
See also Federal bailout; Wall Street-Washington connection
BlackRock
postbailout profit
risk management expertise
Blankfein, Lloyd
biographical information
earnings/bonuses
on “God’s work,”
letter to shareholders (2010)
relationship with Geithner
relationship with Obama
ShoreBank rescue
See also Goldman Sachs
Bloomberg, Michael
Boehner, John
Bolten, Josh
Bonds
defined
postbailout profit from
ratings, fictitious
Bonuses
amounts of. See individual companies and CEOs
cap under TARP
Obama’s outrage about
Brown, Scott
Buffett, Warren
Goldman bailout
postbailout profit
Burkman, Jack
Bush, George W.
pro-Wall St. actions
Wall St. rejection of
Campaign contributions
from Wall St., scope of
See also individual companies
Carry trade
Cavanaugh, Mike
Cayne, James
Citigroup
bailout
bonus payouts
contributions to Obama
creation of
failure and Rubin
postbailout profit
ring-fenced assets
TARP payback by
too-big-to-fail status
See also Pandit, Vikram; Rubin, Robert; Weill, Sandy
Citron, Robert
Clinton, Bill
Glass-Steagall repeal by
and housing bubble
and Rubin
Clinton, Hillary, Wall St. opposition to
2008 presidential campaign and
Cohn, Gary
conflict with Reid
as Obama supporter
Collateralized debt obligations (CDOs)
Commercial bank, defined
Commodity Futures Trading Commission (CFTC)
Community Reinvestment Act
Conservatives and right
tax agenda of
Wall St. ties, myth of
See also Republican Party
Cornyn, John
Countrywide Financial
Craig, Greg
Credit-default swap
Cuomo, Andrew
Daley, Bill
Davis, Evelyn Y.
Davis, Steve
Democratic Party
Wall St. donors to
See also Liberals and left
Deregulation
Derivatives
boom in market for
collateralized debt obligations
credit-default swap
defined
See also Mortgage-backed bonds
D.E. Shaw
Dimon, Jamie
and “bankers’ meeting,”
earnings/bonuses
Federal Reserve Board and
financial reform, reaction to
relationship with Obama
too-big-to-fail, criticism of
turns to right
See also JPMorgan Chase
Dinkins, David
Discount window
Dodd, Chris
as banking bill architect
Wall St. contributions to
Emanuel, Rahm
as chief of staff
Wall St. ties
Fannie Mae/Freddie Mac
bailout
functions of
Federal bailout
AIG
bank survival, guarantee of. See Too-big-to-fail
cost of
defined
mark-to-market accounting, relaxing
money-making status quo, preserving
mortgage-backed securities purchase
necessity of
a
nd Paulson
postbailout profit, scope of
TARP
See also Wall Street-Washington connection; individual companies
Federal debt
Federal Deposit Insurance Corporation (FDIC)
Federal Reserve
chairmen. See Bernanke, Ben; Greenspan, Alan; Volcker, Paul
expanded powers of
functions of
and interest rates. See Interest rates
Feinberg, Ken
Financial collapse
blame, accusations of
causes of
and deregulation
and 2008 campaign
Wall St. survival. See Federal bailout; Wall Street-Washington connection
Financial Crisis Inquiry Committee
Financial Industry Regulatory Authority (FINRA)
Financial reform
consumer protection agency proposal
Dodd-Frank bill
effectiveness, speculation on
FDIC authority
Fed, power of
Lincoln proposal
proprietary trading, curtailing
Republican-Wall St. ties, postbailout
systemic risk regulation
Volcker rule
Wall St. reaction to
and Wall St. survival
Fink, Larry
doubts about Obamanomics
as Obama supporter
See also BlackRock
Fitch
Fleming, Greg, as Obama supporter
Forstmann, Teddy
Fortress Capital
Frank, Barney
as banking bill architect
as Wall St. ally
Wall St. contributions to
Freddie Mac. See Fannie Mae/Freddie Mac
Froman, Michael, in Obama administration
Fuld, Richard (“Dick”)
as Obama supporter
See also Lehman Brothers
Gallogly, Mark, and Wall St.-Obama ties
Geithner, Timothy
stabilization plan
as Treasury secretary
Wall St. ties
General Electric, profits after bailout
Gensler, Gary
in Obama administration
Wall St. ties
Gillibrand, Kirsten
Giuliani, Rudy
Glass-Steagall Act
profits after bailout
provisions
renewal proposal
repeal of
Goldman Sachs
Abacus deal
bailout
as bank versus hedge fund
bonus payouts
contributions to Obama
and Greek financial crisis
legal charges against
myth of
postbailout profit
profiteering, PR strategy about
public outrage toward
Rubin at
shorting housing market
TARP payback by
transformation under Blankfein
Volcker rule impact on
Wells notice
See also Blankfein, Lloyd
Gorman, James
earnings/bonuses
See also Morgan Stanley
Government-sponsored enterprises
Grasso, Richard
Greece, financial crisis and Goldman
Green agenda, big business profits from
Greenberg, Alan (“Ace”)
Greenberg, Hank
Greenspan, Alan
federal career of
and Wall St. prosperity
Hall, Andy
Health-care reform
Hedge funds
collapse of
defined
Hedging, defined
Heilemann, John
Housing market
collapse of
and toxic loans. See Mortgage-backed bonds
Immelt, Jeffrey
Interest rates
low, benefit to Wall St.
