In January 2011, Ron Lieber posted “Gordon Murray, Former Investment Banker, Dies at 60” on a blog for The New York Times. Gordon Murray, the investment banker whose conversion to passive investing was the subject of my Your Money column last Nov. 26, died on Saturday at his home in Burlingame, Calif. He was 60 years old and had suffered from glioblastoma, an aggressive form of brain cancer. I first met Gordon when a close friend of his, a financial planner named Dan Goldie, got in touch with me to tell Mr. Murray’s story. Mr. Murray had spent decades at the highest levels of Wall Street, including Goldman Sachs, selling bonds. Many of his clients were managers of active mutual funds or other investors who seek to outperform various market indexes.
“It was six months ago that I was told I had six months to live. One of the good things about having one of these malignant glioblastomas is that you do get some time to get closure, to plan and to spend so much great time with your family and friends.”
“When I entered the business, illegal and unethical were the same. Now there’s a huge difference. Wall Street got much more skilled about crossing the line of illegality.”
In January 2011, Elizabeth MacBride wrote “Reflecting On A Talk With Gordon Murray, Investors’ Advocate and Publishing Phenom” for Forbes Magazine. Gordon Murray died on Saturday in his Burlingame home after a two-year battle with brain cancer. His passing came after years of advocacy of sensible investing, culminating in a book that has become a publishing phenomenon. The 60-year-old began writing, The Investment Answer in earnest this summer after he was given six months to live, in the wake of a scan that revealed his glioblastoma had advanced. He was prodded along with help from his friend and financial advisor, Dan Goldie, 47, who helped organize the project and write the book. See: Two DFA advisors win big book contract after ‘Dying banker’ article in NYTimes.
“You go through an initial period of sadness, but then you realize, ‘Okay, I can't do anything about it, so let's just make the most of what we have.’ I could have a great, quality six months, or I could take the risk with the chemo, the radiation, and all these other drugs they throw in you, but it might actually make things worse.”
The 30-year, fixed-rate mortgage -- the bedrock of American home ownership -- is a weird loan. In an ordinary market, you'd have to pay a really high interest rate to get a 30-year fixed, if you could get it at all. Only the intervention of the government -- and the creation of Fannie Mae -- turned the loan into America's plain-vanilla mortgage. On today's Planet Money, Bethany McLean and Joe Nocera (authors of All the Devils Are Here, a book on the financial crisis) walk us through the 30-year-fixed and the history of Fannie and Freddie. And they talk about where we go from here. Listen to the podcast.
"Too big to fail" is a term of art in regulation and public policy that refers to businesses dealing with market complications related to moral hazard, economic specialization, and monetary theory. Entities are considered to be "too big to fail" by those who believe those entities are so central to a macro-economy that their failure will be disastrous to an economy, and as such believe they should become recipients of beneficial financial and economic policies from governments and/or central banks. Companies that fall into this category take positions that are high-risk, as they are able to leverage these risks based on the policy preference they receive. The term has emerged as prominent in public discourse since the 2007–2010 global financial crisis. Some critics see the policy as counterproductive, i.e. those large banks or other institutions should fail if their risk management is not effective. Moreover, some assert that the "too big to fail" policy has been explicitly refuted in the People's Republic of China, with the bankruptcy of Guangdong International Trust & Investment Corporation in 1998. Some economists, such as Nobel Laureate Paul Krugman don't see it as necessarily a bad thing, with economy of scale in banks, as in other businesses, as worth preserving, so long as they are well regulated, in proportion to their economic clout.
"You shouldn't assume it's correct just because Goldman said it. My brother works at Goldman, and he's an idiot!"
- Joseph Cassano, the head of AIG's financial products unit told the firm's board of directors after being confronted with conflicting valuations from Goldman Sachs
"There aren't enough lifeboats. Someone is going to die. So you might as well enjoy the champagne and caviar!"
