Andrew Sorkin - Too Big to Fail - The Inside Story of How Wall Street and Washington Fought to Save the FinancialSystem--and Themselves

165 The company had paid Manchester United $100 million: “Manchester United Signs Shirt Deal with American Insurance Giant,” Associated Press, April 6, 2006.

166 “AIG Offers Empathy, Little Else”: Liam Pleven and Randall Smith, “AIG Offers Empathy, Little Else—Some Shareholders Left Wanting More After Insurer’s Slips,” Wall Street Journal, May 15, 2008.

166 an additional $10 billion in new collateral: Randall Smith, Amir Efrati, and Liam Pleven, “AIG Group Tied to Swaps Draws Focus of Probes,” Wall Street Journal, June 13, 2008; Liam Pleven, “AIG’s $5.4 Billion Loss Roils the Markets—Investors Impatient on New CEO’s Plan as Problems Attack the Complex Insurer,” Wall Street Journal, August 8, 2008.

167 The two men agreed to have dinner together: Liam Pleven, “Two Financial Titans Put on Best Face,” Wall Street Journal, June 17, 2008; Lilla Zuill, “New AIG Chief and Ex-CEO Greenberg Set to Meet Thursday,” Reuters, June 18, 2008.

CHAPTER NINE

168 Oil, most crucially, was going for $140 a barrel: A record for oil futures in Russia, this price was predicted to rise—and it did—hitting $147 in July. “Russia’s Crude Money Box,” International Securities Finance, June 26, 2008.

168 Russia was pumping out millions of barrels a day: The International Energy Agency said that as of June 11, 2008, Russia was producing 9.5 million barrels of oil per day. Jason Bush, “Prime Minister Putin Primes the Pump,” BusinessWeek, June 30, 2008.

169 who had coined the appellation for those four economies: Goldman’s chief economist Jim O’Neill, leading a team from the firm, created the acronym in 2001, when they were making growth predictions about the four emerging markets. See Dominic Elliott, “Fundamentals Drive the ‘BRIC’ Rebound,” Wall Street Journal, July 27, 2009.

169 defaulting on the nation’s debt: “On August 13, with dollars fleeing the country, its reserves dwindling, its budget overtapped, and the price of oil, its chief commodity, down 33 percent, the government imposed controls on the ruble.” Lowenstein, When Genius Failed, 140-45.

169 Long-Term Capital Management: Ibid.

169 “I really think we are a little better”: Bethany McLean, “The Man Who Must Keep Goldman Growing,” Fortune, March 17, 2008.

170 They had bet against something called the ABX Index: Chris Blackhurst, “The Credit Crunch Genius Who Masterminded a £2 billion Jackpot,” Evening Standard (London), December 18, 2007.

170 “I don’t speak Russian”: Ellis, The Partnership , 37.

170 Yeltsin’s new government named the firm its banking adviser: “Russia Hires Goldman Sachs as Adviser,” Washington Post , February 18, 1992.

170 Goldman pulled out of the country in 1994 but would eventually return: Joseph Kahn and Timothy L. O’Brien, “For Russia and Its U.S. Bankers, Match Wasn’t Made in Heaven,” New York Times, October 18, 1998.

170 Adolf Hitler had planned to hold his victory celebration there: Hitler had chosen Astoria’s Winter Garden ballroom for his victory ball, scheduled for November 7, 1941, but Germany’s summer invasion of the Soviet Union didn’t go as planned. Stacks of invitations were later discovered in Berlin’s Nazi headquarters after the war. Corinna Lothar, “Gem of the North—St. Petersburg Reclaims Its Glory as Russia’s ‘Window to the West,’ ” Washington Times , December 27, 2003.

172 short, fat, bearded guy who wore tube socks: Jenny Anderson, “Goldman Runs Risks, Reaps Rewards,” New York Times, June 10, 2007.

172 Blankfein’s beginnings: Neil Weinberg, “Sachs Appeal,” Forbes, January 29, 2007; Ellis, The Partnership , 669; Bethany McLean, “The Man Who Must Keep Goldman Growing,” Fortune, March 17, 2008; Susanne Craig, “How One Executive Reignited Goldman’s Appetite for Risk,” Wall Street Journal, May 5, 2004.

