Too Big To Fail 2011 Hdrip Xvid-sam-En

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TOO BIG TO FAIL (2011)
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We have no intention of dismantling
the regulatory agencies.
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However,
we must come to grips with...
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inefficient
and burdensome regulations.
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We will eliminate those...
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that are unproductive
and unnecessary.
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Tearing down
these antiquated walls...
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and granting banks
significant new authority.
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In a victory for
the banking industry,
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Congress has approved
legislation which will allow...
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commercial and
investment banks to merge...
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and form institutions
of unprecedented size...
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and global reach.

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I think it's very important...
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for us not to introduce...
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regulation
for regulation's sake.
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I do believe
in the American dream.
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Owning a home
is a part of that dream.
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We are taking action...
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to bring many thousands
of Americans...
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closer to owning
a home.
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This project
not only is good...
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for the soul
of the country.
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It's good for the pocketbook
of the country as well.
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The housing market has reached
frantic proportions.
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It seems that everybody is
building, buying or selling.
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The Dow and the S&P
both breaking records,
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profits soared 93%
at Goldman Sachs this year.
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Hotshot traders and bankers
can expect to take home...
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10... 25... and in some cases
50 million dollars.
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Things that are too good
to be true, are.
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- When you see something coming...
- The real estate bubble.
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- Housing bubble...
- Bubble.
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Don't put it off.
take action immediately.
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Will there be a soft landing
or will the bubble burst?
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The new story...
the mortgage meltdown.
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This morning in the mortgage meltdown,
new numbers showing...
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that a record number of Americans
are losing their homes.
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More than 70 mortgage companies
have failed...
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in the last few months
in America.
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and now the biggest of the big companies...
the Bear Stearns...
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the big banks are caught
holding the bag.
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The fifth largest
investment bank in the country,
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Bear Stearns,
is being sold
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for just $2 a share
to J.P. Morgan.
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It's being assisted
by the government
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which is stepping in
to guarantee some $30 billion
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in Bear's toxic
real estate assets.
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You've got to imagine
that Hank Paulson
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didn't think
he signed up for this
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when President Bush
picked him
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to become
Treasury Secretary.
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Hank Paulson
may now have to undo
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some of the deregulation
measures...
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that he and his peers
on Wall Street pushed through
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when he ran Goldman.
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Treasury Secretary
Hank Paulson
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telling Matt Lauer
this morning
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"We're all over it. I've got
great confidence in our markets.
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They're resilient.
They're flexible".
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Ali, the truth is
that Bear Stearns is...
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only a very small fraction

of this story.
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our economy
could face
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far worse
than a recession.
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In the wake of
Bear's collapse,
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Lehman Brothers is scrambling
to reassure investors
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about the impact
of the mortgage crisis
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on its own assets,
shares of the firm
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under a great deal
of pressure this morning.
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Dick Fuld, a 39-year veteran
of Lehman...
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and the longest-running CEO of a
major investment bank on Wall Street,
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has pulled the firm back from
the brink during other crises.
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But today, for the first time
that I'm hearing it,
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investors are questioning

his leadership.
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- Motherfucker.
- One key question...
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investors have
for Lehman Brothers:
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What's the true earnings power
of this investment bank's business?
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Hey.
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Get up here.
We gotta start stacking sandbags.
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What are you
talking about?
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We're down 21%.
On paper,
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I just lost 90 million dollars
personally.
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With investors pummeling
Lehman shares,
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the big question
this morning is...
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what options
does Fuld have?
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So far he has failed
to raise new capital...

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while virtually all of his
rivals have already done so.
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And now hedge fund manager
David Einhorn...
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is publicly questioning the accuracy
of the firm's numbers.
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Anything good?
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It's a red-tailed hawk,
the first one this year.
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Dick Fuld's on one.
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They haven't been able
to provide credible answers.
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So let's go through
a couple of those...
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what you call
discrepancies, because...
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Tough morning?
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We show top-quality earnings.
We beat every prediction.
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- Yeah.
- It's the damn short-sellers.
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You know the game...
short and distort.
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They're rumormongers.
And they're making a killing.
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What are your plans
for a capital raise?
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We're way ahead of you.
Now let me be clear:
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we don't need the cash.
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You know,
it's about perception.
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Buffett, Buffett.
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We're thinking of reaching out
to Warren Buffett.
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Great.
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You and Buffett
go back, right?
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Do me a favor
and call him.
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Tell him
Lehman is rock solid.
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As Treasury Secretary, I can't
advocate for a specific investment.
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Hank, you want me
to raise capital or not?
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Lehman Brothers is a hell of
a lot bigger than Bear Stearns.
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The market
is terrified.
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When I was running Goldman,
I never even conceived
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of asking the Treasury Secretary
to cut a deal for me.
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Yeah, but the Bear
bailout created...
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Please don't call it
a bailout.
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Okay, the very large Bear Stearns
purchase assistance package
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created an expectation.
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Fuld's counting on direct
intervention from you.
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Uh, Buffett's
a simple solution.
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I think
you make the call.
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As what?
Warren's friend?
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His former banker?
The Treasury Secretary?
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No.
Fuld's calling him.
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Hopefully he'll jump in
and we can all relax.
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Relax? We just buried
one investment bank.
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We got another one
that's barely breathing.
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This is a confidence game.
People lose faith in Lehman...
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these banks are gonna
drop like dominos...
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and I don't have the authority
to do a thing about it.
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We're late.
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We've been late
on everything.
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Neel's team is working on some
kind of a disaster scenario.
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We're calling it
the break-the-glass plan...
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what to ask Congress for
if your back's against the wall.
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Money...
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Is what you
ask them for.
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The problem is,
Congress won't move
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until we've already
hit the iceberg,
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and at that point
it may be too late.
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So you're saying,
with the full weight
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of the United States Treasury
behind me,
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all I can do is
call Warren Buffett?
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Hi, Warren.
It's Hank.
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I understand you've been
talking to Dick Fuld.
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You know my
misgivings, Hank,
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about investment banks.
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As soon as they started
trading for themselves,
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the risk managers
lost control.
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I had a very unpleasant time
with Solomon Brothers.
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That's fair enough.
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But we both know
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that investment banking
is a profitable business.
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I figure it made you
a billionaire somewhat.
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I gotta believe that
if the price was right,
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you wouldn't
just walk away.
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You know a good deal
when you see one.
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What say you?
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I gotta leave that
to your judgment.
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People act like
we're crack dealers.
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Nobody put a gun
to anybody's head and said,
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"hey, Nimrod, buy a house
you can't afford.
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And you know what?
While you're at it,
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put a line of credit on that baby
and buy yourself a boat".
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You heard anything
from Buffett?
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He's asking for
preferred shares at 40
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with a dividend
of 9%.
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We were just at 66.
What the fuck?
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Maybe it's just
an opening gambit, Dick.
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Sounds more like
a goddamn insult.
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- Let me get that, Dick.
- Thank you.
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We're at 36 right now.
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We haven't been anywhere
near 66 in months.
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The markets
like Buffett.
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His name will push
the price up overnight.
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You know, I don't care
who he is,
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I am not spending
$360 million a year
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for the pleasure of doing
business with him.
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Real estate
will come back.
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The Koreans have been
sniffing around.
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There you go.
And they won't steal us blind.
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I've seen this before...
C.E.O.s panic and they sell out cheap.
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Right now the street's running

around with its hair on fire,
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but the storm
always passes.
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We stand strong,
and on the other side
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we'll eat
Goldman's lunch.
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So what do we do
about Buffett?
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Screw Warren Buffett.
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He passed?
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Lehman dropped to 28 and 1/2
this morning.
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What in the world
is he thinking?
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He's not thinking.
He's delusional.
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He thought the ask
was too high.
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He's got to raise cash.
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I told him that.
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I spoke to Greenspan.
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Really?
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He says there's too much
housing supply.
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That's the problem.
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So we should buy up
all the vacant houses...
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and burn them.
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Dick needs a buyer...
someone with a grip on reality.
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Barclays expressed some interest
a couple of months ago,
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But I don't think
the price is low enough for them.
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Bank of America?
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Possible. Dick's put out
feelers there before.
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We have to keep it
quiet though.
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If anyone hears that
they're trying to sell...
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Lehman will be dead
within the hour.
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The real estate investments
are killing the firm.
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We have to admit publically
we've made some mistakes.
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We need to make
a senior management change,
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Signal to the market
that we get it.
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Meaning what?
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Meaning Joe Gregory.
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Get the fuck
out of here.
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You are not gonna tell me
how to run my company.
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Joe hasn't had your back on risk,
and everyone knows it.
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Erin Callan's
gotta go too.
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As far as the street's
concerned, she's a joke.
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Joe Gregory has been
with me
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for 30 years.
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And you want me
to kick him to the curb
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because we have
a bad quarter?
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It's not just
a bad quarter.
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The stock hit 23.
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23. Most of our guys are
paid in stock they can't sell for years.
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They've lost most of their net worth
over the last six months.
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You don't stabilize
the price,
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Your traders
are gonna jump ship.
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Selfish fucks.
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00:10:11,895 --> 00:10:14,129
It's not just bankers
and traders, Dick.
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Clients are pulling
their money.
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There's gonna be a run
on this bank.
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Sources tell CNBC
that both
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Erin Callan and Joseph Gregory
are out at Lehman Brothers.
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In a statement, the company's
chairman Dick Fuld said
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00:10:30,313 --> 00:10:33,114
Replacing Gregory with
48-year-old Bart McDade
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has been one of the most
difficult decisions he's had to make.
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Dick, the Koreans just
arrived at Sullivan.
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Let's make this happen.
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My take is you'd be better off
staying here for now.
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We need you to be
our missing man.
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We'll go in and push
the deal as far as we can,
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And then we'll bring you in
at the end to top it off.
248
00:10:56,903 --> 00:10:58,136
All right, fine.

249
00:10:58,137 --> 00:11:01,021
Okay.
250
00:11:06,511 --> 00:11:09,395
We are committed
to our presence in New York.
251
00:11:11,481 --> 00:11:14,867
But we need to know that the
underlying numbers make sense.
252
00:11:17,554 --> 00:11:19,488
We realize
how things look.
253
00:11:19,489 --> 00:11:22,923
But our stock is getting
hammered by the shorts.
254
00:11:22,924 --> 00:11:25,075
The value
is still there.
255
00:11:26,494 --> 00:11:28,729
We just started.
Min is excited,
256
00:11:28,730 --> 00:11:30,430
but we haven't heard
the terms.
257
00:11:30,431 --> 00:11:33,033
Where are you?
258
00:11:33,034 --> 00:11:34,701
I just stepped out
to take the call.
259
00:11:34,702 --> 00:11:37,237
Get back in there.
Don't be rude.
260
00:11:37,238 --> 00:11:39,156
Okay.
261
00:11:40,475 --> 00:11:43,378

We simply take the assets
you don't find appealing,
262
00:11:43,379 --> 00:11:46,531
spin them off
into a separate company.
263
00:11:48,251 --> 00:11:50,986
- You don't buy that bank.
- I'm very sorry.
264
00:11:50,987 --> 00:11:54,539
You buy the good bank.
265
00:11:55,524 --> 00:11:57,423
They don't like
the real estate.
266
00:11:57,424 --> 00:11:58,857
What do you mean,
they don't like it?
267
00:11:58,858 --> 00:12:00,859
Dick, we're making
real progress here, okay?
268
00:12:00,860 --> 00:12:02,877
Let me stay on it
for now.
269
00:12:18,511 --> 00:12:20,912
Min, how are you?
270
00:12:20,913 --> 00:12:23,348
Great to see you.
271
00:12:23,349 --> 00:12:25,917
I don't want
to interrupt.
272
00:12:25,918 --> 00:12:27,852
Dick, great timing.
273
00:12:27,853 --> 00:12:30,922
We seem to be in sync on the
broad strokes of the deal.
274
00:12:30,923 --> 00:12:33,424
Shall we get back
to the letter of intent?
275
00:12:33,425 --> 00:12:35,693
Min, I have to
tell you,
276
00:12:35,694 --> 00:12:38,395
I think you're making
a big mistake here.
277
00:12:38,396 --> 00:12:41,065
There's great value
in the real estate assets.
278
00:12:41,066 --> 00:12:44,233
How about we walk
through the portfolio
279
00:12:44,234 --> 00:12:46,719
and I'll show you?
280
00:12:48,271 --> 00:12:50,606
We have looked at them.
281
00:12:50,607 --> 00:12:52,541
Well, then you...
282
00:12:52,542 --> 00:12:54,710
you must have looked at them
in the wrong way.
283
00:12:54,711 --> 00:12:58,412
I just don't want to see you
leave money on the table.
284
00:12:58,413 --> 00:13:00,798
Perhaps we should
take a break.
285
00:13:07,023 --> 00:13:09,158
Min, I'm so sorry.
286
00:13:09,159 --> 00:13:11,160
We have negotiated
in good faith.
287
00:13:11,161 --> 00:13:13,394
Now all of a sudden
we are going backward?
288
00:13:13,395 --> 00:13:14,995
We can work with you
on the price.
289
00:13:14,996 --> 00:13:16,929
It is not about
the price.
290
00:13:16,930 --> 00:13:20,181
It is about the way
you have conducted this.
291
00:13:25,635 --> 00:13:29,271
I'd like to thank you,
all of you,
292
00:13:29,272 --> 00:13:32,290
but I don't think we have
a structure that works.
293
00:13:38,413 --> 00:13:40,483
What, that's it?
294
00:13:40,484 --> 00:13:42,699
You're just gonna pack up
and go back to Korea?
295
00:13:56,028 --> 00:13:58,163
- Hello.
- Neel, it's Dick Fuld.
296
00:13:58,164 --> 00:14:01,199
Listen, you know,
297
00:14:01,200 --> 00:14:03,101
if Hank wants me
to find a buyer,
298
00:14:03,102 --> 00:14:04,836
you guys need
to step up and help.
299
00:14:04,837 --> 00:14:07,173

The Koreans just
walked out, okay?
300
00:14:07,174 --> 00:14:09,175
Look, I'm just speaking
for myself here,
301
00:14:09,176 --> 00:14:11,778
but I think you need to do
what's right for the firm.
302
00:14:11,779 --> 00:14:13,413
Do what's right?
303
00:14:13,414 --> 00:14:15,148
What is that supposed
to mean?
304
00:14:15,149 --> 00:14:17,116
If your stock price
keeps sliding,
305
00:14:17,117 --> 00:14:20,153
you may get an offer at a price
that doesn't look all that compelling,
306
00:14:20,154 --> 00:14:22,989
but you may have to take it just
to keep the company intact.
307
00:14:22,990 --> 00:14:24,824
What kind of price
are you talking about?
308
00:14:24,825 --> 00:14:26,458
Could be...
309
00:14:26,459 --> 00:14:29,077
I mean, it might be
low single digits.
310
00:14:30,797 --> 00:14:33,265
Last February
311
00:14:33,266 --> 00:14:36,669
we were
at 66 a share.
312
00:14:36,670 --> 00:14:41,175
Lehman Brothers is not
bear stearns.
313
00:14:41,176 --> 00:14:43,010
We've got
a great business.
314
00:14:43,011 --> 00:14:44,911
Real estate's gonna
come back.
315
00:14:44,912 --> 00:14:48,147
I am not fucking
giving this company away!
316
00:14:48,148 --> 00:14:49,688
While the real estate market
317
00:14:49,689 --> 00:14:51,218
has put Lehman Brothers shares
under pressure,
318
00:14:51,219 --> 00:14:53,553
mortgage giants Fannie Mae
and Freddie Mac stocks
319
00:14:53,554 --> 00:14:56,122
are suddenly plummeting
this morning after reports
320
00:14:56,123 --> 00:14:58,859
the companies may need
to raise $75 billion
321
00:14:58,860 --> 00:15:02,062
just to remain solvent.
Because they guarantee
322
00:15:02,063 --> 00:15:04,500
such an enormous percentage
of the nation's mortgages,
323
00:15:04,501 --> 00:15:06,702
there is renewed speculation
that the government
324
00:15:06,703 --> 00:15:08,370
may have to step in
and take them over...
325
00:15:08,371 --> 00:15:12,740
a possibility Barack Obama has
now raised on the campaign trail.
326
00:15:12,741 --> 00:15:15,076
If Fannie Mae and
Freddie Mac collapsed,
327
00:15:15,077 --> 00:15:18,813
then probably
the financial system
328
00:15:18,814 --> 00:15:21,248
would receive
such a body blow
329
00:15:21,249 --> 00:15:23,851
that it could be
disastrous.
330
00:15:23,852 --> 00:15:26,286
Freddie just
dropped another 8%.
331
00:15:26,287 --> 00:15:28,755
Fannie's down 5%.
332
00:15:28,756 --> 00:15:31,625
There's... there's no
bottom here.
333
00:15:31,626 --> 00:15:34,861
We need to do
something now.
334
00:15:34,862 --> 00:15:36,829
We're working on
a proposal for Congress,
335
00:15:36,830 --> 00:15:39,365
see if we can get the authority
to put some money in.
336
00:15:39,366 --> 00:15:41,400

I'd rather not go
that way,
337
00:15:41,401 --> 00:15:43,701
but if we get there...
338
00:15:43,702 --> 00:15:46,720
Uh, I think...
I think we're already there.
339
00:15:48,372 --> 00:15:50,139
How much are you
gonna ask for?
340
00:15:50,140 --> 00:15:51,774
A blank check.
341
00:15:51,775 --> 00:15:55,177
It has to be enough of a statement
to reassure the market.
342
00:15:55,178 --> 00:15:59,081
They need to think I've got
a bazooka in my pocket.
343
00:15:59,082 --> 00:16:01,084
I'm not saying
that we use it,
344
00:16:01,085 --> 00:16:03,086
but if we have
the authority,
345
00:16:03,087 --> 00:16:05,087
everyone who's dumping
their shares
346
00:16:05,088 --> 00:16:07,156
will calm down,
back off.
347
00:16:07,157 --> 00:16:09,157
Okay, well, if you're
going to Congress,
348
00:16:09,158 --> 00:16:10,925
why don't we give
to the banks too?