- Jamie Dimon, CEO of JPMorganChase, to his staff the night before Lehman filed for bankruptcy
The "Repo Market" - A Repurchase agreement, also known as a Repo or Sale and Repurchase Agreement, is the sale of securities together with an agreement for the seller to buy back the securities at a later date. The repurchase price will be greater than the original sale price, the difference effectively representing interest, sometimes called the repo rate. The party who originally buys the securities effectively acts as a lender. The original seller is effectively acting as a borrower, using their security as collateral for a secured cash loan at a fixed rate of interest. A repo is equivalent to a cash transaction combined with a forward contract. The cash transaction results in transfer of money to the borrower in exchange for legal transfer of the security to the lender, while the forward contract ensures repayment of the loan to the lender and return of the collateral of the borrower. The difference between the forward price and the spot price is effectively the interest on the loan while the settlement date of the forward contract is the maturity date of the loan.
Stanley Druckenmiller, a George Soros acolyte who's worth more than $3.5 billion, approached Goldman Sachs co-president Gary Cohn about withdrawing millions invested with the bank. “Look, the one thing I’m doing is I’m learning who my friends are and who my enemies are, and I’m making lists.” Cohn said. Druckenmiller replied, “I don’t really give a shit—it’s my money! It’s my livelihood. I’ve got to protect myself, and I don’t really give a shit what you have to say.”
In November, 2009, at around the publishing of the Andrew Ross Sorkin book, Too Big to Fail, Gabriel Sherman wrote "The Information Broker" for New York magazine, about how Andrew Ross Sorkin, himself, is "too big to fail" in the eyes of the company that he works for: For journalists, bad news can be good news. And so, in the wake of the Lehman Brothers collapse last September, as the world’s economy teetered, an all-star roster of business journalists—Roger Lowenstein, Joe Nocera and Bethany McLean—raced to shop book proposals to chronicle the epochal events unfolding on Wall Street and in Washington, D.C. On the morning of September 23, 2008, Andrew Ross Sorkin, the New York Times’ then-31-year-old star financial reporter, made the rounds to publishers with his agent and his proposal, which he’d pulled together over a weekend. “It was like Paulson’s original tarp proposal,” Andrew Ross Sorkin tells me, referring to the former Treasury secretary. “His was three pages, mine was three pages.” We’re sitting at the Lyric Diner on Third Avenue on a Monday morning. Sorkin’s Tuesday Times column is due in a few hours, but, as usual, he’s way behind, and later I learn that he missed it entirely and his editors had to scramble. His excuse is that he’s got a book, Too Big to Fail, to promote. Too Big to Fail, for which Viking paid a reported $700,000 and which debuted at No. 4 on the Times’ best-seller list, is a nearly minute-by-minute account of the financial crisis as observed through the eyes of the clashing Wall Street CEOs who drove their investment banks into the abyss and the government regulators who watched powerless from the sidelines. The book has become a kind of media sensation. In a review for the Financial Times, John Gapper declared that Andrew Ross Sorkin had written this generation’s Barbarians at the Gate. Charlie Rose compared Sorkin to Bob Woodward. Vanity Fair published an excerpt and held a book party at Graydon Carter’s Monkey Bar (“Part of the package we put together for him,” Carter says). Three weeks ago, as the book landed in stores, Sorkin blanketed the airwaves, beginning with an October 19 appearance on the Today show, followed by multiple stops on CNBC and his second appearance in a month on Charlie Rose. “I’m very surprised by the reaction,” Sorkin explains, as we sit over bowls of oatmeal at a rear table. “But it’s good! I can’t complain.” Despite the highs of the past week, Andrew Ross Sorkin looks exhausted. He’s eschewed his usual Ted Baker suits—“You have to dress like them,” he says of his cast of sources—for jeans, a striped blue shirt, and a blazer. At a particularly loud moment in our interview, when he picks up my digital recorder and holds it to his mouth, he looks like a CEO dictating notes to himself.
"So I'm the schmuck?" said Richard Fuld, CEO of Lehman Brothers, after he realized Bank of America would likely drop its bid to buy the firm.
"I'm certain you'll spark a fuckin' panic..." Timothy F. Geithner, then the president of the New York Federal Reserve, to Henry M. Paulson, on disclosing his $700 billion bailout plan without first preparing Congressional leaders.