raising, impact of
Jackson, Jesse
Jarrett, Valerie
Jones, Van
JPMorgan Chase
bailout
Bear Stearns purchased by
bonus payouts
contributions to Obama
Dodd bill, impact on
postbailout profit
profiteering, PR strategy about
TARP payback by
Volcker rule impact on
See also Dimon, Jamie
Kennedy, Teddy
King, Peter
Koenen, Austin
Komansky, David
Langone, Ken
Lehman Brothers, collapse of
liquidation of
Leverage
Levitt, Arthur
Levy, Harold
Lewis, Ken
on postbailout progress
See also Bank of America
Liberation theology
Liberals and left
tax agenda of
Wall St. bias toward
See also Democratic Party
Lincoln, Blanche
Long-Term Capital Management
Ludwig, Eugene
McCain, John
antibank position
Wall St. rejects
McConnell, Mitch
Mack, John
politics and policies of
postbailout high road
retirement of
See also Morgan Stanley
McKenna, Andy
Madoff, Bernie
Maloney, Carolyn
Mark-to-market accounting
Merrill Lynch
Mexican peso crisis
Miller, Paul
Moody’s Investor Service
Moral hazard
Morgan Stanley
bailout
bonus payouts
contributions to Obama
postbailout loss
postbailout profit
public outrage toward
TARP payback by
See also Mack, John
Mortgage-backed bonds
defined
development of
federal purchase of
and financial collapse
resurgence after bailout
Moynihan, Brian
Mozilo, Angelo
Municipal bonds
defined
political connection to
Nanny state
New York City, shady fiscal practices
Nides, Tom
on health-care reform
as Obama supporter
postelection positions
Wall St. ties
Obama, Barack
anti-Wall St. actions. See Financial reform
approval ratings decline
attacks bonuses/Wall St.
and big banks. See Wall Street- Washington connection
as community organizer
economy, approach to. See Federal bailout; Financial reform; Obamanomics; Stimulus package
economy, lack of understanding of
“fat cats” statement
health-care reform
“savvy businessmen” statement
ultraliberalism of
Wall St. contributions to
Wall St. execs in administration of
Wall St. initial contact with
Obamanomics
banking regulation. See Financial reform inequity for middle Americans See also Small business; Unemployment rate
public attacks on
stimulus package, failure of
tax agenda
Wall St. misgivings about
Wall St. profiteering from. See Federal bailout
O’Neal, Stanley
Orange County, Calif., shady fiscal practices
Paese, Michael
Palin, Sarah
Pandit, Vikram
ineffectiveness of
support of financial reform
See als
o Citigroup
Parsons, Dick
Paulson, Hank
as bailout architect
opposition from McCain
Wall St. ties
Paulson, John
Paulson & Co.
Pelosi, Nancy
Perella, Joe
Prince, Charles (“Chuck”)
Proprietary trading, reform of
Reed, John
Regulation. See Financial reform
Reid, Harry
Republican Party
and election 2000
financial collapse, blame on
Wall St. donors to
Wall St. support, postbailout
See also Conservatives and right
Rezko, Tony
Ring-fenced assets
Roubini, Nouriel
Rubin, James
Rubin, Robert
and Citi failure
earnings/bonuses
at Treasury department
Wall St. ties
Run on the bank
Savings and loan (S&L)
Schapiro, Mary
Schumer, Charles (“Chuck”)
Schwarzman, Steve
Securities and Exchange Commission (SEC)
functions of
Goldman investigation
Securities Industry and Financial Markets Association (SIFMA)
Securitization
Seidenberg, Ivan
Shapiro, Mark
ShoreBank, Wall St. rescue of
Shorting, by Goldman
Sidoti, Peter
Simmons, Adele
Small business
Obamanomics, negative impact on
recession, survival tactics
Soros, George
Spector, Warren
fired from Bear Stearns
as Obama campaign worker
as Obama supporter
Spitzer, Eliot
Stamenson, Michael
Standard & Poors
States, stimulus package, failure of
Stimulus package
cost of
failure of
and green agenda
Summers, Larry
as chief economic adviser
and peso crisis
Wall St. ties
Systemic risk
TARP (Troubled Asset Relief Program)
in bailout
bonus cap under
cost of
payback by banks
Taxes
conservative approach
liberal approach
Obama agenda
Tea Party
Thain, John
Too-big-to-fail
and borrowing by banks
and Citigroup