349
00:16:10,926 --> 00:16:13,193
'Cause Lehman is looking like shit
and Merrill's not far behind.
350
00:16:13,194 --> 00:16:16,029
We'll be lucky to get them to move
on Fannie and Freddie.
351
00:16:16,030 --> 00:16:18,548
We do what we can do.
352
00:16:29,341 --> 00:16:31,841
Secretary, Mrs. Paulson,
over here.
353
00:16:31,842 --> 00:16:34,910
Over here, please.
354
00:16:34,911 --> 00:16:37,480
Mr. and Mrs. Paulson.
355
00:16:37,481 --> 00:16:41,518
- Secretary Paulson.
- Mrs. Paulson. Thank you.
356
00:16:41,519 --> 00:16:43,220
Mrs. Paulson.
357
00:16:43,221 --> 00:16:45,088
Mr. Paulson.
358
00:16:45,089 --> 00:16:47,740
Mr. and Mrs. Paulson,
this way, please.
359
00:16:51,159 --> 00:16:53,226
Mr. Secretary, please.
360
00:16:53,227 --> 00:16:55,212
I got her.
361
00:16:56,631 --> 00:16:59,033
Right over here,
Secretary Paulson, please.
362
00:16:59,034 --> 00:17:00,935
Big smile.
Thank you.
363
00:17:00,936 --> 00:17:03,503
That's just what I need...
press photos
364
00:17:03,504 --> 00:17:06,137
of the Treasury Secretary
waving the Chinese flag.
365
00:17:06,138 --> 00:17:08,672
Paulson the Communist.
366
00:17:08,673 --> 00:17:11,641
The look on your face
was priceless.
367
00:17:11,642 --> 00:17:16,297
Hank, I must ask you
about Fannie and Freddie.
368
00:17:18,550 --> 00:17:20,852
We have hundreds
of billions invested.
369
00:17:20,853 --> 00:17:23,922
You've assured us
the investment is safe.
370
00:17:23,923 --> 00:17:26,791
And it is,
absolutely.
371
00:17:26,792 --> 00:17:30,795
We're watching a great deal
of our money disappear.
372
00:17:30,796 --> 00:17:33,231
Share prices
have dropped 60%
373
00:17:33,232 --> 00:17:35,333
in the last
two months.
374
00:17:35,334 --> 00:17:38,069

Carrying your bazooka around
has not helped matters.
375
00:17:38,070 --> 00:17:40,571
Congress gave you
the power.
376
00:17:40,572 --> 00:17:42,372
Perhaps it is time
to use it.
377
00:17:42,373 --> 00:17:44,307
The market
will stabilize.
378
00:17:44,308 --> 00:17:46,209
We just have
to give it some time.
379
00:17:46,210 --> 00:17:50,079
There was an approach
last month from Russia.
380
00:17:50,080 --> 00:17:52,348
They have
considerable holdings
381
00:17:52,349 --> 00:17:54,049
in Fannie and Freddie
as well.
382
00:17:54,050 --> 00:17:56,886
They suggested
we coordinate
383
00:17:56,887 --> 00:17:58,954
and without warning dump
hundreds of billions
384
00:17:58,955 --> 00:18:01,439
of Fannie and Freddie's bonds
onto the market.
385
00:18:03,659 --> 00:18:05,360
That would be...
386
00:18:05,361 --> 00:18:07,395
Yes.
387
00:18:07,396 --> 00:18:10,464
The amount of debt
your country carries
388
00:18:10,465 --> 00:18:13,450
is a terrible
vulnerability.
389
00:18:17,270 --> 00:18:18,504
But you...
390
00:18:18,505 --> 00:18:21,923
we declined
respectfully.
391
00:18:24,177 --> 00:18:26,278
Even in the U.S.
it seems
392
00:18:26,279 --> 00:18:29,948
the relationship between the
government and private industry
393
00:18:29,949 --> 00:18:32,299
isn't so simple.
394
00:18:35,253 --> 00:18:36,953
Was it a threat?
395
00:18:36,954 --> 00:18:40,457
No no, it was
a friendly reminder
396
00:18:40,458 --> 00:18:42,459
that with a single
phone call to Moscow
397
00:18:42,460 --> 00:18:45,011
they can take down
the entire U.S. economy.
398
00:18:52,537 --> 00:18:55,205
Well, the book says
399
00:18:55,206 --> 00:18:57,274
Fannie and Freddie

are a nightmare.
400
00:18:57,275 --> 00:18:59,609
They are in the hole easily
tens of billions of dollars.
401
00:18:59,610 --> 00:19:02,412
In another few weeks they're
gonna start defaulting on their debts.
402
00:19:02,413 --> 00:19:03,913
We're gonna have to
step in.
403
00:19:03,914 --> 00:19:07,166
I don't see
how we can avoid it.
404
00:19:08,686 --> 00:19:10,820
Turns out a bazooka's
not that useful
405
00:19:10,821 --> 00:19:12,772
unless you fire it.
406
00:19:14,291 --> 00:19:16,425
Lehman's down
another 10%.
407
00:19:16,426 --> 00:19:18,860
You are not gonna let me
get down a single bite, are you?
408
00:19:18,861 --> 00:19:20,429
That's why
I have oatmeal.
409
00:19:20,430 --> 00:19:23,132
Dick is trotting around the world
with his head in his hands
410
00:19:23,133 --> 00:19:24,934
and no one will
give him any money.
411
00:19:24,935 --> 00:19:27,236
Korea walked out on him.
Mexico told him to shove it.

412
00:19:27,237 --> 00:19:29,438
No one's interested.
All the dumb money's already in.
413
00:19:29,439 --> 00:19:31,307
What about B of A?
Are they still in the mix?
414
00:19:31,308 --> 00:19:33,709
And Barclays is
sniffing around again,
415
00:19:33,710 --> 00:19:35,577
now that they think
it's a fire sale.
416
00:19:35,578 --> 00:19:36,945
That's promising.
417
00:19:36,946 --> 00:19:38,881
I don't know.
The British...
418
00:19:38,882 --> 00:19:42,584
they do a lot of talking.
They never close.
419
00:19:42,585 --> 00:19:44,720
B of A is still
our best bet.
420
00:19:44,721 --> 00:19:46,255
This can't be
another Bear.
421
00:19:46,256 --> 00:19:47,404
Absolutely not.
422
00:19:47,405 --> 00:19:49,225
They want Lehman...
they buy it outright.
423
00:19:49,226 --> 00:19:50,994
But they may need
a little hand-holding.
424
00:19:50,995 --> 00:19:53,530
They just bought Countrywide.
They're spread a little thin.
425
00:19:53,531 --> 00:19:55,431
You may have to
give them a break
426
00:19:55,432 --> 00:19:57,166
with the capital
requirements.
427
00:19:57,167 --> 00:20:00,336
You want me to allow them
to raise their leverage
428
00:20:00,337 --> 00:20:02,872
so they can buy a bank
that's about to fail
429
00:20:02,873 --> 00:20:05,074
because it was
overleveraged?
430
00:20:05,075 --> 00:20:08,077
You got a better idea?
431
00:20:08,078 --> 00:20:11,214
Breaking news just coming in:
Sources telling CNBC
432
00:20:11,215 --> 00:20:13,450
that the government
has just taken control
433
00:20:13,451 --> 00:20:15,719
of Fannie Mae
and Freddie Mac.
434
00:20:15,720 --> 00:20:17,723
Back in July, you remember,
Hank Paulson said
435
00:20:17,724 --> 00:20:19,725
that he wanted
the power to step in,
436
00:20:19,726 --> 00:20:21,561

but he probably
wouldn't use it.
437
00:20:21,562 --> 00:20:23,363
It certainly sounds
like Paulson
438
00:20:23,364 --> 00:20:25,032
just pulled the trigger
on that bazooka.
439
00:20:25,033 --> 00:20:27,268
Despite the move nationalize
Fannie and Freddie,
440
00:20:27,269 --> 00:20:30,471
the market is still in negative
territory across the board.
441
00:20:30,472 --> 00:20:33,775
Investors now focusing their attention
on Lehman Brothers
442
00:20:33,776 --> 00:20:36,877
amid fresh reports that the nation's
fourth largest investment bank
443
00:20:36,878 --> 00:20:39,179
may be on the brink
of bankruptcy.
444
00:20:39,180 --> 00:20:41,481
- Rodge.
- Chris.
445
00:20:41,482 --> 00:20:44,198
Bring your money
today, huh?
446
00:20:46,783 --> 00:20:50,184
Make sure Fuld's not keeping
any bad news out of the mix.
447
00:20:50,185 --> 00:20:53,286
It's open kimono,
to quote Dick.
448
00:20:53,287 --> 00:20:56,071

There's a revolting image.
449
00:20:58,524 --> 00:21:01,392
Did you get a look
at the numbers?
450
00:21:01,393 --> 00:21:03,027
The real estate's
the issue.
451
00:21:03,028 --> 00:21:05,030
They got it marked
at $30 billion.
452
00:21:05,031 --> 00:21:07,065
It's worth maybe
half of that.
453
00:21:07,066 --> 00:21:09,000
Don't look so nervous.
454
00:21:09,001 --> 00:21:12,170
You're about to get a Wall Street
bank for the price of a hot dog.
455
00:21:12,171 --> 00:21:15,674
I know that Paulson told Ken Lewis
that he's not gonna pay for this.
456
00:21:15,675 --> 00:21:17,376
And I don't see
how we can do it
457
00:21:17,377 --> 00:21:19,478
unless the government takes
some of the downside.
458
00:21:19,479 --> 00:21:21,246
Paulson is posturing.
459
00:21:21,247 --> 00:21:22,948
He'll write a check
just like he did
460
00:21:22,949 --> 00:21:24,583
for Jamie Dimon
on the Bear deal.
461
00:21:24,584 --> 00:21:26,066
He has to.
He can't lose
462
00:21:26,067 --> 00:21:28,386
another major bank
in an election year.
463
00:21:28,387 --> 00:21:30,388
Besides,
the guy made, like,
464
00:21:30,389 --> 00:21:32,590
a half a billion bucks
at Goldman Sachs.
465
00:21:32,591 --> 00:21:35,660
He lets Lehman die...
Goldman's biggest competitor...
466
00:21:35,661 --> 00:21:37,929
makes him look like
he's still working for Goldman,
467
00:21:37,930 --> 00:21:41,082
he's just doing it
out of the desk at Treasury.
468
00:21:42,568 --> 00:21:45,938
Where are the donuts?
469
00:21:45,939 --> 00:21:48,407
Exactly. If you're the CEO
of one of these financial firms,
470
00:21:48,408 --> 00:21:50,977
you've already seen what the
government was willing to do.
471
00:21:50,978 --> 00:21:53,346
Why wouldn't you play
chicken with them and say,
472
00:21:53,347 --> 00:21:56,850
"Sure I'll help you out.
But you gotta throw in a sweetener,
473
00:21:56,851 --> 00:21:58,769
just like you did
for those guys"?
474
00:22:00,288 --> 00:22:03,257
They just assume
I'm gonna bail out Dick Fuld...
475
00:22:03,258 --> 00:22:06,426
like I'm the guy behind the
elephant with the shovel.
476
00:22:06,427 --> 00:22:08,395
They're all drawing
a line from Bear
477
00:22:08,396 --> 00:22:10,296
and Fannie and Freddie
right to Lehman.
478
00:22:10,297 --> 00:22:12,131
There's no way the taxpayers
are gonna go for another bailout...
479
00:22:12,132 --> 00:22:14,767
A very large
purchase assistance package.
480
00:22:14,768 --> 00:22:17,937
We need to come up with
a private-sector solution,
481
00:22:17,938 --> 00:22:20,272
get the investment banks
to bridge the gap.
482
00:22:20,273 --> 00:22:22,106
Okay, but that's
never gonna work,
483
00:22:22,107 --> 00:22:24,008
unless they believe
that you've drawn a line.
484
00:22:24,009 --> 00:22:27,527
I know you don't like leaking,
but let us reach out to the press.
485
00:22:33,449 --> 00:22:35,033
Okay.
486
00:22:37,252 --> 00:22:39,453
Mr. Flowers,
487
00:22:39,454 --> 00:22:41,857
there's a call for you...
Bob Willumstad from A.I.G.
488
00:22:41,858 --> 00:22:44,275
He's very insistent.
489
00:22:49,197 --> 00:22:51,365
Mr. Flowers.
490
00:22:51,366 --> 00:22:53,733
My people tell me
you're the man to talk to.
491
00:22:53,734 --> 00:22:55,267
We've got a real
problem here.
492
00:22:55,268 --> 00:22:56,835
Yeah? What kind
of problem?
493
00:22:56,836 --> 00:23:00,105
It looks very much like we are
about to run out of cash.
494
00:23:00,106 --> 00:23:01,540
A.I.G.?
495
00:23:01,541 --> 00:23:03,642
We've sent over a document.
It's a spreadsheet.
496
00:23:03,643 --> 00:23:06,544
It's confidential, of course,
but it might give you some insight.
497
00:23:06,545 --> 00:23:09,214
I'm in the middle of Lehman.
I'm working with B of A.
498
00:23:09,215 --> 00:23:12,117
Is there any way
you could come over tomorrow?
499
00:23:12,118 --> 00:23:14,219
I'll take a look
at the numbers
500
00:23:14,220 --> 00:23:16,504
and we'll talk.
501
00:23:21,494 --> 00:23:23,812
Mr. Flowers.
502
00:23:27,067 --> 00:23:28,801
Somebody put
the TV on.
503
00:23:28,802 --> 00:23:31,387
CNBC's talking
about Lehman.
504
00:23:35,909 --> 00:23:39,213
...Person familiar
with Paulson's...
505
00:23:39,214 --> 00:23:41,382
Treasury Secretary
Hank Paulson's thinking,
506
00:23:41,383 --> 00:23:43,917
and he is saying there will
be no government money
507
00:23:43,918 --> 00:23:46,219
in the resolution
of this situation.
508
00:23:46,220 --> 00:23:48,889
They're saying two things
make the Lehman deal different:
509
00:23:48,890 --> 00:23:51,091
The market's been aware
and had time to prepare
510
00:23:51,092 --> 00:23:53,460
for over six months;

And the second is...
511
00:23:53,461 --> 00:23:56,029
Is that just
TV bullshit,
512
00:23:56,030 --> 00:23:59,314
or is that Paulson
sending us a message?
513
00:24:00,100 --> 00:24:01,717
Chris?
514
00:24:08,743 --> 00:24:10,627
Yeah? Sorry.
515
00:24:13,680 --> 00:24:14,998
What exactly does
516
00:24:14,999 --> 00:24:17,349
"a person familiar with
the Treasury Secretary" mean?
517
00:24:17,350 --> 00:24:19,484
That could mean
a lot of things.
518
00:24:19,485 --> 00:24:21,252
Did one of your
staffers do this?
519
00:24:21,253 --> 00:24:23,387
Please tell me someone got fired
10 minutes ago.
520
00:24:23,388 --> 00:24:25,605
The leak came from me.
521
00:24:27,358 --> 00:24:29,192
Hank, a public statement
like that
522
00:24:29,193 --> 00:24:31,194
can have a lot of
unintended consequences.
523
00:24:31,195 --> 00:24:33,162