In May 2010, James Pressley wrote “Sorkin’s ‘Too Big to Fail’ Is Finalist in Samuel Johnson Prize” for Bloomberg, in which he reported: The new Andrew Ross Sorkin book, “Too Big to Fail” made the final round in the BBC Samuel Johnson Prize, an annual U.K. nonfiction award worth 20,000 pounds ($28,650) to the winner. Sorkin’s cinematic reconstruction of how Wall Street and Washington struggled to save the financial system will compete against an eclectic mix of titles on topics ranging from mathematics and fishing to King Charles II of England and the brutalized lives of North Koreans, the organizers said in an e- mailed statement. Billed as the U.K.’s richest award for the genre, the Samuel Johnson Prize is sponsored by the British Broadcasting Corp. This year’s selection of finalists defies categorization, said the chairman of the judging panel, economist and Radio 4 presenter Evan Davis. “Perhaps the only common feature of these books is the passion and sheer enthusiasm of the authors for their subjects,” Davis said in the release.
"When I picked up my newspaper yesterday, I thought I woke up in France."
- Senator Jim Bunning to Henry M. Paulson after the Treasury sought authority to invest in Fannie Mae and Freddie Mac
"The money’s walking out the door."
- Morgan Stanley President Walid Chammah, the day investors withdrew $20 billion from the bank
"What the fuck was that all about? Was he offering to merge with us?" Morgan Stanley CEO John Mack after a meeting with Lehman executives at his house.
In March 2010, Mike Fleming reported “HBO To Make Financial Collapse Drama From NY Timesman's 'Too Big to Fail” for Deadline.com: An HBO movie about the 2008 financial meltdown is finally moving. HBO has acquired rights to Too Big to Fail, the bestselling book by New York Times reporter Andrew Sorkin. Peter Gould has been hired to write the drama, and Spring Creek’s Paula Weinstein and Jeffrey Levine are executive producers. The project has been slow going because it was first set up with a book co-written by Andrew Sorkin's Times colleague Joe Nocera and Vanity Fair writer Bethany McLean, and they haven't turned in their manuscript. HBO execs say they will marry the source materials to chronicle the financial crisis the same way that Recount dissected the disputed Florida results in the 2000 presidential election. For his part, Andrew Sorkin says his book lends itself well to that task. He focused specifically on players like Treasury Secretary Hank Paulson and his successor Timothy Geitner, Lehman Bros CEO Richard Fuld, and Federal Reserve chairman Ben Bernanke, in boardrooms, private planes and bedrooms as the financial system teetered on the brink of collapse. “You see their human sides, the hubris, the ego,” Andrew Ross Sorkin said. “You see Hank Paulsen literally vomiting and Dick Fuld crying with his wife as their world fell apart."
Legendary Blackstone co-founder Peter G. Peterson was stunned by Timothy Geithner's youthful appearance when he first met him, later telling Larry Summers: "He's twelve years old!"
In December 2009, Stephen Foley wrote a review for The Independent: Too Big to Fail rips along at such a pace that even the reader is hard-pressed to stop and ask the what ifs. While no one can be happy that the tale ends with taxpayers paying hundreds of billions of dollars to prop up failed banks and fallible bankers, there are few signposts to better outcomes. That the US Treasury secretary came from Goldman, and didn't have to learn the intricacies of derivatives trading on the job, seems a blessing, rather than the curse many now suggest. It was bad enough that the head of the Securities and Exchange Commission, a former Congressman called Christopher Cox, appears "cryogenically frozen" in fear; how much worse if all the president's men had been the same? Journalists are normally content to write the first draft of history, but Ross Sorkin, mergers and acquisitions reporter for the New York Times, is performing well above his pay grade. He has augmented 500 hours of interviews with 200 participants with access to their email and phone records, private notes and even expenses forms. Too Big to Fail stakes a good claim to being the definitive story of our once-in-a-lifetime crisis.