172 dating a Wellesley student from Kansas City, he took a summer job at Hallmark: Ellis, The Partnership , 707.

172 “If we don’t show up Monday it’s because we’ve hit the jackpot”: Craig, “How One Executive Reig nited,” Wall Street Journal, May 5, 2004.

172 “prelife crisis”: Ibid.

173 taking a job as a salesman of gold coins and bars, she cried: Ibid. Also see “Laura Jacobs Engaged to Lloyd C. Blankfein,” New York Times, May 15, 1983.

173 the firm acquired J. Aron in late October 1981: On October 29, 1981, Goldman Sachs announced its acquisition of J. Aron & Company for an undisclosed amount (at the time industry experts said it was “slightly more than $100 million”). H. J. Maidenberg, “Goldman Sachs Buys Big Commodity Dealer,” New York Times, October 30, 1981.

173 they pounded their desks with their fists and threw their: Endlich, Goldman Sachs, 96.

173 “You can call yourself contessa, if you want”: Bethany McLean, “Rising Star: Lloyd Blankfein, Goldman Sachs,” Fortune, February 6, 2006.

173 Winkelman first noticed Blankfein: Craig, “How One Executive Reignited,” Wall Street Journal.

174 “We’ve never seen it work to put”: Ellis, The Partnership, 266.

174 structuring a trade that allowed a Muslim client to obey the Koran’s proscriptions: Craig, “How One Executive Reignited,” Wall Street Journal.

174 Winkelman was crushed when he was passed over for Corzine: Adrian Cox and George Stein, “Winkelman, Denied Top Goldman Job, Seeks to Fix Refco,” Bloomberg News, October 24, 2005.

174 he announced that he had selected Blankfein as his replacement: Jenny Anderson, “Blankfein Next in Line at Goldman,” New York Post, December 19, 2003; Kate Kelly, Greg Ip, and Ianthe Jeanne Dugan, “For NYSE, New CEO Could Be Just the Start,” Wall Street Journal, December 19, 2003.

174 “Legally, we would be buying Morgan”: Ellis, The Partnership , 639.

175 Gramm-Leach-Bliley Act: Barbara A. Rehm, “Commerce, a Reform Gem, in Fed ’s Hands,” American Banker , November 9, 2000.

177 collateral dispute with AIG: Serena Ng, “Goldman Confirms $6 Billion AIG Bets , ” Wall Street Journal, March 21, 2009.

177 Dmitry Medvedev had recently been elected to succeed him: Medvedev was elected Russia’s president on Sunday, March 2, 2008, after Putin had officially endorsed him in December. Peter Finn, “Putin’s Chosen Successor, Medvedev, Elected in Russia; Power-Sharing Is Main Focus After a Crushing Win,” Washington Post , March 3, 2008.

178 visiting the Persian Gulf states; attending the Group of Eight meeting of finance ministers in Osaka: Paulson’s trip began at the end of May with Saudi Arabia, Qatar, and the United Arab Emirates. In Abu Dhabi, he delivered a speech on the importance of open investment and then headed off to Osaka, where he met with Japanese finance minister Fukushiro Nukaga, before the G8 conference began. “Treasury Secretary Paulson to Travel to the Middle East,” Department of the Treasury Press Releases/Statements, May 28, 2008; “Nukaga, Paulson Set to Meet Ahead of G-8 Finance Ministers’ Talks,” Japan Economic Newswire, June 13, 2008.

178 “To address the perception that some institutions”: “Remarks by U.S. Treasury Secretary Henry M. Paulson, Jr. on the U.S., the World Economy and Markets before the Chatham House,” July 2, 2008. See http://www.treas.gov/press/releases/hp1064.htm.

179 Spaso House: See moscow.usembassy.gov/spaso.html.

179 private sessions with Medvedev and Putin: David Lawder, “Paulson in Russia to Meet with Medvedev, Putin,” Reuters, June 29, 2008.