We had to send a message
to the other banks.
524
00:24:33,163 --> 00:24:34,376
They need to step up.
525
00:24:34,377 --> 00:24:36,440
I don't have another rabbit
I can pull out of my hat.
526
00:24:37,401 --> 00:24:40,136
Rodgin Cohen
just called me.
527
00:24:40,137 --> 00:24:43,542
The B of A team is sitting there
playing brick breaker on their phones.
528
00:24:43,543 --> 00:24:45,012
They don't want this deal.
529
00:24:45,013 --> 00:24:47,516
The deal is hanging
by a thread
530
00:24:47,517 --> 00:24:49,386
because the closer
they get to Lehman
531
00:24:49,387 --> 00:24:51,689
the more it looks
like a toxic waste dump.
532
00:24:51,690 --> 00:24:55,126
Which is why at the end of the day
we may have to help them,
533
00:24:55,127 --> 00:24:58,863
which would be a lot easier
if we didn't publicly state that...
534
00:24:58,864 --> 00:25:00,965
We can't, Tim.
Legally we can't.
535
00:25:00,966 --> 00:25:03,268
Legally we haven't
figured out
536
00:25:03,269 --> 00:25:07,138
how yet.
537
00:25:07,139 --> 00:25:11,109
I am concerned
538
00:25:11,110 --> 00:25:13,777
we are limiting
our options
539
00:25:13,778 --> 00:25:17,046
at a time when we have
very few,
540
00:25:17,047 --> 00:25:19,230
if any, available.
541
00:25:21,650 --> 00:25:25,286
I want all the C.E.O.s
in a room.
542
00:25:25,287 --> 00:25:27,255
We've got the weekend.
543
00:25:27,256 --> 00:25:29,658
We lock them in a room
at the Fed
544
00:25:29,659 --> 00:25:33,363
and we don't let them out until
they have a solution on Lehman.
545
00:25:33,364 --> 00:25:35,398
Your oatmeal's
getting cold.
546
00:25:35,399 --> 00:25:38,583
They'll figure it out.
They'll all throw in some money.
547
00:25:40,102 --> 00:25:42,103
Well, Tim is
advocating strongly
548
00:25:42,104 --> 00:25:44,139
that we reconsider
some kind of Fed support.
549
00:25:44,140 --> 00:25:46,374
Tim wants us to pick up
the tab on everyone.
550
00:25:46,375 --> 00:25:48,909
I can't be
Mr. bailout.
551
00:25:48,910 --> 00:25:52,446
The Lehman hole is
twice what Bear's was.
552
00:25:52,447 --> 00:25:54,447
Investors are pulling
their accounts.
553
00:25:54,448 --> 00:25:57,016
You want to lend
into a run?
554
00:25:57,017 --> 00:25:59,251
What about Barclays?
Are they still interested?
555
00:25:59,252 --> 00:26:02,088
They can't afford the risk
any more than B of A can.
556
00:26:02,089 --> 00:26:05,626
I don't doubt your ability to talk
anybody into submission,
557
00:26:05,627 --> 00:26:07,795
but it is still
a long shot.
558
00:26:07,796 --> 00:26:11,666
And there's a very real possibility
that Lehman goes under.
559
00:26:11,667 --> 00:26:15,136
There's a deal
to be made here.
560
00:26:15,137 --> 00:26:17,938
I'm gonna make the deal.

561
00:26:17,939 --> 00:26:20,041
With just a little more
than an hour
562
00:26:20,042 --> 00:26:21,909
left until
the market closes,
563
00:26:21,910 --> 00:26:24,312
shares of Lehman Brothers
have taken another tumble.
564
00:26:24,313 --> 00:26:26,381
The stock is now
trading at a new low...
565
00:26:26,382 --> 00:26:28,318
under $4 a share.
566
00:26:28,319 --> 00:26:30,320
And judging from
the selling,
567
00:26:30,321 --> 00:26:33,239
there doesn't appear to be
a bottom in sight.
568
00:26:35,860 --> 00:26:37,862
So Blankfein
has a speech
569
00:26:37,863 --> 00:26:39,931
he's trying to get out of,
but the rest have confirmed.
570
00:26:39,932 --> 00:26:42,400
- Tell him it's not optional.
- Yeah.
571
00:26:42,401 --> 00:26:44,901
Good afternoon, Chairman.
Thank you so much for joining us.
572
00:26:44,902 --> 00:26:46,336
Whose plane is this?
573
00:26:46,337 --> 00:26:48,304
Uh, that's a rental.
574
00:26:48,305 --> 00:26:50,773
Hank put it
on his card.
575
00:26:50,774 --> 00:26:53,676
Sir, you know Neel and
Michele Davis, public affairs.
576
00:26:53,677 --> 00:26:54,944
Hi. Pleasure.
577
00:26:54,945 --> 00:26:56,645
This is Dan Jester...
our new numbers guy.
578
00:26:56,646 --> 00:26:57,623
Hi.
579
00:26:57,624 --> 00:26:59,149
I've talked him into
coming out of retirement.
580
00:26:59,150 --> 00:27:01,652
- Excuse me? Retirement?
- He was with us at Goldman.
581
00:27:01,653 --> 00:27:04,019
Got anybody at Treasury
who wasn't at Goldman?
582
00:27:04,020 --> 00:27:05,853
Chairman,
just to be clear,
583
00:27:05,854 --> 00:27:07,922
there's no question of
conflict of interest.
584
00:27:07,923 --> 00:27:10,557
Hank sold all of his Goldman stock
before he took office.
585
00:27:10,558 --> 00:27:12,292
I wasn't implying
anything.
586
00:27:12,293 --> 00:27:14,060
Sorry.
We're a little touchy
587
00:27:14,061 --> 00:27:16,762
about the whole
government-Sachs thing.
588
00:27:16,763 --> 00:27:18,680
Shall we?
589
00:27:21,667 --> 00:27:24,235
B of A keeps finding
more toxic assets.
590
00:27:24,236 --> 00:27:26,271
They want you
to reconsider a Jamie deal.
591
00:27:26,272 --> 00:27:28,172
They'll split the first
billion in losses,
592
00:27:28,173 --> 00:27:30,107
but they want you on the hook
for the next 40.
593
00:27:30,108 --> 00:27:32,342
You did it for Bear.
594
00:27:32,343 --> 00:27:34,643
Greg, let me
get back to you.
595
00:27:34,644 --> 00:27:37,112
What do I have to...
tattoo it on my forehead?
596
00:27:37,113 --> 00:27:38,780
We are not
bailing out Lehman.
597
00:27:38,781 --> 00:27:40,448
Wall Street has
a gambling problem.
598
00:27:40,449 --> 00:27:42,483
If government keeps
covering their losses,
599
00:27:42,484 --> 00:27:44,702
they never learn
anything.
600
00:27:45,453 --> 00:27:47,154
What?
601
00:27:47,155 --> 00:27:49,923
I didn't know if you wanted
to keep lecturing me on moral hazard
602
00:27:49,924 --> 00:27:52,658
or if I should just
call B of A back.
603
00:27:52,659 --> 00:27:54,762
We need to keep them at the table
604
00:27:54,763 --> 00:27:56,931
until they come up with
a private-sector solution.
605
00:27:56,932 --> 00:27:59,433
Tell them
to stay with us.
606
00:27:59,434 --> 00:28:01,636
- Alistair, hello.
- Hello, Henry.
607
00:28:01,637 --> 00:28:03,888
Hold on one second.
608
00:28:04,940 --> 00:28:06,941
Chancellor of
the Exchequer.
609
00:28:06,942 --> 00:28:10,345
I understand Barclays is one of
your potential buyers for Lehman.
610
00:28:10,346 --> 00:28:13,248
My banks are already under
a great deal of stress.

611
00:28:13,249 --> 00:28:15,550
They don't want
to become overextended.
612
00:28:15,551 --> 00:28:17,819
Lehman is problematic,
but there's value there.
613
00:28:17,820 --> 00:28:20,121
We will find a way
to make it attractive.
614
00:28:20,122 --> 00:28:22,323
Just stay with us.
615
00:28:22,324 --> 00:28:23,958
Talk soon.
616
00:28:23,959 --> 00:28:25,393
Bye.
617
00:28:25,394 --> 00:28:27,395
We'll keep Barclays
in the mix,
618
00:28:27,396 --> 00:28:30,231
but B of A is still
our best bet.
619
00:28:30,232 --> 00:28:33,668
We've got the C.E.O.s of every
major bank coming here tonight.
620
00:28:33,669 --> 00:28:37,038
We have to make it clear
that this their problem,
621
00:28:37,039 --> 00:28:40,440
that we are their advisors
and their allies,
622
00:28:40,441 --> 00:28:44,627
but we are not
their safety net.
623
00:28:45,779 --> 00:28:47,596

What should we expect
from these guys?
624
00:28:58,126 --> 00:29:00,127
Jamie is smart.
625
00:29:00,128 --> 00:29:02,229
He doesn't have as much
cash to work with
626
00:29:02,230 --> 00:29:04,931
since he bought Bear.
627
00:29:04,932 --> 00:29:07,733
Lloyd's a superstar.
628
00:29:07,734 --> 00:29:10,502
Goldman's the smartest
shop on the block.
629
00:29:10,503 --> 00:29:12,505
And just because
I used to be his boss,
630
00:29:12,506 --> 00:29:16,008
it doesn't mean
he's gonna listen to me.
631
00:29:16,009 --> 00:29:18,911
John Mack used to run
around the floor screaming,
632
00:29:18,912 --> 00:29:22,682
"there's blood in the water!
Let's go kill someone!"
633
00:29:22,683 --> 00:29:25,368
He's a fighter.
634
00:29:27,019 --> 00:29:28,886
Thain was my number two
at Goldman.
635
00:29:28,887 --> 00:29:30,887
He's selfish.
He's a pragmatist.
636
00:29:30,888 --> 00:29:34,840
He knows... if Lehman goes,
Merrill's next.
637
00:29:35,993 --> 00:29:39,429
Vikram Pandit is the new guy
at Citigroup.
638
00:29:39,430 --> 00:29:42,198
No one knows
if he's running Citi
639
00:29:42,199 --> 00:29:44,550
or if Citi's
running him.
640
00:30:07,286 --> 00:30:11,455
Thanks for coming down here
on such short notice.
641
00:30:11,456 --> 00:30:13,524
Monday morning Lehman
will no longer be able
642
00:30:13,525 --> 00:30:15,810
to honor
its obligations.
643
00:30:17,864 --> 00:30:21,133
We have two potential buyers...
B of A and Barclays.
644
00:30:21,134 --> 00:30:23,435
Neither will take the company
unless someone else
645
00:30:23,436 --> 00:30:25,737
finances part of the deal.
646
00:30:25,738 --> 00:30:29,357
The government is not
in a position to step in.
647
00:30:30,543 --> 00:30:33,544
I did the last one.
You're gonna do this one.
648
00:30:33,545 --> 00:30:34,945

Where is Dick Fuld?
649
00:30:34,946 --> 00:30:37,213
Dick's in no condition
to make any decisions.
650
00:30:37,214 --> 00:30:40,383
We're breaking you
into three groups.
651
00:30:40,384 --> 00:30:43,220
The first one
will try to value
652
00:30:43,221 --> 00:30:45,156
Lehman's toxic assets.
653
00:30:45,157 --> 00:30:47,226
The second one will work
on some sort of structure
654
00:30:47,227 --> 00:30:49,429
for you all to invest
in Lehman.
655
00:30:49,430 --> 00:30:53,134
And the third one works
on the lights-out plan.
656
00:30:53,135 --> 00:30:55,570
If Lehman files for bankruptcy,
we need to figure out
657
00:30:55,571 --> 00:30:57,872
how to contain the damage
to the rest of you.
658
00:30:57,873 --> 00:30:59,074
Christ.
659
00:30:59,075 --> 00:31:01,043
We've all seen
this coming for miles.
660
00:31:01,044 --> 00:31:04,248
I don't think the Lehman bankruptcy
takes down our firms.
661
00:31:04,249 --> 00:31:06,886
What, are we
crossing our fingers?
662
00:31:06,887 --> 00:31:09,555
You're asking us
to save a competitor.
663
00:31:09,556 --> 00:31:12,025
Let's not act like you're
doing us a favor.
664
00:31:12,026 --> 00:31:16,230
Gentlemen, gentlemen,
you are great Americans
665
00:31:16,231 --> 00:31:18,198
undertaking
a patriotic duty.
666
00:31:18,199 --> 00:31:20,966
Your travail
will earn you
667
00:31:20,967 --> 00:31:24,435
the love and gratitude
of your country.
668
00:31:24,436 --> 00:31:26,703
I think it was Thomas Paine
who said that these are...
669
00:31:26,704 --> 00:31:28,904
Lehman is a trading partner
for every bank in this room.
670
00:31:28,905 --> 00:31:31,706
And their failure will be a
massive blow to all of you.
671
00:31:31,707 --> 00:31:33,440
This is
your problem.
672
00:31:33,441 --> 00:31:35,908
We can all argue about
how we got here...
673
00:31:35,909 --> 00:31:38,243
deregulation,
derivatives,
674
00:31:38,244 --> 00:31:40,011
Dick Fuld made
bad decisions.
675
00:31:40,012 --> 00:31:43,648
We're all responsible.
It's a catastrophic mess.
676
00:31:43,649 --> 00:31:46,049
The government's done
whatever it can do.
677
00:31:46,050 --> 00:31:47,417
It's on you now.
678
00:31:47,418 --> 00:31:50,386
You need to fix it
and you need to pay for it.
679
00:31:50,387 --> 00:31:53,856
Let me be clear:
680
00:31:53,857 --> 00:31:55,858
We will remember
681
00:31:55,859 --> 00:31:58,677
anyone who's not helpful.
682
00:32:21,484 --> 00:32:23,919
Do you notice a little
pattern here?
683
00:32:23,920 --> 00:32:26,722
We don't deal with things until there's
some kind of emergency on the table.
684
00:32:26,723 --> 00:32:29,024
Yeah, we don't deal
with things until Friday...
685
00:32:29,025 --> 00:32:31,393
Some kind of a weekend thing.
When are we gonna figure out

686
00:32:31,394 --> 00:32:33,596
exactly how to handle the failure
of an investment bank?
687
00:32:33,597 --> 00:32:35,164
Well, let's do it
over a weekend.
688
00:32:35,165 --> 00:32:37,199
Just I talked to a person
who is monitoring
689
00:32:37,200 --> 00:32:39,536
The situation out there,
and the person said
690
00:32:39,537 --> 00:32:42,873
they all want the same deal
Jamie Dimon got,
691
00:32:42,874 --> 00:32:44,908
and they're not
going to get it.
692
00:32:44,909 --> 00:32:47,344
Just a heads up...
Chris Flowers is in the lobby.
693
00:32:47,345 --> 00:32:50,397
He's consulting
for B of A on Lehman.
694
00:32:52,116 --> 00:32:54,951
Hank pushed Flowers
out of Goldman.
695
00:32:54,952 --> 00:32:56,720
Yesterday we thought
Lehman was holding
696
00:32:56,721 --> 00:32:58,655
$30 billion in crap.
Today it's $70...
697
00:32:58,656 --> 00:33:02,156
$70 billion in assets that
we're valuing with a dartboard.

698
00:33:02,157 --> 00:33:03,525
No, we're gonna
work this out.
699
00:33:03,526 --> 00:33:05,827
Unless you step in,
we're ending this.
700
00:33:05,828 --> 00:33:07,261
Don't forget
about Dick.
701
00:33:07,262 --> 00:33:09,063
Yeah, Dick Fuld
keeps calling,
702
00:33:09,064 --> 00:33:10,981
hammering us
to raise the price.
703
00:33:12,601 --> 00:33:14,751
Excuse me.
704
00:33:19,107 --> 00:33:22,008
$70 fucking billion
705
00:33:22,009 --> 00:33:25,678
and no collateral?
706
00:33:25,679 --> 00:33:28,247
If Lehman Brothers fails
this weekend,
707
00:33:28,248 --> 00:33:30,549
there's little doubt
amongst the people I speak to
708
00:33:30,550 --> 00:33:32,650
that Merrill Lynch
will be next.
709
00:33:32,651 --> 00:33:34,987
Confidence is a very
fragile thing.
710
00:33:34,988 --> 00:33:38,692

And in our financial markets
it is eroding very quickly.
711
00:33:38,693 --> 00:33:40,926
Lehman's not gonna
make it.
712
00:33:40,927 --> 00:33:43,928
We're next.
We need to do something right now.
713
00:33:43,929 --> 00:33:46,197
B of A's the only one
out there.
714
00:33:46,198 --> 00:33:48,633
I can put in a call.
It screws Lehman, but...
715
00:33:48,634 --> 00:33:51,535
Lehman screwed themselves.
Paulson has drawn a line in the sand.
716
00:33:51,536 --> 00:33:53,470
Lehman is dead.
717
00:33:53,471 --> 00:33:55,855
Make the call.
718
00:33:58,541 --> 00:34:01,745
We'd like you guys
to look at taking a stake in Merrill,
719
00:34:01,746 --> 00:34:04,781
something in
the neighborhood of 10%.
720
00:34:04,782 --> 00:34:08,218
Well, I don't know
if I can generate any interest in 10%,
721
00:34:08,219 --> 00:34:11,321
but if the whole
company's in play,
722
00:34:11,322 --> 00:34:14,590
I bet that's something
that we'd consider.