Andrew Ross Sorkin (born February 19, 1977) is a Gerald Loeb Award-winning American journalist and author. He is a financial columnist for The New York Times and is the newspaper's chief mergers and acquisitions reporter. He is also the founder and editor of DealBook, a financial news service, published by The New York Times. Andrew Sorkin graduated from Scarsdale High School in 1995 and earned a a Bachelor of Science degree from Cornell University in 1999. Sorkin first joined The Times during his senior year in high school, as a student intern. He also worked for the paper while he was in college, publishing 71 articles before he graduated. He began by writing media and technology articles while assisting Stuart Elliott, The Times' advertising columnist. Andrew Sorkin spent the summer of 1996 working for Business Week, before returning to The Times. He moved to London for part of 1998. While there, he wrote about European business and technology for The Times, and then returned to Cornell to complete his studies. Sorkin joined The Times full time in 1999 as the newspaper's European mergers and acquisitions reporter, based in London, and the following year became The Times' chief mergers and acquisitions reporter, based in New York, a position he still holds. In addition, Andrew Sorkin started his financial-news website and email newsletter, DealBook, which he continues to edit. He writes a column by the same name (since April 2004) in the Tuesday editions (initially in Sunday editions). Andrew Sorkin also holds the title of assistant editor of business and finance news.
The Andrew Sorkin book on the Wall Street banking crisis, Too Big to Fail, was published by Viking October 20, 2009. The book won the 2010 Gerald Loeb Award for best business book of the year, was on the shortlist for the 2010 Samuel Johnson Prize, shortlisted for the 2010 Financial Times and Goldman Sachs Business Book of the Year Award, and was on The New York Times Best Seller list (business) for 6 months. Filming began on the HBO production on October 22, 2010 with director Curtis Hanson at the helm. The A-List cast includes Paul Giamatti as Ben Bernanke, William Hurt as Hank Paulson, Billy Crudup as Timothy Geithner, Dan Hedaya as Barney Frank, as well as Topher Grace as Jim Wilkinson (former U.S. government employee). The expected release date is unknown at this time, but expectations are no later than early 2012. Andrew Sorkin also won a Society of American Business Editors and Writers Award for breaking news in 2005 and again in 2006. In 2007, the World Economic Forum named him a Young Global Leader. Also in 2007, SiliconAlleyInsider.com named Sorkin one of New York's "most influential scribes." In 2008, Vanity Fair magazine named Sorkin as one of 40 new members of the "Next Establishment." Andrew Sorkin is also recognized as one of Scarsdale High School's Distinguished Alumni.
Lords of Finance by Liaquat Ahamed is a 2009 nonfiction book about events leading up to and culminating in the Great Depression as told through the personal histories of the heads of the Central Banks of the world's four major economies at the time: Benjamin Strong Jr. of the New York Federal Reserve, Montagu Norman of the Bank of England, Émile Moreau of the Banque de France, and Hjalmar Schacht of the Reichsbank. Liaquat Ahamed's book was generally well received by critics, and won the 2010 Pulitzer Prize for History. Because Lords of Finance was published during the midst of the financial crisis of 2007–2010, the book subject matter was seen as very relevant to current financial events. One of the main themes of the book is the role played by the central bankers' insistence to adhere to the gold standard "even in the face of total catastrophe." As Joe Nocera, a book reviewer at the New York Times, stated, "the central bankers were prisoners of the economic orthodoxy of their time: the powerful belief that sound monetary policy had to revolve around the gold standard...Again and again, this straitjacket caused the central bankers — especially Norman, gold’s most fervent advocate — to make moves, like raising interest rates, that would allow their countries to hold on to their dwindling gold supplies, even though the larger economy desperately needed help in the form of lower interest rates." Another theme that runs through the Liaquat Ahamed book is how difficult it was to forecast the financial future and how the events would influence world events. "The opinions of Liaquat Ahamed are made very clear (the Paris Peace Conference’s plan for Germany to pay war reparations is presented as a great blunder), but his overriding idea is that blame cannot be easily assigned: not even the most sophisticated economists of the era could accurately predict disaster, let alone guard against it. The effects of a public herd mentality at the time of the 1929 stock market crash are depicted, all too recognizably, as unstoppable."