723
00:34:14,591 --> 00:34:16,692
Us and Lehman?
724
00:34:16,693 --> 00:34:19,811
Deal of this size...
there's only room for one.
725
00:34:26,301 --> 00:34:28,502
It is a lot of risk,
no question,
726
00:34:28,503 --> 00:34:30,504
but if you stay
in the game,
727
00:34:30,505 --> 00:34:32,872
we all will find
a private solution.
728
00:34:32,873 --> 00:34:34,891
Absolutely.
729
00:34:35,910 --> 00:34:37,911
Don't get scared
by the numbers.
730
00:34:37,912 --> 00:34:40,447
We'll figure it out.
Lehman is worth owning.
731
00:34:40,448 --> 00:34:43,298
Guys, you got a second?
732
00:34:46,552 --> 00:34:48,553
I was at A.I.G.
yesterday.
733
00:34:48,554 --> 00:34:50,554
Next Wednesday
they got
734
00:34:50,555 --> 00:34:53,455
a $5 billion hole,
minimum.
735
00:34:53,456 --> 00:34:55,956

I called
Warren Buffett.
736
00:34:55,957 --> 00:34:58,924
He wouldn't touch it
with a stick.
737
00:34:58,925 --> 00:35:00,759
We're looking
into it.
738
00:35:00,760 --> 00:35:03,012
It's a very big company.
739
00:35:05,231 --> 00:35:07,198
Thanks, Chris.
740
00:35:07,199 --> 00:35:09,483
I appreciate
all your help.
741
00:35:15,741 --> 00:35:18,693
They're not
on top of it.
742
00:35:24,585 --> 00:35:26,837
Look at this.
743
00:35:30,526 --> 00:35:33,096
Is this even possible?
744
00:35:33,097 --> 00:35:34,998
A.I.G.?
745
00:35:34,999 --> 00:35:36,617
Holy shit.
746
00:35:37,903 --> 00:35:40,154
Get into this.
747
00:35:41,974 --> 00:35:44,727
John.
748
00:35:48,382 --> 00:35:51,685
Do you see
what's happening here?
749
00:35:51,686 --> 00:35:53,854
Are you watching out
for yourself?
750
00:35:53,855 --> 00:35:55,822
I'm not thick.
751
00:35:55,823 --> 00:35:58,708
I'm working
on something.
752
00:36:01,797 --> 00:36:05,082
You're talking
to B of A.
753
00:36:06,134 --> 00:36:08,235
I'm sorry.
754
00:36:08,236 --> 00:36:10,069
I know it's not good
for Lehman,
755
00:36:10,070 --> 00:36:11,637
but I have to take care
of Merrill.
756
00:36:11,638 --> 00:36:15,073
Let me worry
about Lehman.
757
00:36:15,074 --> 00:36:17,926
Barclays is still
in the game.
758
00:36:19,445 --> 00:36:21,596
Just get it done.
759
00:36:32,525 --> 00:36:36,345
B of A is gonna
buy Merrill.
760
00:36:38,197 --> 00:36:40,465
We need to make
Barclays work.
761
00:36:40,466 --> 00:36:44,003
I thought you said

the British never close.
762
00:36:44,004 --> 00:36:45,971
They're here.
763
00:36:45,972 --> 00:36:48,340
They seem to really
want it.
764
00:36:48,341 --> 00:36:51,844
If we hold their hands,
they'll close.
765
00:36:51,845 --> 00:36:53,979
Rodgin,
what the fuck?
766
00:36:53,980 --> 00:36:57,116
I can't get Geithner.
I can't get Paulson.
767
00:36:57,117 --> 00:37:00,253
I can't even get my own goddamn
employees to pick up the phone.
768
00:37:00,254 --> 00:37:02,322
There's a lot happening
down here, Dick.
769
00:37:02,323 --> 00:37:03,790
Oh fuck.
770
00:37:03,791 --> 00:37:06,293
You know what?
You tell Geithner,
771
00:37:06,294 --> 00:37:09,630
he doesn't pull my ass out of the fire...
Merrill's gonna be next.
772
00:37:09,631 --> 00:37:12,900
He knows that.
Dick, he just told me
773
00:37:12,901 --> 00:37:15,619
they're working
on a solution for Merrill.
774
00:37:18,306 --> 00:37:20,841
Those cocksuckers are
gonna bail out Merrill?
775
00:37:20,842 --> 00:37:22,476
No no, not the Fed.
776
00:37:22,477 --> 00:37:24,478
Well, there's no
private buyers.
777
00:37:24,479 --> 00:37:27,516
There's just B of A
and...
778
00:37:27,517 --> 00:37:30,151
they're gonna put B of A
together with Merrill?
779
00:37:30,152 --> 00:37:32,720
We still have Barclays.
Hank feels that...
780
00:37:32,721 --> 00:37:37,056
the federal government
is snaking my deal?
781
00:37:37,057 --> 00:37:40,843
I cannot fucking
believe this shit!
782
00:37:42,530 --> 00:37:44,832
B of A made a deal
with Merrill?
783
00:37:44,833 --> 00:37:46,901
Yeah, Lehman's still
our problem.
784
00:37:46,902 --> 00:37:49,270
I don't think I can take
another day of this.
785
00:37:49,271 --> 00:37:51,273
You're getting out
of a Mercedes
786
00:37:51,274 --> 00:37:53,308
to go to the New York
Federal Reserve.
787
00:37:53,309 --> 00:37:55,762
It's not a Higgins boat
on Omaha Beach.
788
00:38:03,854 --> 00:38:05,822
Okay okay,
789
00:38:05,823 --> 00:38:07,824
we've been here
a long time.
790
00:38:07,825 --> 00:38:10,259
Let's stop
fucking around.
791
00:38:10,260 --> 00:38:13,496
Main Street wants
Wall Street to pay.
792
00:38:13,497 --> 00:38:16,632
They think we're
overpaid assholes.
793
00:38:16,633 --> 00:38:20,169
There's no politician
who's gonna sign off on a bailout.
794
00:38:20,170 --> 00:38:22,172
Why would you
bail out people
795
00:38:22,173 --> 00:38:24,174
whose sole job
is to make money?
796
00:38:24,175 --> 00:38:28,644
So let's make this
real simple.
797
00:38:28,645 --> 00:38:31,413
Hank thinks
he can sell
798
00:38:31,414 --> 00:38:33,182

the good parts of Lehman
to Barclays,
799
00:38:33,183 --> 00:38:35,183
but someone has to take
the real estate crap
800
00:38:35,184 --> 00:38:37,585
that's weighing down
the company.
801
00:38:37,586 --> 00:38:39,587
Nobody knows how much
this shit is worth,
802
00:38:39,588 --> 00:38:41,655
but we know somebody has to
buy it to make a deal.
803
00:38:41,656 --> 00:38:43,690
I don't like it.
804
00:38:43,691 --> 00:38:46,159
Nobody likes it.
805
00:38:46,160 --> 00:38:48,995
Let's just suck it up
and do it.
806
00:38:48,996 --> 00:38:51,466
How many of you can
kick in a billion dollars
807
00:38:51,467 --> 00:38:54,219
to stop Lehman
from going down?
808
00:38:56,973 --> 00:38:59,041
I'm in.
809
00:38:59,042 --> 00:39:01,960
One billion.
810
00:39:12,221 --> 00:39:14,539
Okay.
811
00:39:20,162 --> 00:39:22,614

Goldman's
in for a billion.
812
00:39:29,806 --> 00:39:32,308
John?
813
00:39:32,309 --> 00:39:34,593
Yeah.
814
00:39:40,016 --> 00:39:42,267
Yes.
815
00:39:43,620 --> 00:39:45,971
Yeah.
816
00:39:47,223 --> 00:39:49,507
Yes.
817
00:39:53,996 --> 00:39:56,631
We did it.
Barclays came through.
818
00:39:56,632 --> 00:39:58,533
Too goddamn right!
819
00:39:58,534 --> 00:40:00,969
Barclays won't touch
the real estate assets,
820
00:40:00,970 --> 00:40:03,454
but the other banks
agreed to cover those.
821
00:40:04,840 --> 00:40:07,208
Call the board.
Get everybody here.
822
00:40:07,209 --> 00:40:09,111
We got a deal to make.
823
00:40:09,112 --> 00:40:10,729
Okay.
824
00:40:20,125 --> 00:40:21,726
Did you get him?
825
00:40:21,727 --> 00:40:24,628
Geithner doesn't
return my calls.
826
00:40:24,629 --> 00:40:26,462
We can't get hold of
any of those people.
827
00:40:26,463 --> 00:40:29,398
At the end of the day they can't
sign the deal without our say-so.
828
00:40:29,399 --> 00:40:32,150
Yes, but do they
know that?
829
00:40:35,404 --> 00:40:37,405
Yes.
830
00:40:37,406 --> 00:40:39,039
Yes, by all means,
831
00:40:39,040 --> 00:40:41,408
now that he deigns to call,
put him through.
832
00:40:41,409 --> 00:40:44,611
Sir Callum, sorry I haven't
gotten back to you.
833
00:40:44,612 --> 00:40:46,447
We're just
sorting through
834
00:40:46,448 --> 00:40:49,082
this Barclays deal
for Lehman.
835
00:40:49,083 --> 00:40:51,284
As Barclays' regulator,
836
00:40:51,285 --> 00:40:54,287
we have serious concerns
about this proposed arrangement.
837
00:40:54,288 --> 00:40:56,122
What... are...
are you saying

838
00:40:56,123 --> 00:40:58,223
you won't approve
the deal?
839
00:40:58,224 --> 00:41:00,358
Even if we were
comfortable with the agreement,
840
00:41:00,359 --> 00:41:01,926
which we are not,
841
00:41:01,927 --> 00:41:03,928
Barclays would need
at least 30 days
842
00:41:03,929 --> 00:41:05,896
for shareholder
approval.
843
00:41:05,897 --> 00:41:08,299
No no no no no no.
844
00:41:08,300 --> 00:41:10,668
He can't.
He can't do this.
845
00:41:10,669 --> 00:41:13,405
- Can they stop the deal?
- Of course they can stop the deal.
846
00:41:13,406 --> 00:41:15,407
But even if they don't stop it,
the delay will kill it.
847
00:41:15,408 --> 00:41:18,910
Let's call the Chancellor
of the Exchequer right now.
848
00:41:18,911 --> 00:41:21,078
None of those
assets
849
00:41:21,079 --> 00:41:23,698
would be part
of Barclays.
850
00:41:24,917 --> 00:41:29,104
Yes, but if the F.S.A.
were to...
851
00:41:30,590 --> 00:41:35,410
of c...
of course.
852
00:41:36,429 --> 00:41:38,430
Yeah.
853
00:41:38,431 --> 00:41:40,949
I wish you good night.
854
00:41:42,136 --> 00:41:44,486
Good night to you too.
855
00:41:51,710 --> 00:41:54,795
"We don't want to import
your cancer".
856
00:42:06,391 --> 00:42:09,594
Those of you
857
00:42:09,595 --> 00:42:12,799
who didn't want to assist
the Barclays deal,
858
00:42:12,800 --> 00:42:16,102
you can breathe
a sigh of relief.
859
00:42:16,103 --> 00:42:18,170
The deal's not
gonna happen.
860
00:42:18,171 --> 00:42:20,573
- Hank, we have the money.
- The deal's dead.
861
00:42:20,574 --> 00:42:23,876
The British regulator
won't sign off.
862
00:42:23,877 --> 00:42:25,544
There must be some
pressure you can exert.
863
00:42:25,545 --> 00:42:28,181
Trust me, I've done
everything I can.
864
00:42:28,182 --> 00:42:31,685
The British...
865
00:42:31,686 --> 00:42:34,704
they grin-fucked us.
866
00:42:37,192 --> 00:42:39,160
Pason's got
100,000 employees.
867
00:42:39,161 --> 00:42:41,162
Geithner has
200 lawyers.
868
00:42:41,163 --> 00:42:43,198
Freaking Chris Cox
has 3000 people.
869
00:42:43,199 --> 00:42:46,258
Not a single one of those assholes
could pick up a phone,
870
00:42:46,259 --> 00:42:48,837
call the British, find out if
they're was a deal to be made
871
00:42:48,838 --> 00:42:51,940
before they spend the weekend was
sweating us for cash?
872
00:42:51,941 --> 00:42:53,942
Somebody dropped
the ball.
873
00:42:53,943 --> 00:42:55,877
They didn't
drop the ball.
874
00:42:55,878 --> 00:42:57,946
They dropped the ball,
kicked the coach in the nuts
875
00:42:57,947 --> 00:42:59,915

and took a crap in
the quarterback's mouth.
876
00:42:59,916 --> 00:43:02,167
Of course.
877
00:43:03,552 --> 00:43:06,271
The Fed will do
something.
878
00:43:07,490 --> 00:43:09,241
They have to.
879
00:43:13,831 --> 00:43:15,832
We've got to announce
the Lehman bankruptcy now.
880
00:43:15,833 --> 00:43:17,834
If Asia opens and
this isn't locked down,
881
00:43:17,835 --> 00:43:19,702
everyone's gonna
assume the worst.
882
00:43:19,703 --> 00:43:21,871
The selloff will kill
the Merrill-B of A deal.
883
00:43:21,872 --> 00:43:24,340
- Who's gonna make the announcement?
- I think it's gotta be S.E.C.
884
00:43:24,341 --> 00:43:25,741
Yeah.
885
00:43:25,742 --> 00:43:28,260
Okay.
886
00:43:30,980 --> 00:43:34,082
Let's do it here.
How soon can we set that up?
887
00:43:34,083 --> 00:43:35,551
Right away.
888
00:43:35,552 --> 00:43:38,221