“We have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand.”
- John Maynard Keynes
"Flying Blind" by Joe Nocera for The New York Times: You read the Liaquat Ahamed book's sections on reparations — and there are lots of them because the issue dogged the world for more than a decade — with a growing sense of horror, knowing how it all turns out. But you also read Lords of Finance with a growing sense of recognition. As you learn how the world spiraled into depression, about the interconnectedness of the banking system, where a failure in one country led to problems in other countries, about the way economic orthodoxy caused brilliant central bankers to make mistake after mistake, and on and on — you can’t help thinking about the economic crisis we’re living through now. The central bankers of the 1920s and ’30s were flying blind; Liaquat Ahamed's Lords of Finance makes that quite clear. They could only hope the moves they made would help the economy instead of hurting it. Sometimes they were right, but often they were wrong. We like to think that today we have a better grasp of the machinery that moves an economy — but do we? Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Henry Paulson were much quicker than the earlier lords of finance to throw money at the banking system to prevent it from collapsing, a lesson they learned from the inaction of the Federal Reserve in the 1930s. But Paulson also allowed Lehman Brothers to default, an event that set off a contagion of failure around the world. Here at this critical moment, with a new administration having just taken office, and with so much riding on its policy responses to the current crisis, “Lords of Finance” poses an unsettling question. Do we really understand the workings of that delicate machine any better than our forebears did? Or do we only think we do?
"Pride Before the Fall" by Richard Lambert for the Guardian: The world's four most important central bankers, the principal characters of Liaquat Ahamed book, "Lords of Finance," recognised the political blunders of the peace process and did what they could to deal with the consequences. But more than anyone else, they were also responsible for the second fundamental error of economic policy - the decision to return to the gold standard, at the wrong time and the wrong rate. The Bank of England's Montagu Norman was the first among equals. In the words of his French counterpart, he appeared "to have stepped out of a Van Dyck painting, elongated figure, pointed beard, a big hat ... Very mysterious, extremely complicated, one never knows the depths of his thoughts". Norman saw a return to the gold standard at the prewar rate as a matter of national pride, a moral commitment to those who had placed their assets and their trust in sterling. He could not accept the idea that the City of London should play second fiddle to anyone in the global capital markets. Short-term economic pain would be worth the financial long-term gain. Making up the quartet of central bankers were Hjalmar Schacht of Germany - a man with an extraordinary capacity for making enemies, whose prominent support for the Nazi party was to take him all the way to the Nuremberg trials - and the wily Emile Moreau of France. Unlike Schacht, he was not close to Norman and the distrust was mutual. A Bank of England note-taker at their first meeting observed that he was "stupid, obstinate, devoid of imagination and generally of understanding, but a magnificent fighter for narrow and greedy ends". Then there was John Maynard Keynes - incisive, hostile to those who attacked "the problems of the postwar world with unmodified prewar views and ideas", and almost always ignored. One of the great set pieces of the Lords of Finance is a dinner at 11 Downing Street in March 1925. Chancellor Winston Churchill is trying to make up his mind about the gold standard: Norman, whom Churchill could not stand, is not invited, so senior treasury officials argue his corner. Keynes makes the case against gold, but tragically is not on best form. As the night wears on and the alcohol flows, Churchill is swayed by the idea that failure to act would be seen as a public admission of Britain's diminished role in the world. The final word of the night goes to Reginald McKenna, a banker and former Liberal chancellor. "There is no escape. You will have to go back; but it will be hell." The price of that dinner was economic catastrophe - first in Britain and then more generally. The world's gold reserves were inadequate to take the strain. Because sterling had gone in at the wrong rate, the Bank of England was under constant pressure and Britain's manufacturers were priced out of their export markets. Liaquat Ahamed argues that the four central bankers were able to keep the show on the road only by holding US interest rates down and keeping Germany afloat on borrowed money. The Fed was torn between two conflicting objectives: to keep propping up Europe by cutting interest rates, or to control speculation on Wall Street by raising them. It was a system that was bound to come to a crashing end.
"More than anything else, more even than the belief in free trade, or the ideaology of low taxation and small government, the gold standard was the economic totem of the age. Gold was the lifeblood of the financial system. It was the anchor for most currencies, it provided the foundation for banks, and in a time of war or panic, it served as a store of safety. For the growing middle classes of the world, who provided so much of the savings, the gold standard was more than simply an ingenious system for regulating the issue of currency. It served to reinforce all of those Victorian virtues of economy and prudence in public policy. It had, in the words of H.G. Wells, "a magnificent stupid honesty" about it."
- Liaquat Ahamed, Lords of Finance
"Who Caused the Great Depression?" by Frank Ahrens for the Washington Post: Until last year, few believed anything would stop U.S. homes from going up in value 10 percent every year. That is, until the sub-prime mortgage crisis exploded. Likewise, in the prosperous and interdependent Europe of 100 years ago, war was considered unthinkable because it would destroy all. By 1917, an entire generation of young male university graduates was dead. And, frankly, the brainpower needed for forward-thinking was lacking. European bankers of the time carried a cavalier ignorance of economics, and that goes double for America's first Federal Reserve directors. The science of monetary policy was still in its infancy, and no one could have expected four dreary bankers to turn suddenly into brilliant, ahead-of-their-time economists. That role should have fallen to John Maynard Keynes, one of the few heroes of the Liaquat Ahamed book, Lords of Finance. Keynes called the gold standard a "barbarous relic" and clearly explained its limits; in 1925, he accused the British banking elite of "attacking the problems of the post-war world with unmodified pre-war views and ideas." But despite being a well-known Cambridge don, Keynes was an outsider, not a member of the world's most exclusive club, and those in power largely ignored his warnings. Looking at the events of the 1920s and 1930s, one wonders: Could a modern confluence of catastrophes cause another global depression? No major power is likely to return to the gold standard, so that risk is off the table. But is there a comparable systemic problem today, something we refuse to see? Liaquat Ahamed thinks we're plain lucky that recent financial crises -- in Mexico in 1994, Asia and Russia in 1997-98, the United States beginning in 2007 -- "have conveniently struck one by one, with decent intervals in between." After reading his bracing book, one can only hope that our economy is in the hands of decision makers who are more numerous, less powerful or much wiser than in the past.
From the book's promotional website: Greg Farrell is a correspondent for the Financial Times. In January 2009, he broke the news that Merrill Lynch had paid out its 2008 bonuses a month ahead of schedule, in December, even though Merrill was in the process of losing $28 billion for the year, and Bank of America needed an extra $20 billion in taxpayer funds to complete its acquisition of the firm. That story sparked an investigation by New York attorney general Andrew Cuomo. Greg is a past winner of the American Business Press’s Jesse Neal Award for investigative reporting and a recipient of the Knight-Bagehot Fellowship for business journalism. He earned a BA from Harvard University and an MBA from the Graduate School of Business at Columbia University.
The author was recently quoted as stating that the United States' Federal Reserve Bank was acting, in fact, as the world's central bank; this is a relatively straight forward notion, and actually rather self evident when you think of the greenback as the world's base currency (in terms of volume and stability and liquidity, and in terms of currency reserves held by sovereign banks). In the Sun Herald, Bradley Keoun and Hugh Son invoked the author this way: “Things would have been worse if they hadn’t lent to foreigners,” said Perry Mehrling, senior fellow at the Morin Center for Banking and Financial Law at Boston University and author of “The New Lombard Street: How the Fed became the Dealer of Last Resort.” “We’re finally getting to understand the role of the Fed in the world.” Fed spreadsheets showed the central bank became the world’s lender of last resort as dollars flowed to European banks as well as Bank of America Corp. and Wells Fargo & Co, among top borrowers from the Term Auction Facility at $45 billion each.Read that Sun Herald piece here. Recently, the author was a guest on Bloomberg Radio; download the podcast of that show here.