We could use the main floor,
the entrance hall.
889
00:43:38,222 --> 00:43:41,073
With the statue behind me?
Excellent.
890
00:43:44,961 --> 00:43:47,846
Did Lehman actually
agree to file?
891
00:43:56,139 --> 00:43:58,040
Chris, call Lehman.
892
00:43:58,041 --> 00:43:59,708
Make sure they file
right now.
893
00:43:59,709 --> 00:44:01,693
Absolutely.
894
00:44:13,357 --> 00:44:15,658
A.I.G.'s a huge problem.
895
00:44:15,659 --> 00:44:18,094
The books are a mess.
But from what I can tell,
896
00:44:18,095 --> 00:44:21,163
half the banks in the world
are in bed with these guys.
897
00:44:21,164 --> 00:44:23,532
Everyone who had a
piece-of-crap mortgage security
898
00:44:23,533 --> 00:44:25,668
bought insurance
on their risk from A.I.G.,
899
00:44:25,669 --> 00:44:27,103
and I mean everyone.
900
00:44:27,104 --> 00:44:29,639
How could they
let this happen?
901
00:44:29,640 --> 00:44:33,610
They must have figured
real estate would never go down, ever.
902
00:44:33,611 --> 00:44:36,630
Hank, Lehman still
hasn't filed.
903
00:44:38,516 --> 00:44:41,518
Cox has to make his announcement.
Asia's opening.
904
00:44:41,519 --> 00:44:43,853
Has he talked to them?
905
00:44:43,854 --> 00:44:46,289
He hasn't even
called yet.
906
00:44:46,290 --> 00:44:48,859
We told Fuld about Barclays.
We said Cox was gonna call.
907
00:44:48,860 --> 00:44:50,827
He's got his entire board
sitting there...
908
00:44:50,828 --> 00:44:52,696
no call.
909
00:44:52,697 --> 00:44:54,664
Cox is like a deer
in the headlights.
910
00:44:54,665 --> 00:44:56,917
Son of a bitch!
911
00:45:02,641 --> 00:45:06,377
You are their regulator.
Call the Lehman board now.
912
00:45:06,378 --> 00:45:09,246
Hank, this is a complicated
situation where...
913
00:45:09,247 --> 00:45:11,148
Asia's opening.
914
00:45:11,149 --> 00:45:12,950
They don't announce...
market goes in the toilet.
915
00:45:12,951 --> 00:45:16,020
We have to consider the
appropriate role of government here.
916
00:45:16,021 --> 00:45:18,489
Can I as chairman of S.E.C.
move forward and...?
917
00:45:18,490 --> 00:45:20,991
You guys are like the gang
that can't shoot straight.
918
00:45:20,992 --> 00:45:23,327
This is your job.
919
00:45:23,328 --> 00:45:26,913
Make the damn
phone call.
920
00:45:33,672 --> 00:45:35,807
Chris, this is
Dick Fuld.
921
00:45:35,808 --> 00:45:37,875
The board is in session.
Everyone is here...
922
00:45:37,876 --> 00:45:40,511
all the directors
and the firm's counsel.
923
00:45:40,512 --> 00:45:42,313
We understand
924
00:45:42,314 --> 00:45:44,816
the Barclays deal
has imploded.
925
00:45:44,817 --> 00:45:49,087
We were hoping you might
have some option
926
00:45:49,088 --> 00:45:51,622

that we haven't
thought of yet.
927
00:45:51,623 --> 00:45:55,026
Uh, the markets are
in turmoil, as you know.
928
00:45:55,027 --> 00:45:57,695
A Lehman bankruptcy
will help
929
00:45:57,696 --> 00:46:00,532
settle that uncertainty
and, we believe, calm the market.
930
00:46:00,533 --> 00:46:03,368
Both the Fed and SEC
are in agreement about this.
931
00:46:03,369 --> 00:46:05,055
Well, let me under...
932
00:46:05,056 --> 00:46:06,537
I'm sorry, let me see
if I understand this.
933
00:46:06,538 --> 00:46:08,806
Are... are you
directing us
934
00:46:08,807 --> 00:46:11,375
to put Lehman
into bankruptcy?
935
00:46:11,376 --> 00:46:13,260
Give us a moment.
936
00:46:14,379 --> 00:46:16,297
- He's muted.
- What the hell was that?
937
00:46:19,284 --> 00:46:21,552
Tell them to file.
938
00:46:21,553 --> 00:46:24,689
Everything said in that meeting
is or will be public record.
939
00:46:24,690 --> 00:46:27,057
I can't tell a private company
to file for bankruptcy.
940
00:46:27,058 --> 00:46:28,760
I don't have
that power.
941
00:46:28,761 --> 00:46:31,345
Do I?
942
00:46:33,732 --> 00:46:35,983
Do it.
943
00:46:47,579 --> 00:46:50,981
The decision to file
for bankruptcy protection
944
00:46:50,982 --> 00:46:54,051
is one the board
needs to make.
945
00:46:54,052 --> 00:46:56,754
It is not the government's
decision.
946
00:46:56,755 --> 00:46:59,574
But we do believe...
947
00:47:01,427 --> 00:47:03,428
That the situation
should be resolved.
948
00:47:03,429 --> 00:47:05,964
So you're not
directing us to file?
949
00:47:05,965 --> 00:47:08,266
I'm not saying anything more
than I've just said.
950
00:47:08,267 --> 00:47:10,018
Thank you.
951
00:47:23,248 --> 00:47:25,700
Take the vote.
952
00:47:27,019 --> 00:47:29,154
- Mr. Akers.
- Yes.
953
00:47:29,155 --> 00:47:32,424
Sir Christopher.
954
00:47:32,425 --> 00:47:33,591
Yes.
955
00:47:33,592 --> 00:47:35,860
Admiral Evans.
956
00:47:35,861 --> 00:47:39,230
I'm sorry, but yes.
957
00:47:39,231 --> 00:47:41,716
Chairman Fuld.
958
00:47:43,770 --> 00:47:46,021
Dick?
959
00:47:51,311 --> 00:47:53,896
Yes.
960
00:47:55,883 --> 00:47:58,017
Mr. Hernandez.
961
00:47:58,018 --> 00:48:00,553
Yes.
962
00:48:00,554 --> 00:48:02,722
Mr. Ainslie.
963
00:48:02,723 --> 00:48:04,524
Yes.
964
00:48:04,525 --> 00:48:07,561
- Mr. Berlind.
- Yes.
965
00:48:07,562 --> 00:48:10,063
- Mr. Cruikshank.
- Yes.
966
00:48:10,064 --> 00:48:13,032
- Dr. Kaufman.
- Yes.
967
00:48:13,033 --> 00:48:16,719
Mr. Macomber.
968
00:48:17,838 --> 00:48:19,605
P?
969
00:48:19,606 --> 00:48:23,109
- Lehman's gone.
- Oh honey.
970
00:48:23,110 --> 00:48:25,111
I should have know the British
were gonna be a problem.
971
00:48:25,112 --> 00:48:27,797
I spoke to them two days ago.
I should have read between the lines.
972
00:48:30,651 --> 00:48:33,119
You can't
take all this on.
973
00:48:33,120 --> 00:48:36,156
There's a lot of
other people involved.
974
00:48:36,157 --> 00:48:38,992
It's on me.
I'm Treasury Secretary
975
00:48:38,993 --> 00:48:41,428
and the fourth largest
investment bank in the country
976
00:48:41,429 --> 00:48:44,164
failed on my watch.
977
00:48:44,165 --> 00:48:47,934
I mean, I... I...
978
00:48:47,935 --> 00:48:50,954
I don't know
what's gonna happen.
979
00:48:52,941 --> 00:48:55,358
Miss you too.
980
00:49:40,388 --> 00:49:42,872
Taxi.
981
00:49:56,139 --> 00:49:58,741
Jim, I'm at Midtown.
982
00:49:58,742 --> 00:50:02,112
The ticker is...
983
00:50:02,113 --> 00:50:04,448
what the hell
am I looking at?
984
00:50:04,449 --> 00:50:06,934
Hank, it's good.
985
00:50:11,657 --> 00:50:13,793
"It is oddly reassuring
986
00:50:13,794 --> 00:50:16,697
that the Treasury Department
and the Federal Reserve
987
00:50:16,698 --> 00:50:18,266
let Lehman Brothers fail".
988
00:50:18,267 --> 00:50:20,268
Oh, okay, here it is.
Here it is.
989
00:50:20,269 --> 00:50:22,637
Government intervention
would have been seen
990
00:50:22,638 --> 00:50:24,440
a sign of extreme peril
991
00:50:24,441 --> 00:50:26,475
in the global
financial system
992
00:50:26,476 --> 00:50:29,446
or extreme weakness
on the part of federal regulators".
993
00:50:29,447 --> 00:50:31,648
"The New York"
fucking "Times".
994
00:50:31,649 --> 00:50:34,618
Yeah, and it's not just them.
It's everybody.
995
00:50:34,619 --> 00:50:38,289
Thank you, Senator.
I appreciate it.
996
00:50:38,290 --> 00:50:40,725
Congress is liking it.
997
00:50:40,726 --> 00:50:42,927
I'm not sure they should be
so happy about this,
998
00:50:42,928 --> 00:50:45,997
but they like
that we let Lehman go.
999
00:50:45,998 --> 00:50:49,200
You stood strong.
You've got brass balls.
1000
00:50:49,201 --> 00:50:51,336
It's what people need
at a time like this.
1001
00:50:51,337 --> 00:50:53,471
What is
the market doing?
1002
00:50:53,472 --> 00:50:55,205
Uh, Europe's only down
a little.
1003
00:50:55,206 --> 00:50:57,106
Dow Jones futures
only off 3%.
1004
00:50:57,107 --> 00:50:59,340
So you need to build on this
at the press conference.

1005
00:50:59,341 --> 00:51:02,542
The story is we did everything
we could for Lehman.
1006
00:51:02,543 --> 00:51:04,277
- We did.
- And the takeaway is...
1007
00:51:04,278 --> 00:51:07,012
No more bailouts.
1008
00:51:07,013 --> 00:51:08,680
Mr. Secretary.
1009
00:51:08,681 --> 00:51:10,581
How should we read
what happened with Lehman?
1010
00:51:10,582 --> 00:51:12,616
Read it as
I think it's important
1011
00:51:12,617 --> 00:51:15,085
to maintain
the stability
1012
00:51:15,086 --> 00:51:18,755
and orderliness
of our financial system;
1013
00:51:18,756 --> 00:51:23,861
and, um, the...
1014
00:51:23,862 --> 00:51:27,231
Moral hazard is something
I don't take lightly.
1015
00:51:27,232 --> 00:51:29,332
Mr. Paulson.
Mr. Secretary, sir.
1016
00:51:29,333 --> 00:51:32,703
How do you see the health
of the banking system today?
1017
00:51:32,704 --> 00:51:34,738

The way the markets
are performing today...
1018
00:51:34,739 --> 00:51:37,842
it's a testament to how the
financial industry has come together
1019
00:51:37,843 --> 00:51:39,977
in an extraordinary set
of circumstances.
1020
00:51:39,978 --> 00:51:41,980
The American people
can remain confident
1021
00:51:41,981 --> 00:51:44,383
in the soundness
and the resilience
1022
00:51:44,384 --> 00:51:46,685
of the financial
system.
1023
00:51:46,686 --> 00:51:48,253
Thank you all.
1024
00:51:48,254 --> 00:51:50,989
Mr. Secretary.
Mr. Paulson.
1025
00:51:50,990 --> 00:51:53,158
What?
1026
00:51:53,159 --> 00:51:55,961
Dow's falling off a cliff...
400 points already.
1027
00:51:55,962 --> 00:51:58,062
And the credit markets
are frozen.
1028
00:51:58,063 --> 00:52:00,931
Goldman and Morgan Stanley
are getting slammed by withdrawals.
1029
00:52:00,932 --> 00:52:03,250
The Lehman thing's
killing them.
1030
00:52:04,536 --> 00:52:06,404
I should talk
to the President
1031
00:52:06,405 --> 00:52:09,006
about how we'll contain
the damage.
1032
00:52:09,007 --> 00:52:11,509
Before you speak
to the President,
1033
00:52:11,510 --> 00:52:13,828
we've had
another problem.
1034
00:52:15,046 --> 00:52:16,713
A.I.G.
1035
00:52:16,714 --> 00:52:19,249
Mr. Geithner is
working with A.I.G.
1036
00:52:19,250 --> 00:52:21,084
on a private-sector
solution
1037
00:52:21,085 --> 00:52:23,086
and the Secretary
is monitoring
1038
00:52:23,087 --> 00:52:25,022
their progress
very carefully.
1039
00:52:25,023 --> 00:52:29,660
He's in close contact with the
Congressional leadership, most...
1040
00:52:29,661 --> 00:52:31,529
the White House wants
a briefing on A.I.G.
1041
00:52:31,530 --> 00:52:33,365
They're more informed
about that than we are.
1042
00:52:33,366 --> 00:52:35,032
We've got the same
information they do.
1043
00:52:35,033 --> 00:52:38,035
No, we don't believe
that Lehman's bankruptcy
1044
00:52:38,036 --> 00:52:40,071
is taking down
all of Wall Street.
1045
00:52:40,072 --> 00:52:41,940
Okay, so how do you explain...?
1046
00:52:41,941 --> 00:52:43,943
The A.I.G. situation
may have been,
1047
00:52:43,944 --> 00:52:46,713
you know,
exacerbated by the...
1048
00:52:46,714 --> 00:52:48,831
and Barney Frank's
office.
1049
00:52:49,917 --> 00:52:51,184
Yeah.
1050
00:52:51,185 --> 00:52:54,554
A surprise?
No, A.I.G. has been struggling...
1051
00:52:54,555 --> 00:52:57,623
Well, why didn't you guys head
off this situation six months ago?
1052
00:52:57,624 --> 00:53:01,425
Because the requisite
magic wand wasn't available, Doug.
1053
00:53:01,426 --> 00:53:03,226
But if we do find one,
1054
00:53:03,227 --> 00:53:05,811
you will be among

the very first to know.
1055
00:53:06,563 --> 00:53:08,931
Blankfein on four,
urgent.
1056
00:53:08,932 --> 00:53:11,400
I have to go.
1057
00:53:11,401 --> 00:53:12,968
Hey Lloyd.
1058
00:53:12,969 --> 00:53:15,303
The goddamn British
bankruptcy administrator
1059
00:53:15,304 --> 00:53:17,606
froze all of Lehman's
customer accounts.
1060
00:53:17,607 --> 00:53:20,244
You didn't square this with
the British before you did it?
1061
00:53:20,245 --> 00:53:21,879
Geithner on five.
1062
00:53:21,880 --> 00:53:23,614
People are freaking out.
1063
00:53:23,615 --> 00:53:25,649
They can't get
their money.
1064
00:53:25,650 --> 00:53:28,018
Not investors...
clients.
1065
00:53:28,019 --> 00:53:30,654
If customers think their money
wasn't safe with Lehman,
1066
00:53:30,655 --> 00:53:32,489
they're not gonna
trust us either.
1067
00:53:32,490 --> 00:53:35,759

No one will do
business with us.
1068
00:53:35,760 --> 00:53:37,493
You're gonna have
to hang on.
1069
00:53:37,494 --> 00:53:38,925
Tim.
1070
00:53:38,926 --> 00:53:41,394
Dan spoke to Moody's.
They're downgrading A.I.G. tonight.
1071
00:53:41,395 --> 00:53:44,862
Would have happened anyway, but Lehman
put the whole thing into hyperdrive.
1072
00:53:44,863 --> 00:53:46,463
How far down
are they?
1073
00:53:46,464 --> 00:53:48,131
French finance minster
on six.
1074
00:53:48,132 --> 00:53:50,399
They don't know.
1075
00:53:50,400 --> 00:53:53,068
We're working on that.
1076
00:53:53,069 --> 00:53:54,935
Christine.
1077
00:53:54,936 --> 00:53:56,803
How could you let this
happen with Lehman?
1078
00:53:56,804 --> 00:53:58,438
What on earth
were you thinking?
1079
00:53:58,439 --> 00:54:01,273
We did everything
we could, Christine.
1080
00:54:01,274 --> 00:54:03,508
You allowed it
to fail, Hank.
1081
00:54:03,509 --> 00:54:05,310
It was a horrifying
mistake.
1082
00:54:05,311 --> 00:54:08,011
It is having catastrophic
consequences all over Europe.
1083
00:54:08,012 --> 00:54:10,213
And A.I.G. would be
even worse.
1084
00:54:10,214 --> 00:54:13,815
The European banks have
tremendous exposure to A.I.G.
1085
00:54:13,816 --> 00:54:17,317
We need assurance you will not
fail to act as you did with Lehman.
1086
00:54:17,318 --> 00:54:20,169
It is not just
an American problem.
1087
00:54:21,354 --> 00:54:22,820
Thank you so much for...
1088
00:54:22,821 --> 00:54:24,088
John Mack.
1089
00:54:24,089 --> 00:54:25,622
Hey... uh...
1090
00:54:25,623 --> 00:54:27,874
- John.
- Secretary: John... one.
1091
00:54:28,892 --> 00:54:32,161
The fallout from Lehman
is killing us.
1092
00:54:32,162 --> 00:54:34,430
The short-sellers
are all over us.

1093
00:54:34,431 --> 00:54:35,964
We're down
10% already.
1094
00:54:35,965 --> 00:54:38,466
You guys have no idea
what's going on out here.
1095
00:54:38,467 --> 00:54:40,968
How are your earnings?
1096
00:54:40,969 --> 00:54:43,537
Strong. We're gonna
announce Friday.
1097
00:54:43,538 --> 00:54:44,955
Announce now.
1098
00:54:46,374 --> 00:54:48,542
Okay, Lloyd, sorry.
1099
00:54:48,543 --> 00:54:51,645
Hank, if depositors see they can't
get their assets out of Lehman,
1100
00:54:51,646 --> 00:54:53,647
the next step is gonna be
a massive pullout
1101
00:54:53,648 --> 00:54:55,816
from all the investment banks.
1102
00:54:55,817 --> 00:54:57,568
Jeff Immelt from G.E.
1103
00:54:58,788 --> 00:55:01,222
Jesus, what's Immelt
calling you for?
1104
00:55:01,223 --> 00:55:03,092
I have to go.
1105
00:55:03,093 --> 00:55:04,527
Jeff.
1106
00:55:04,528 --> 00:55:06,662
You gotta know
what's going on out here.
1107
00:55:06,663 --> 00:55:09,932
We're having trouble funding
our day-to-day operations.
1108
00:55:09,933 --> 00:55:13,469
Our finance division is infecting
the rest of our business.
1109
00:55:13,470 --> 00:55:15,337
General Electric?
1110
00:55:15,338 --> 00:55:18,473
This thing is spreading
way past Wall Street.
1111
00:55:18,474 --> 00:55:21,109
I get that nobody wants
to touch mortgages,
1112
00:55:21,110 --> 00:55:24,245
but we're making planes
and engines, and light bulbs.
1113
00:55:24,246 --> 00:55:26,714
We're a healthy company.
1114
00:55:26,715 --> 00:55:29,784
If we can't finance
our day-to-day operations,
1115
00:55:29,785 --> 00:55:33,405
every business in America's
gonna be shutting down.
1116
00:55:40,829 --> 00:55:43,063
Where's A.I.G.?
1117
00:55:43,064 --> 00:55:44,398
It closed at $2.
1118
00:55:44,399 --> 00:55:46,833
Tim thinks we need
to do something big.
1119
00:55:46,834 --> 00:55:48,268
Ben agrees,
and so do I.
1120
00:55:48,269 --> 00:55:50,303
What can we do?
A.I.G.'s not even a bank.
1121
00:55:50,304 --> 00:55:52,305
The Fed can lend
to nonbanks
1122
00:55:52,306 --> 00:55:55,041
under unusual and
exigent circumstances.
1123
00:55:55,042 --> 00:55:58,930
We're thinking of taking over
80% of the company.
1124
00:56:01,050 --> 00:56:03,618
Hank, we can't.
1125
00:56:03,619 --> 00:56:06,722
This morning we were lecturing
the entire country on moral hazard.
1126
00:56:06,723 --> 00:56:09,558
A.I.G. has collateral.
They have assets.
1127
00:56:09,559 --> 00:56:12,995
Lehman didn't.
We couldn't lend into a hole.
1128
00:56:12,996 --> 00:56:14,797
It's not
the same story.
1129
00:56:14,798 --> 00:56:16,766
Nobody's gonna care.
1130
00:56:16,767 --> 00:56:19,569
It's another bailout
with no legislation.
1131
00:56:19,570 --> 00:56:21,771

The Hill's gonna go crazy.
The country's gonna go crazy.
1132
00:56:21,772 --> 00:56:23,806
The plane that we
flew in on this morning...
1133
00:56:23,807 --> 00:56:25,774
leased from A.I.G.
1134
00:56:25,775 --> 00:56:28,010
Construction downtown...
A.I.G.
1135
00:56:28,011 --> 00:56:30,980
Life insurance...
81 million policies
1136
00:56:30,981 --> 00:56:33,316
with a face value
of $1.9 trillion,
1137
00:56:33,317 --> 00:56:36,619
billions of dollars in teachers' pensions...
it's everywhere.
1138
00:56:36,620 --> 00:56:39,221
You want too big to fail?
Here it is.
1139
00:56:39,222 --> 00:56:41,223
You got a better idea?
1140
00:56:41,224 --> 00:56:43,541
The suggestion box
is wide open.
1141
00:56:50,132 --> 00:56:52,734
I hate to do this
right now,
1142
00:56:52,735 --> 00:56:55,070
but I'm gonna have to have
a press call first thing,
1143
00:56:55,071 --> 00:56:57,139
and I really don't know
what I'm gonna tell them.

1144
00:56:57,140 --> 00:56:59,810
Tell them Lehman
exacerbated A.I.G.,
1145
00:56:59,811 --> 00:57:02,513
the simultaneous
payouts of C.D.O.s
1146
00:57:02,514 --> 00:57:05,149
and credit default swaps
put catastrophic pressure on...
1147
00:57:05,150 --> 00:57:08,353
Go back further.
1148
00:57:08,354 --> 00:57:10,655
The global pool
of investment capital...
1149
00:57:10,656 --> 00:57:12,790
she has to do this
in English.
1150
00:57:12,791 --> 00:57:14,925
Start with
the homeowners.
1151
00:57:14,926 --> 00:57:17,894
Okay okay, here's how
you explain it.
1152
00:57:17,895 --> 00:57:22,465
Wall Street
started bundling
1153
00:57:22,466 --> 00:57:24,601
home loans together...
mortgage-backed securities...
1154
00:57:24,602 --> 00:57:27,905
and selling slices
of those bundles to investors.
1155
00:57:27,906 --> 00:57:30,174
And they were making
big money,
1156
00:57:30,175 --> 00:57:32,443
so they started pushing
the lenders, saying,
1157
00:57:32,444 --> 00:57:34,512
"come on,
we need more loans.
1158
00:57:34,513 --> 00:57:36,516
The lenders had
already given loans
1159
00:57:36,517 --> 00:57:38,520
to borrowers
with good credit,
1160
00:57:38,521 --> 00:57:41,090
so they go bottom-feeding.
They lower their criteria.
1161
00:57:41,091 --> 00:57:43,793
Before, you needed
a credit score of 620
1162
00:57:43,794 --> 00:57:45,996
and a downpayment
of 20%.
1163
00:57:45,997 --> 00:57:48,532
Now they'll settle for 500,
no money down.
1164
00:57:48,533 --> 00:57:50,767
And the buyer...
the regular guy on the street...
1165
00:57:50,768 --> 00:57:52,569
assumes that the experts
know what they're doing.
1166
00:57:52,570 --> 00:57:55,172
He's saying to himself,
"if the bank's willing to loan me money,
1167
00:57:55,173 --> 00:57:56,940
I must be able
to afford it".
1168
00:57:56,941 --> 00:57:59,276
So he reaches for
the American dream.
1169
00:57:59,277 --> 00:58:00,844
He buys that house.
1170
00:58:00,845 --> 00:58:04,080
The banks knew securities based on
shitbag mortgages were risky.
1171
00:58:04,081 --> 00:58:05,549
You'll work on "shitbag".
1172
00:58:05,550 --> 00:58:07,117
So to control
their downside,
1173
00:58:07,118 --> 00:58:08,952
the banks started buying
a kind of insurance.
1174
00:58:08,953 --> 00:58:12,089
If mortgages default,
insurance company pays...
1175
00:58:12,090 --> 00:58:13,890
default swap.
1176
00:58:13,891 --> 00:58:16,059
The banks insure
their potential losses
1177
00:58:16,060 --> 00:58:17,861
to move the risk
off their books
1178
00:58:17,862 --> 00:58:20,196
so they can invest more,
make more money.
1179
00:58:20,197 --> 00:58:22,400
And when a lot of companies
insured this stuff,
1180
00:58:22,401 --> 00:58:25,936
one was dumb enough to take on

an almost unbelievable amount of risk.
1181
00:58:25,937 --> 00:58:28,405
- A.I.G.
- And you'll work on "dumb".
1182
00:58:28,406 --> 00:58:30,640
And when they ask me
why they did that?
1183
00:58:30,641 --> 00:58:33,009
- Fees.
- Hundreds of millions in fees.
1184
00:58:33,010 --> 00:58:35,612
A.I.G. figured the housing market
would just keep going up,
1185
00:58:35,613 --> 00:58:37,080
but then
the unexpected happens.
1186
00:58:37,081 --> 00:58:39,249
Housing prices
go down.
1187
00:58:39,250 --> 00:58:41,084
The poor bastard who
bought his dream house...
1188
00:58:41,085 --> 00:58:43,253
the teaser rate on his
mortgage runs out.
1189
00:58:43,254 --> 00:58:45,855
His payments go up.
He defaults.
1190
00:58:45,856 --> 00:58:47,657
Mortgage-backed
securities tank.
1191
00:58:47,658 --> 00:58:49,626
A.I.G. has to pay off
the swaps...
1192
00:58:49,627 --> 00:58:51,896
all of them
all over the world
1193
00:58:51,897 --> 00:58:53,931
at the same time.
1194
00:58:53,932 --> 00:58:57,067
A.I.G. can't pay.
A.I.G. goes under.
1195
00:58:57,068 --> 00:58:59,469
Every bank
they insure
1196
00:58:59,470 --> 00:59:03,307
books massive losses
on the same day.
1197
00:59:03,308 --> 00:59:05,509
And then they all
go under.
1198
00:59:05,510 --> 00:59:08,028
It all comes down.
1199
00:59:08,880 --> 00:59:11,531
The whole financial system?
1200
00:59:16,187 --> 00:59:18,490
And what do I say
1201
00:59:18,491 --> 00:59:21,259
when they ask me
why it wasn't regulated?
1202
00:59:21,260 --> 00:59:25,129
No one wanted to.
1203
00:59:25,130 --> 00:59:28,616
We were making
too much money.
1204
00:59:38,344 --> 00:59:40,311
You'll work on
1205
00:59:40,312 --> 00:59:43,064
"we were making
too much money".

1206
00:59:55,262 --> 00:59:57,563
Hey, Hank,
1207
00:59:57,564 --> 01:00:00,099
um...
1208
01:00:00,100 --> 01:00:02,134
These are
really mild,
1209
01:00:02,135 --> 01:00:04,270
but they work.
1210
01:00:04,271 --> 01:00:07,406
I know the whole
Christian Scientist thing...
1211
01:00:07,407 --> 01:00:10,643
that you don't
take medicine.
1212
01:00:10,644 --> 01:00:13,462
But you need
to sleep.
1213
01:00:15,349 --> 01:00:17,084
Jim...
1214
01:00:17,085 --> 01:00:19,419
Hank, not just
for your own sake.
1215
01:00:19,420 --> 01:00:21,671
Okay?
1216
01:00:25,593 --> 01:00:27,878
You don't look
so good.
1217
01:00:32,300 --> 01:00:34,868
Just minutes ago
CNN has confirmed
1218
01:00:34,869 --> 01:00:37,137
that the Federal Reserve
is negotiating
1219
01:00:37,138 --> 01:00:39,506
to rescue
insurance giant AIG
1220
01:00:39,507 --> 01:00:41,509
The negotiations
could include
1221
01:00:41,510 --> 01:00:43,978
an $85 billion
temporary loan
1222
01:00:43,979 --> 01:00:46,182
to stave off
AIG's imminent collapse.
1223
01:00:46,183 --> 01:00:47,816
This is a blockbuster,
folks.
1224
01:00:47,817 --> 01:00:50,319
About this time last night,
many on Wall Street
1225
01:00:50,320 --> 01:00:52,487
were fearing
total disaster today.
1226
01:00:52,488 --> 01:00:54,488
So another
federal bailout...
1227
01:00:54,489 --> 01:00:56,390
of another
Wall Street giant...
1228
01:00:56,391 --> 01:00:58,959
again, as we mentioned,
big big financial news.
1229
01:00:58,960 --> 01:01:02,629
And this affects almost everyone
out there who has a 401k.
1230
01:01:02,630 --> 01:01:04,498
The news comes about
3 and 1/2 hours...

1231
01:01:04,499 --> 01:01:06,867
after the stock exchange
closed on...
1232
01:01:06,868 --> 01:01:09,636
Motherfucker.
1233
01:01:09,637 --> 01:01:11,705
We want to go straight
right now to Ali Velshi
1234
01:01:11,706 --> 01:01:13,874
to kind of give us
a bottom line on this, Ali.
1235
01:01:13,875 --> 01:01:16,043
And then we're gonna get
a lot more in depth...
1236
01:01:16,044 --> 01:01:17,745
AIG securing an 85...
1237
01:01:17,746 --> 01:01:19,746
The credit markets
are still frozen solid.
1238
01:01:19,747 --> 01:01:21,749
We keep dumping money
into these companies
1239
01:01:21,750 --> 01:01:24,986
so the markets
will stabilize,
1240
01:01:24,987 --> 01:01:26,454
and nothing helps.
1241
01:01:26,455 --> 01:01:29,123
We can't keep
doing this.
1242
01:01:29,124 --> 01:01:31,759
We rescued Bear
with no legislation,
1243
01:01:31,760 --> 01:01:35,196

A.I.G. with no legislation.
1244
01:01:35,197 --> 01:01:37,598
People think Fannie and Freddie
was a bait-and-switch.
1245
01:01:37,599 --> 01:01:39,200
I don't like it
any more than you do,
1246
01:01:39,201 --> 01:01:41,135
but they were
exceptional situations.
1247
01:01:41,136 --> 01:01:44,172
This situation
demands an endgame
1248
01:01:44,173 --> 01:01:47,441
that does not rely on
unilateral action from the Fed.
1249
01:01:47,442 --> 01:01:49,109
This is a democracy.
1250
01:01:49,110 --> 01:01:51,746
We cannot be men behind the
curtain pulling the strings.
1251
01:01:51,747 --> 01:01:53,915
We need some kind of
an overall solution
1252
01:01:53,916 --> 01:01:56,284
that heals
the entire system.
1253
01:01:56,285 --> 01:01:58,486
And it has to be
legitimate.
1254
01:01:58,487 --> 01:02:00,121
We've been putting off
going to Congress.
1255
01:02:00,122 --> 01:02:02,057
It's two months
before an election.
1256
01:02:02,058 --> 01:02:05,260
They can't vote yes
to a massive bailout
1257
01:02:05,261 --> 01:02:07,028
of the entire
banking system.
1258
01:02:07,029 --> 01:02:08,530
They'd never get
reelected.
1259
01:02:08,531 --> 01:02:10,532
- Hank...
- We go to Congress,
1260
01:02:10,533 --> 01:02:13,135
publically state
we don't have the firepower
1261
01:02:13,136 --> 01:02:15,637
to control this
anymore,
1262
01:02:15,638 --> 01:02:17,673
and then they say no...
1263
01:02:17,674 --> 01:02:21,810
that is really
the nightmare scenario.
1264
01:02:21,811 --> 01:02:26,415
The nightmare scenario's
already here, my friend.
1265
01:02:26,416 --> 01:02:29,935
We're in it.
1266
01:03:29,113 --> 01:03:31,364
P.
1267
01:03:42,126 --> 01:03:44,194
You can't put this all
on your own shoulders.
1268
01:03:44,195 --> 01:03:45,929

We're running out
of options.
1269
01:03:45,930 --> 01:03:48,498
Then you just
keep trying.
1270
01:03:48,499 --> 01:03:50,634
That's what you do.
1271
01:03:50,635 --> 01:03:52,802
Eventually
something's gonna work.
1272
01:03:52,803 --> 01:03:55,772
I'm not sure that
that is true anymore.
1273
01:03:55,773 --> 01:03:58,341
There's not a bank
in the world
1274
01:03:58,342 --> 01:04:00,343
that has enough money
in its vault
1275
01:04:00,344 --> 01:04:01,844
to pay
its depositors.
1276
01:04:01,845 --> 01:04:04,481
It's all built
on trust.
1277
01:04:04,482 --> 01:04:06,784
And...
and, Wendy, we...
1278
01:04:06,785 --> 01:04:10,504
we are
so very close.
1279
01:04:13,291 --> 01:04:17,061
Morgan Stanley, Goldman
are an inch away.
1280
01:04:17,062 --> 01:04:19,830
If the other banks

stop trusting them,
1281
01:04:19,831 --> 01:04:22,833
if they pull back
on interbank lending,
1282
01:04:22,834 --> 01:04:25,135
it's over
in a matter of hours.
1283
01:04:25,136 --> 01:04:27,671
And from there
it goes
1284
01:04:27,672 --> 01:04:29,673
too fast to stop...
a run...
1285
01:04:29,674 --> 01:04:32,442
and not just
on that one bank.
1286
01:04:32,443 --> 01:04:34,445
I mean,
on the whole system.
1287
01:04:34,446 --> 01:04:37,348
And average people
wondering,
1288
01:04:37,349 --> 01:04:39,816
"is my money safe?"
1289
01:04:39,817 --> 01:04:42,868
They start pulling
their cash.
1290
01:04:44,688 --> 01:04:46,655
And after that...
1291
01:04:46,656 --> 01:04:49,926
lines outside the banks,
smashed A.T.M.s.
1292
01:04:49,927 --> 01:04:53,330
A couple of weeks...
1293
01:04:53,331 --> 01:04:56,333
there's no milk
in the store.
1294
01:04:56,334 --> 01:04:58,235
For the second time
this week
1295
01:04:58,236 --> 01:05:00,070
there was a massive selloff
on Wall Street,
1296
01:05:00,071 --> 01:05:03,675
the Dow Jones Industrials
freefalling some 450 points
1297
01:05:03,676 --> 01:05:05,677
on news of
a taxpayer-funded bailout
1298
01:05:05,678 --> 01:05:07,612
of the A.I.G.
Insurance company.
1299
01:05:07,613 --> 01:05:10,014
Three of the five
investment banks are gone.
1300
01:05:10,015 --> 01:05:12,450
The country's biggest
mortgage lender is gone.
1301
01:05:12,451 --> 01:05:15,220
Fannie Mae and Freddie Mac
brought under government control.
1302
01:05:15,221 --> 01:05:17,356
The financial system
is holding right now,
1303
01:05:17,357 --> 01:05:18,992
but for how long?
1304
01:05:18,993 --> 01:05:21,662
All the King's horses
and all the King's men
1305
01:05:21,663 --> 01:05:24,214