In December of 2010, Seeking Alpha, a premium financial newsletter, wrote this about the book and author: Don't Count on It!: Reflections on Investment Illusions, Capitalism, "Mutual" Funds, Indexing, Entrepreneurship, Idealism, and Heroes (Wiley, 2011) is an anthology of recent writings and speeches by John C. Bogle, the venerable founder of Vanguard. It is a substantial book, over 600 pages long, and, as its subtitle indicates, covers a range of topics. Here I'm going to confine myself to two. I'll begin by exploring three principles that underlie Bogle's well-known case for low-cost passive index funds. Then I'll jump to the lecture he gave to the Risk Management Association in October 2007: "Black Monday and Black Swans."Read the full review and article here. The WNYC Radio program, The Brian Lehrer Show, recently aired a show, "Vanguard of Finance," in which the author was a guest. See also: Common Sense on Mutual Funds: Fully Updated 10th Anniversary Edition, The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits), Enough: True Measures of Money, Business, and Life.
CHARLIE ROSE: Steve Rattner is here. He was the leader of President
Obama’s taskforce on restructuring the automobile industry in the wake of
the financial crisis. That effort became the largest government
intervention in industrial America since World War II. Steve writes about
this experience and more in "Overhaul: An Insider’s Account of the Obama
Administration’s Emergency Rescue of the Auto Industry." I am pleased to
have him back on this program. He used to be the chairman of the board of
Channel 13, our sponsoring station here. He’s a long time friend of mine
and supporter of this program. And I should say that to you in full
disclosure and I’m deeply appreciative of the support of Channel 13 and
Steve for this program. Having said that, let’s talk about you.
Maria Bartiromo, CNBC anchor, discusses her new book The Weekend That Changed Wall Street: An Eyewitness Account and what's it's been like covering the financial meltdown. → Event: Maria Bartiromo will be signing her new book tomorrow, September 8th, at the Wall Street Borders Book Store.
October 13, 2010 - Austan Goolsbee Views: 158,329 Aired: 10/13/10 Episode 06132 Stephen questions whether it's fair to tax the rich, and Austan Goolsbee gives Obama economic advice.
Chris DeSimio is On the Money with NBC' Today Show financial editor Jean Chatzky about her new book, Not Your Parent's Money Book, a book primarily for kids but will also help parent's teach their children about money.
September 29, 2010 - Steven Rattner Views: 135,162 Aired: 09/29/10 Episode 06124 The koala population suffers from Chlamydia, and Steven Rattner discusses the auto industry bailout.
CHARLIE ROSE: Tuesday marks the second anniversary of the fall of
Lehman Brothers, the event that helped create the deepest recession since
the Great Depression. In July President Obama signed into law
comprehensive financial regulation to prevent the next economic crisis, but
worries about rising unemployment and the threat of a double dip recession
have taken precedence, leading to the midterm elections.
In a move to stimulate the economy President Obama’s proposed
extending the Bush tax cuts to individuals makes less than $250,000.
Midterm elections are now less than two months away, and this week President Obama’s agenda is all about the economy. In Milwaukee on Monday, the president said, “I am going to keep fighting, every single day, every single hour, every single minute, to turn this economy around, and put our people back to work.” [...] We talk about the president’s new proposals with Andrew Ross Sorkin, chief mergers and acquisitions reporter for our partner, The New York Times. He is also the editor and founder of DealBook, an online daily financial report, and the author of the book “Too Big to Fail,” which is out in paperback this week. Richard Copeland also joins us; he is the founder and owner of THOR Construction, the country’s largest African American owned construction company.
CHARLIE ROSE: In 1949, Alfred Winslow Jones scraped together $100,000
to set up the first hedge fund. Sixty years later in 2009, the top 25
hedge fund managers earned a collective $25.3 billion.
Sebastian Mallaby’s new book called "More Money than God" argues the
future of finance lies in the history of hedge funds. Mallaby is a senior
fellow for International Economics and he’s a columnist in for the
"Washington Post." I’m pleased to have him here at this table. Welcome.
In his new book, "The Big Short: Inside the Doomsday Machine," Michael Lewis tells the story of several key players in the subprime mortgage crisis who understood what was happening to the market and were able to make huge amounts of money in the transactions. He is also the author of "The Blind Side" which was the basis of a 2009 movie that won Sandra Bullock an Academy Award for Best Actress. He is also a contributing editor at Vanity Fair.
Can we avoid black swans? Ken Posner -- veteran Morgan Stanley (NYSE: MS) securities analyst and author of the book Stalking the Black Swan: Research and Decision-Making in a World of Extreme Volatility-- says, "Yes." Posner states, "Volatility results from market economies, global capital flows, and information technologies and is necessary for innovation and progress. Rather than wishing volatility away, we need to design a financial system that is more robust in the face of extreme volatility, and refine decision-making techniques to account for the risk of Black Swan events."
In the midst of a floor speech on regulatory reform, Senate Majority Whip Dick Durbin (D-Ill.) interrupted himself for a sort of commercial announcement. “I’m going to plug a book: Michael Lewis’s ‘The Big Short.’” While debating changes to Fannie Mae and Freddie Mac, Senate Banking Committee Chairman Chris Dodd (D-Conn.) told his colleagues: “Read this new book, ‘The Big Short.’” Senate Majority Leader Harry Reid (D-Nev.) was decrying Republican obstructionism on the floor when he said, “I recommend everyone within the sound of my voice to read the book.”
, Gabriel Sherman wrote "The Information Broker" for New York magazine, about how Andrew Ross Sorkin, himself, is "too big to fail" in the eyes of the company that he works for: For journalists, bad news can be good news. And so, in the wake of the Lehman Brothers collapse last September, as the world’s economy teetered, an all-star roster of business journalists—Roger Lowenstein, Joe Nocera and Bethany McLean—raced to shop book proposals to chronicle the epochal events unfolding on Wall Street and in Washington, D.C. On the morning of September 23, 2008, Andrew Ross Sorkin, the New York Times’ then-31-year-old star financial reporter, made the rounds to publishers with his agent and his proposal, which he’d pulled together over a weekend. “It was like Paulson’s original tarp proposal,” Andrew Ross Sorkin tells me, referring to the former Treasury secretary. “His was three pages, mine was three pages.” We’re sitting at the Lyric Diner on Third Avenue on a Monday morning. Sorkin’s Tuesday Times column is due in a few hours, but, as usual, he’s way behind, and later I learn that he missed it entirely and his editors had to scramble. His excuse is that he’s got a book, 
is a 2009 nonfiction book about events leading up to and culminating in the Great Depression as told through the personal histories of the heads of the Central Banks of the world's four major economies at the time: Benjamin Strong Jr. of the New York Federal Reserve, Montagu Norman of the Bank of England, Émile Moreau of the Banque de France, and Hjalmar Schacht of the Reichsbank. Liaquat Ahamed's book was generally well received by critics, and won the 2010 Pulitzer Prize for History. Because Lords of Finance was published during the midst of the financial crisis of 2007–2010, the book subject matter was seen as very relevant to current financial events. One of the main themes of the book is the role played by the central bankers' insistence to adhere to the gold standard "even in the face of total catastrophe." As Joe Nocera, a book reviewer at the New York Times, stated, "the central bankers were prisoners of the economic orthodoxy of their time: the powerful belief that sound monetary policy had to revolve around the gold standard...Again and again, this straitjacket caused the central bankers — especially Norman, gold’s most fervent advocate — to make moves, like raising interest rates, that would allow their countries to hold on to their dwindling gold supplies, even though the larger economy desperately needed help in the form of lower interest rates." Another theme that runs through the Liaquat Ahamed book is how difficult it was to forecast the financial future and how the events would influence world events. "The opinions of Liaquat Ahamed are made very clear (the Paris Peace Conference’s plan for Germany to pay war reparations is presented as a great blunder), but his overriding idea is that blame cannot be easily assigned: not even the most sophisticated economists of the era could accurately predict disaster, let alone guard against it. The effects of a public herd mentality at the time of the 1929 stock market crash are depicted, all too recognizably, as unstoppable."
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