are being brought to bear
to keep this thing together.
1306
01:05:50,688 --> 01:05:51,854
Hi Tim.
1307
01:05:51,855 --> 01:05:53,822
I'm on the street, Hank,
1308
01:05:53,823 --> 01:05:56,024
and people are just
going about their business.
1309
01:05:56,025 --> 01:05:59,361
They have no idea the whole
thing is about to fall down.
1310
01:05:59,362 --> 01:06:01,930
We're gonna have to
go to Congress.
1311
01:06:01,931 --> 01:06:03,531
We don't have
a choice anymore.
1312
01:06:03,532 --> 01:06:05,233
Okay.
1313
01:06:05,234 --> 01:06:07,267
How fast do you think
you can get them to move?
1314
01:06:07,268 --> 01:06:09,469
It's gonna be at least
a couple days.
1315
01:06:09,470 --> 01:06:12,706
Goldman and Morgan Stanley
are going down now.
1316
01:06:12,707 --> 01:06:14,408
We gotta do
something today.
1317
01:06:14,409 --> 01:06:15,609
Like what?
1318
01:06:15,610 --> 01:06:17,745
The market doesn't like
investment banks, right?
1319
01:06:17,746 --> 01:06:20,180
The money's saying fuck you
to the whole business model.
1320
01:06:20,181 --> 01:06:21,715
Yeah.
1321
01:06:21,716 --> 01:06:24,819
Yeah, so merge them
with commercial banks,
1322
01:06:24,820 --> 01:06:26,955
turn them into regular banks
regulated by the Fed.
1323
01:06:26,956 --> 01:06:28,690
They can use
depositors' cash.
1324
01:06:28,691 --> 01:06:30,693
It will give them access
to the discount window.
1325
01:06:30,694 --> 01:06:33,662
It's cheap government cash.
1326
01:06:33,663 --> 01:06:36,565
- You want to make them bigger?
- It's a trade-off, Hank.
1327
01:06:36,566 --> 01:06:40,503
The upside is
it'll stabilize them.
1328
01:06:40,504 --> 01:06:43,072
The downside is,
1329
01:06:43,073 --> 01:06:47,076
yeah, they'll be
really fucking big.
1330
01:06:47,077 --> 01:06:49,429
Do it, Tim.
1331
01:06:51,249 --> 01:06:53,267
Godspeed.
1332
01:07:10,473 --> 01:07:13,192
Get me Blankfein.
1333
01:07:14,544 --> 01:07:16,846
Lloyd, call Vikram Pandit,
talk to him about a merger.
1334
01:07:16,847 --> 01:07:18,882
Tim, we're looking
at all our options.
1335
01:07:18,883 --> 01:07:20,885
You don't have
options, Lloyd.
1336
01:07:20,886 --> 01:07:22,386
There's a run
on your bank.
1337
01:07:22,387 --> 01:07:24,256
You need money...
Citi has deposits.
1338
01:07:24,257 --> 01:07:27,276
Citi is a mess...
you're organized. Call Pandit.
1339
01:07:36,539 --> 01:07:37,904
Yeah.
1340
01:07:37,905 --> 01:07:39,608
I want you to look at merging
with Morgan Stanley.
1341
01:07:39,609 --> 01:07:41,577
What, are you kidding me?
I just bought Bear.
1342
01:07:41,578 --> 01:07:43,212
We're still trying
to make that work.
1343
01:07:43,213 --> 01:07:45,348
You didn't buy Bear.

You got Bear as a Christmas present.
1344
01:07:45,349 --> 01:07:47,217
The market's a fucking
disaster, Jamie.
1345
01:07:47,218 --> 01:07:49,386
Talk to John Mack.
1346
01:07:49,387 --> 01:07:52,156
Hey, Geithner says
we should talk about a merger.
1347
01:07:52,157 --> 01:07:54,292
- You want to do a deal?
- No.
1348
01:07:54,293 --> 01:07:56,462
Then why the fuck did he
tell me to call you?
1349
01:07:56,463 --> 01:07:58,698
I'm under orders
to try and help you.
1350
01:07:58,699 --> 01:08:02,252
You're a prince, Jamie...
a real prince.
1351
01:08:05,640 --> 01:08:07,942
Apparently some people
seem to think
1352
01:08:07,943 --> 01:08:10,178
combining our firms
would be a good idea.
1353
01:08:10,179 --> 01:08:13,148
Well, I want you to know
I'm flattered by this call.
1354
01:08:13,149 --> 01:08:15,317
Vikram,
I'm not trying
1355
01:08:15,318 --> 01:08:17,419
to flatter you,
believe me.
1356
01:08:17,420 --> 01:08:19,021
Geithner's calling.
1357
01:08:19,022 --> 01:08:21,424
Oh, here comes
goddamn eharmony.
1358
01:08:21,425 --> 01:08:24,044
Hey, guess what.
Jaime's not interested.
1359
01:08:25,797 --> 01:08:27,966
Do Wachovia.
1360
01:08:27,967 --> 01:08:30,134
They were writing mortgages
with their eyes closed.
1361
01:08:30,135 --> 01:08:32,453
Tim, it's a shit sandwich.
Forget it.
1362
01:08:37,975 --> 01:08:40,210
Well, I haven't been
able to reach you for four hours.
1363
01:08:40,211 --> 01:08:43,614
That is... that is totally fucking
unacceptable on a day like today.
1364
01:08:43,615 --> 01:08:46,583
I had to run my team
through the Goldman proposal.
1365
01:08:46,584 --> 01:08:48,251
It's not gonna work.
1366
01:08:48,252 --> 01:08:51,688
You passed on Goldman
without even talking to me?
1367
01:08:51,689 --> 01:08:55,008
I don't need another trillion
dollars on my balance sheet.
1368
01:08:58,596 --> 01:09:02,816

Next time I call,
pick up.
1369
01:09:03,568 --> 01:09:05,736
Fucker.
1370
01:09:05,737 --> 01:09:08,872
The problem is the toxic assets.
Let's just buy them.
1371
01:09:08,873 --> 01:09:11,141
Ooh, call it
cash-for-trash.
1372
01:09:11,142 --> 01:09:13,875
When the market stabilizes,
we'll unload them.
1373
01:09:13,876 --> 01:09:15,976
Hopefully Treasury will
get its money back.
1374
01:09:15,977 --> 01:09:18,512
- Is that in the break-the-glass plan?
- Basically.
1375
01:09:18,513 --> 01:09:20,523
My copy's missing some pages.
1376
01:09:20,524 --> 01:09:21,866
Could someone else show me
the rest of...
1377
01:09:21,867 --> 01:09:24,014
It's succinct.
1378
01:09:24,015 --> 01:09:26,216
We've got one shot
with Congress.
1379
01:09:26,217 --> 01:09:29,884
You want them to write a piece
of legislation based on three pages?
1380
01:09:29,885 --> 01:09:31,252
Look, guys,
1381
01:09:31,253 --> 01:09:33,519
buying toxic assets
is gonna be a nightmare.
1382
01:09:33,520 --> 01:09:35,353
Nobody knows what
the stuff's worth.
1383
01:09:35,354 --> 01:09:38,154
It'll take forever to untangle.
These banks are going down now.
1384
01:09:38,155 --> 01:09:39,321
So what do we do?
1385
01:09:39,322 --> 01:09:41,023
You want to unfreeze
credit, right?
1386
01:09:41,024 --> 01:09:42,658
You want the banks
to lend people money?
1387
01:09:42,659 --> 01:09:45,745
- That's the goal.
- So give them money to lend.
1388
01:09:47,999 --> 01:09:49,933
Capital injections?
1389
01:09:49,934 --> 01:09:51,524
Dan, come on.
1390
01:09:51,525 --> 01:09:52,926
I can't believe you're
pulling out the "n" word.
1391
01:09:52,927 --> 01:09:54,206
I'm not saying
nationalize the banks.
1392
01:09:54,207 --> 01:09:55,438
I'm saying isolate the ones
1393
01:09:55,439 --> 01:09:57,440
that are really in trouble
and make an investment.
1394
01:09:57,441 --> 01:09:58,841
It's unamerican.
1395
01:09:58,842 --> 01:10:00,809
It's... it's sure
unrepublican.
1396
01:10:00,810 --> 01:10:03,311
You make the government
a stockholder...
1397
01:10:03,312 --> 01:10:05,113
what, do we tell them
1398
01:10:05,114 --> 01:10:07,716
how to manage themselves,
what to buy and sell?
1399
01:10:07,717 --> 01:10:09,558
Run them like the post Office?
1400
01:10:09,559 --> 01:10:10,751
'Cause that works
like a dream.
1401
01:10:10,752 --> 01:10:12,251
We make it
temporary.
1402
01:10:12,252 --> 01:10:14,819
We make ourselves
nonvoting stockholders.
1403
01:10:14,820 --> 01:10:17,888
You can't just hand the banks
massive piles of cash.
1404
01:10:17,889 --> 01:10:19,756
Nobody's gonna
go for it.
1405
01:10:19,757 --> 01:10:21,557
To the Republican's
it's nationalization.
1406
01:10:21,558 --> 01:10:23,358
To the Democrats
it's a bailout.
1407
01:10:23,359 --> 01:10:25,426
And the banks are
gonna go ballistic.
1408
01:10:25,427 --> 01:10:28,262
Sorry, Dan,
not gonna happen.
1409
01:10:28,263 --> 01:10:30,229
Kudos for
out-of-the-box thinking.
1410
01:10:30,230 --> 01:10:32,964
Neel, if we go with your
plan to buy the assets,
1411
01:10:32,965 --> 01:10:35,298
how much is it
gonna cost?
1412
01:10:35,299 --> 01:10:36,699
It won't work.
1413
01:10:36,700 --> 01:10:40,135
Look, the plan is
three pages long, totally vague.
1414
01:10:40,136 --> 01:10:42,069
If buying the assets
doesn't work,
1415
01:10:42,070 --> 01:10:44,038
we'll nationalize
the banks for you, okay?
1416
01:10:44,039 --> 01:10:45,506
How much?
1417
01:10:45,507 --> 01:10:48,775
To be safe,
maybe a trillion.
1418
01:10:48,776 --> 01:10:52,110
The Congress will never do
a trillion... never.
1419
01:10:52,111 --> 01:10:55,747
Well, there's $11 trillion
in residential mortgages.
1420
01:10:55,748 --> 01:10:58,282
There's $3 trillion
in commercial mortgages.
1421
01:10:58,283 --> 01:11:00,984
That's $14 trillion,
right?
1422
01:11:00,985 --> 01:11:03,953
You gotta figure
about 5% default rate.
1423
01:11:03,954 --> 01:11:06,788
5% of $14 trillion
1424
01:11:06,789 --> 01:11:11,207
is $700 billion.
1425
01:11:13,761 --> 01:11:16,812
It's better
than a trillion.
1426
01:11:19,464 --> 01:11:21,397
The only way
to get this done
1427
01:11:21,398 --> 01:11:23,432
is to just
scare them shitless.
1428
01:11:23,433 --> 01:11:27,216
That should be easy.
I'm scared shitless myself.
1429
01:11:38,941 --> 01:11:42,043
Troubled Asset
Relief Program?
1430
01:11:42,044 --> 01:11:43,744
T.A.R.P.
We're calling it.
1431
01:11:43,745 --> 01:11:46,245

This is your draft
of the bill?
1432
01:11:46,246 --> 01:11:49,731
Subject to revision
certainly.
1433
01:11:51,249 --> 01:11:53,283
Well, I've only got
three pages here.
1434
01:11:53,284 --> 01:11:54,784
Am I missing something?
1435
01:11:54,785 --> 01:11:56,169
No.
1436
01:11:57,987 --> 01:12:01,321
You're just looking for a
big blank check in a hurry.
1437
01:12:01,322 --> 01:12:04,824
It's all for the banks.
You don't want a penny
1438
01:12:04,825 --> 01:12:07,292
for the average Joe
that's about to lose his house?
1439
01:12:07,293 --> 01:12:09,395
There's not a scrap of oversight
built into this...
1440
01:12:09,396 --> 01:12:11,897
not for the banks
or for you for that matter.
1441
01:12:11,898 --> 01:12:13,899
You want us
to simply hand over
1442
01:12:13,900 --> 01:12:17,135
$700 billion
and trust you?
1443
01:12:17,136 --> 01:12:19,937
How is it possible
you didn't see this coming?

1444
01:12:19,938 --> 01:12:22,039
If you want to rewind the tape,
we can do that.
1445
01:12:22,040 --> 01:12:25,375
But right now the one thing
we don't have is time.
1446
01:12:25,376 --> 01:12:28,044
We need an announcement tonight
to calm the market.
1447
01:12:28,045 --> 01:12:30,330
We need legislation
next week.
1448
01:12:33,451 --> 01:12:38,322
I spent my entire
academic career
1449
01:12:38,323 --> 01:12:41,642
studying
the Great Depression.
1450
01:12:43,095 --> 01:12:45,329
The Depression
may have started
1451
01:12:45,330 --> 01:12:47,698
because of
a stock market crash,
1452
01:12:47,699 --> 01:12:50,969
but what hit
the general economy
1453
01:12:50,970 --> 01:12:52,904
was a disruption
of credit...
1454
01:12:52,905 --> 01:12:54,973
average citizens
unable to borrow money
1455
01:12:54,974 --> 01:12:57,208
to do anything...
to buy a home,
1456
01:12:57,209 --> 01:13:01,479
start a business,
stock their shelves.
1457
01:13:01,480 --> 01:13:05,082
Credit has the ability
to build a modern economy,
1458
01:13:05,083 --> 01:13:07,452
but lack of credit
has the power to destroy it,
1459
01:13:07,453 --> 01:13:10,038
swiftly and absolutely.
1460
01:13:11,724 --> 01:13:14,661
If we do not act
boldly and immediately,
1461
01:13:14,662 --> 01:13:17,798
we will replay
the Depression of the 1930s,
1462
01:13:17,799 --> 01:13:21,269
only this time
it will be
1463
01:13:21,270 --> 01:13:24,223
far far worse.
1464
01:13:25,175 --> 01:13:27,177
We don't
do this now...
1465
01:13:27,178 --> 01:13:30,898
we won't have
an economy on Monday.
1466
01:13:38,795 --> 01:13:40,646
Geithner.
1467
01:13:45,271 --> 01:13:47,206
We took the proposal
down to Congress.
1468
01:13:47,207 --> 01:13:48,441

Are they gonna
go for it?
1469
01:13:48,442 --> 01:13:50,243
They didn't like the fact
that it was short.
1470
01:13:50,244 --> 01:13:52,979
I thought concise was a plus.
They thought it was flimsy
1471
01:13:52,980 --> 01:13:55,448
or arrogant
or something.
1472
01:13:55,449 --> 01:13:58,384
I don't know what they think.
They couldn't get past it.
1473
01:13:58,385 --> 01:14:00,820
The market's in a death spiral.
They're gonna sink the bill
1474
01:14:00,821 --> 01:14:02,622
because the proposal
is too fucking short?
1475
01:14:02,623 --> 01:14:06,192
They're working on it.
They're gonna make it longer,
1476
01:14:06,193 --> 01:14:08,394
among other things.
1477
01:14:08,395 --> 01:14:10,764
Look,
1478
01:14:10,765 --> 01:14:12,849
just tell me
you got something.
1479
01:14:15,203 --> 01:14:18,606
No.
No, we're nowhere.
1480
01:14:18,607 --> 01:14:20,207
Who's left
for Morgan Stanley?

1481
01:14:20,208 --> 01:14:24,361
China Investment
Corporation.
1482
01:14:25,380 --> 01:14:27,680
Mae Mitsubishi.
1483
01:14:27,681 --> 01:14:30,317
No, the Japanese will
never do this deal.
1484
01:14:30,318 --> 01:14:31,919
How about Goldman?
1485
01:14:31,920 --> 01:14:34,823
Goldman's looking at Wachovia,
but they're so fucked,
1486
01:14:34,824 --> 01:14:36,975
even John Mack
turned up his nose.
1487
01:14:39,596 --> 01:14:41,631
You gotta get
that bill passed.
1488
01:14:41,632 --> 01:14:42,899
I'm pushing.
1489
01:14:42,900 --> 01:14:44,901
Well, push harder,
1490
01:14:44,902 --> 01:14:47,554
please.
1491
01:14:48,740 --> 01:14:52,192
This isn't working, Hank.
1492
01:15:05,791 --> 01:15:07,993
Hank?
1493
01:15:07,994 --> 01:15:10,446
Could you excuse me
a moment?
1494
01:15:31,556 --> 01:15:33,625
Oh my God.
1495
01:15:33,626 --> 01:15:36,395
GAO, GAO,
1496
01:15:36,396 --> 01:15:39,732
I am so sorry about this.
There's nothing we can do.
1497
01:15:39,733 --> 01:15:41,734
It's New York, you know.
We're lucky
1498
01:15:41,735 --> 01:15:44,037
we can still buy a beer
at Yankee Stadium.
1499
01:15:44,038 --> 01:15:46,807
Don't worry about it.
I should quit anyway.
1500
01:15:46,808 --> 01:15:49,361
When you're ready,
we'll be inside.
1501
01:15:52,850 --> 01:15:54,650
Is there any
movement there?
1502
01:15:54,651 --> 01:15:56,887
They made an extremely
low opening offer.
1503
01:15:56,888 --> 01:15:59,225
I pretended
I didn't hear it.
1504
01:15:59,226 --> 01:16:01,261
The markets
can't open Monday
1505
01:16:01,262 --> 01:16:03,697
without a resolution
on Morgan Stanley.
1506
01:16:03,698 --> 01:16:06,200
We really need you

to do a deal.
1507
01:16:06,201 --> 01:16:08,568
- You need to call Jamie.
- I called Jamie.
1508
01:16:08,569 --> 01:16:10,802
He doesn't want us.
There's too much overlap.
1509
01:16:10,803 --> 01:16:12,203
We've spoken to him.
He'll do it.
1510
01:16:12,204 --> 01:16:14,906
For what, a dollar?
Why would I do that?
1511
01:16:14,907 --> 01:16:16,574
I got
China Investment
1512
01:16:16,575 --> 01:16:18,343
and Mitsubishi
kicking my tires.
1513
01:16:18,344 --> 01:16:21,913
I know those guys. They're not
gonna close a deal in time.
1514
01:16:21,914 --> 01:16:25,116
We want you
to call Jamie.
1515
01:16:25,117 --> 01:16:26,952
Let me ask you
a question.
1516
01:16:26,953 --> 01:16:29,955
35,000 jobs just
disappeared in this city
1517
01:16:29,956 --> 01:16:32,157
between A.I.G.,
Lehman and Bear.
1518
01:16:32,158 --> 01:16:33,659
We make a deal
with Jamie...
1519
01:16:33,660 --> 01:16:36,729
he'll fire 20,000
Morgan Stanley employees.
1520
01:16:36,730 --> 01:16:38,897
You think that's good
public policy?
1521
01:16:38,898 --> 01:16:42,367
John, we are looking
at the whole system here.
1522
01:16:42,368 --> 01:16:44,343
The Chinese are leaving.
1523
01:16:44,344 --> 01:16:45,904
GAO found out we're also
talking to Mitsubishi.
1524
01:16:45,905 --> 01:16:47,673
I gotta go.
1525
01:16:47,674 --> 01:16:51,243
All right, get me Kuroyanagi
and a Japanese translator.
1526
01:16:51,244 --> 01:16:53,279
We're closing with
Mitsubishi tonight.
1527
01:16:53,280 --> 01:16:55,915
Tim Geithner's
calling again.
1528
01:16:55,916 --> 01:16:57,443
Cover your ears.
1529
01:16:57,444 --> 01:16:59,152
You tell Tim Geithner
to fucking blow me.
1530
01:16:59,153 --> 01:17:01,470
I'm trying to save
my company.
1531
01:17:03,823 --> 01:17:06,759
Put him on the schedule,
but make sure it's after lunch,
1532
01:17:06,760 --> 01:17:09,863
because that way I can
fit Maddle in beforehand.
1533
01:17:09,864 --> 01:17:12,867
Morgan just made a deal
with Mitsubishi.
1534
01:17:12,868 --> 01:17:14,869
So we're
the only bank
1535
01:17:14,870 --> 01:17:17,205
with our dick
still in the wind.
1536
01:17:17,206 --> 01:17:20,559
I'm calling
Buffett again.
1537
01:17:25,083 --> 01:17:27,485
Grandpa, they keep calling.
What if it's important?
1538
01:17:27,486 --> 01:17:30,071
They always think
it's important.
1539
01:17:32,225 --> 01:17:35,911
All right,
I'll make it fast.
1540
01:17:37,164 --> 01:17:39,199
Warren, thanks for calling back.
How are you?
1541
01:17:39,200 --> 01:17:41,234
Just fine, Lloyd.
1542
01:17:41,235 --> 01:17:42,933
What can I do
for you today?
1543
01:17:42,934 --> 01:17:45,633

I'd like to talk to you about
taking a stake in Goldman Sachs.
1544
01:17:45,634 --> 01:17:48,301
What do you have in mind?
Sounds expensive.
1545
01:17:48,302 --> 01:17:50,619
Maybe not.
1546
01:17:52,238 --> 01:17:54,806
You'd better have
good news,
1547
01:17:54,807 --> 01:17:57,106
because I might be dead
before we finish
1548
01:17:57,107 --> 01:17:59,307
haggling over TARP.
1549
01:17:59,308 --> 01:18:02,393
Buffett's throwing
$5 billion into Goldman.
1550
01:18:05,280 --> 01:18:07,848
We're off the ledge.
1551
01:18:07,849 --> 01:18:09,917
For a moment.
1552
01:18:09,918 --> 01:18:12,553
The October surprise
arrived a little early
1553
01:18:12,554 --> 01:18:15,323
with a game-changing jolt
to the White House race.
1554
01:18:15,324 --> 01:18:17,291
Call it a master stroke
1555
01:18:17,292 --> 01:18:19,327
or a desperate
Hail-Mary pass...
1556
01:18:19,328 --> 01:18:22,598

McCain announced he would
suspend his campaign
1557
01:18:22,599 --> 01:18:25,735
and asked for this Friday's
debate to be postponed
1558
01:18:25,736 --> 01:18:29,006
So he can return to Washington
to focus on the economic crisis.
1559
01:18:29,007 --> 01:18:32,176
Now is our chance
to come together,
1560
01:18:32,177 --> 01:18:34,912
to prove that Washington
is once again
1561
01:18:34,913 --> 01:18:38,115
capable of leading
this country.
1562
01:18:38,116 --> 01:18:41,018
Thank God he came back.
1563
01:18:41,019 --> 01:18:45,221
Like Daniel Day Lewis
in "Last of the Mohicans,"
1564
01:18:45,222 --> 01:18:48,007
he will find us!
1565
01:18:49,494 --> 01:18:51,761
- They're blowing it up.
- What happened?
1566
01:18:51,762 --> 01:18:53,496
McCain wanted to swoop in
and save the day,
1567
01:18:53,497 --> 01:18:55,131
but doesn't have any idea
how to do it.
1568
01:18:55,132 --> 01:18:57,066
It's 100-page
piece of legislation
1569
01:18:57,067 --> 01:18:59,135
we've been carefully
negotiating for days.
1570
01:18:59,136 --> 01:19:01,337
What, did he think they were
gonna sit around and spitball?
1571
01:19:01,338 --> 01:19:03,306
Yeah, when McCain
got here
1572
01:19:03,307 --> 01:19:06,609
and found out that the deal
was basically done, he went apeshit.
1573
01:19:06,610 --> 01:19:08,511
The Republicans fell in
behind their guy.
1574
01:19:08,512 --> 01:19:10,246
They want to start
all over again.
1575
01:19:10,247 --> 01:19:12,515
Democrats flipped out.
Republicans dug in.
1576
01:19:12,516 --> 01:19:14,950
Clusterfuck.
1577
01:19:14,951 --> 01:19:18,288
- Where's Hank?
- Still talking to McCain.
1578
01:19:18,289 --> 01:19:20,724
If you or anyone else
does anything
1579
01:19:20,725 --> 01:19:24,261
that causes a depression,
it is not gonna be on me.
1580
01:19:24,262 --> 01:19:26,888
I have a big mouth, Senator...
1581
01:19:26,889 --> 01:19:28,064
- a very big mouth.
- Hold on...
1582
01:19:28,065 --> 01:19:30,533
He's not threatening
1583
01:19:30,534 --> 01:19:33,002
the Republican
Presidential Nominee, is he?
1584
01:19:33,003 --> 01:19:35,504
- Something's got to be done.
- No no. Excuse me, please.
1585
01:19:35,505 --> 01:19:37,506
Where are the Democrats?
1586
01:19:37,507 --> 01:19:39,341
They're right down
this way.
1587
01:19:39,342 --> 01:19:40,909
- Is Nancy there?
- Yes. Yes, she is.
1588
01:19:40,910 --> 01:19:42,361
Thank you.
1589
01:19:49,920 --> 01:19:52,004
Nancy...
1590
01:19:55,524 --> 01:19:57,826
Gee, Hank.
1591
01:19:57,827 --> 01:19:59,877
I didn't know
you were Catholic.
1592
01:20:01,362 --> 01:20:03,497
I beg of you, don't blow this up.
It was a bad meeting,
1593
01:20:03,498 --> 01:20:05,566
but we need to get
together on this.
1594
01:20:05,567 --> 01:20:07,568
We're not the ones
trying to blow it up.
1595
01:20:07,569 --> 01:20:10,189
I just ask you
to stay with us.
1596
01:20:12,142 --> 01:20:15,345
Please.
1597
01:20:15,346 --> 01:20:17,180
The House began debating
the rescue bill
1598
01:20:17,181 --> 01:20:18,682
at 9:27 this morning.
1599
01:20:18,683 --> 01:20:21,484
At about 1:28 pm
Congress did finally act.
1600
01:20:21,485 --> 01:20:23,820
- This is a squeaker of a vote.
- We are down to it right now.
1601
01:20:23,821 --> 01:20:26,089
It looks like the Democrats
delivered their caucus
1602
01:20:26,090 --> 01:20:28,292
and the Republicans
so far have not.
1603
01:20:28,293 --> 01:20:30,527
What do you think they could do
to change the bill
1604
01:20:30,528 --> 01:20:32,429
to get a few Republican votes
over to the other side?
1605
01:20:32,430 --> 01:20:34,231
If they hang
Wall Street CEOs,
1606
01:20:34,232 --> 01:20:35,666
I think that would get

a few more votes.
1607
01:20:35,667 --> 01:20:37,467
You know, I'm not...
I'm not sure
1608
01:20:37,468 --> 01:20:39,369
what they could do
exactly.
1609
01:20:39,370 --> 01:20:42,773
It is possible that the leadership
of the Congress would conclude
1610
01:20:42,774 --> 01:20:45,777
that there's nothing that can
get a majority of support
1611
01:20:45,778 --> 01:20:48,662
and see what Hank Paulson can do
and the administration can do...
1612
01:20:50,448 --> 01:20:52,516
Leaders are negotiating
right now
1613
01:20:52,517 --> 01:20:54,751
who'll risk their seats.
And that's what I'm hearing.
1614
01:20:54,752 --> 01:20:57,308
Pelosi wouldn't have brought
the bill to the floor if she
1615
01:20:57,309 --> 01:20:58,486
didn't think it would pass.
1616
01:20:58,487 --> 01:21:00,091
I don't know the answer
to that, Charlie. I can't answer.
1617
01:21:00,092 --> 01:21:02,093
I'm just reading an email
that's coming to me.
1618
01:21:02,094 --> 01:21:03,497
I think the bottom line
1619
01:21:03,498 --> 01:21:04,629
is they gotta go back
to the drawing board.
1620
01:21:04,630 --> 01:21:06,330
Do they have the time
though to do that?
1621
01:21:06,331 --> 01:21:08,063
Look at the Dow Jones
Industrial Average.
1622
01:21:08,064 --> 01:21:09,998
Well, you know,
you're gonna get a...
1623
01:21:09,999 --> 01:21:11,133
At this point we just
1624
01:21:11,134 --> 01:21:12,535
gotta hold on to the sides
of the kayak
1625
01:21:12,536 --> 01:21:14,001
and ride through this
because...
1626
01:21:14,002 --> 01:21:15,969
They didn't pass it.
1627
01:21:15,970 --> 01:21:18,004
- They did not pass it.
- It just wasn't enough.
1628
01:21:18,005 --> 01:21:22,207
They're gonna end up being
nine votes short, Bill.
1629
01:21:22,208 --> 01:21:23,908
Say that again, Steve.
1630
01:21:23,909 --> 01:21:25,842
I think they're gonna end up
being nine votes...
1631
01:21:25,843 --> 01:21:28,110
if they get all six...

five of the remaining votes,
1632
01:21:28,111 --> 01:21:32,013
they'll be 10 votes short now...
if they get all five remaining.
1633
01:21:32,014 --> 01:21:33,747
The writing is
on the wall there.
1634
01:21:33,748 --> 01:21:35,915
And we're here
down on the floor.
1635
01:21:35,916 --> 01:21:38,400
Traders have been standing around.
We're all here in knots.
1636
01:21:42,691 --> 01:21:46,196
The networks are waiting for you
in the press room.
1637
01:21:46,197 --> 01:21:49,349
I can't even...
1638
01:22:01,114 --> 01:22:03,148
We have to
go back again.
1639
01:22:03,149 --> 01:22:05,768
They don't get
to say no on this.
1640
01:22:06,519 --> 01:22:08,187
Okay.
1641
01:22:08,188 --> 01:22:09,356
The White House
wants a meeting.
1642
01:22:09,357 --> 01:22:11,358
Good. We'll come up
with a new strategy.
1643
01:22:11,359 --> 01:22:13,427
The White House has to
push harder on the Hill.
1644
01:22:13,428 --> 01:22:16,296
Meanwhile we need to keep working
on what we do with the money.
1645
01:22:16,297 --> 01:22:17,798
Let's act like
this is gonna work.
1646
01:22:17,799 --> 01:22:19,632
In that case, let's talk
about cash injections.
1647
01:22:19,633 --> 01:22:20,869
Here we go again.
1648
01:22:20,870 --> 01:22:22,201
We can't nationalize
the banks.
1649
01:22:22,202 --> 01:22:23,298
It's not nationali...
1650
01:22:23,299 --> 01:22:24,869
That's how Japan got itself
a decade-long recession.
1651
01:22:24,870 --> 01:22:27,371
Is that where
we want to go?
1652
01:22:27,372 --> 01:22:29,573
What else do we have?
1653
01:22:29,574 --> 01:22:31,132
Cash-for-trash.
1654
01:22:31,133 --> 01:22:33,183
Buying toxic assets
is still our go-to move.
1655
01:22:33,811 --> 01:22:37,280
All right.
Find a way to simplify it.
1656
01:22:37,281 --> 01:22:40,184
Dan, work something up.
1657
01:22:40,185 --> 01:22:43,438
For discussion purposes,
let's see what it would look like.
1658
01:22:54,201 --> 01:22:57,003
For those who supported the
$700 billion Wall Street bailout,
1659
01:22:57,004 --> 01:22:59,239
it was a surprising
and stunning failure
1660
01:22:59,240 --> 01:23:01,574
when the House of Representatives
voted to reject it.
1661
01:23:01,575 --> 01:23:04,043
It's a stinging defeat
for President Bush
1662
01:23:04,044 --> 01:23:06,781
delivered at the hands
of his fellow Republicans.
1663
01:23:06,782 --> 01:23:10,251
We put forth a plan
that was big
1664
01:23:10,252 --> 01:23:12,019
because we've got
a big problem.
1665
01:23:12,020 --> 01:23:15,957
The reality is that we're
in an urgent situation.
1666
01:23:15,958 --> 01:23:19,227
and the consequences
will grow worse each day
1667
01:23:19,228 --> 01:23:20,695
if we do not act.
1668
01:23:20,696 --> 01:23:22,196
I know.
I keep telling...
1669
01:23:22,197 --> 01:23:23,698
draft of
the new bill.
1670
01:23:23,699 --> 01:23:25,333
Are they having
any luck with it?
1671
01:23:25,334 --> 01:23:27,903
The White House thinks they
got a better shot of pushing it
1672
01:23:27,904 --> 01:23:30,506
through the Senate side first.
Hopefully they're right.
1673
01:23:30,507 --> 01:23:32,474
They asked us to back off
and let them handle it.
1674
01:23:32,475 --> 01:23:35,529
So I'm... I'm...
I'm trying to back off.
1675
01:23:40,418 --> 01:23:43,287
Buying toxic assets
isn't gonna work.
1676
01:23:43,288 --> 01:23:44,888
Why not?
1677
01:23:44,889 --> 01:23:46,455
It's too slow.
1678
01:23:46,456 --> 01:23:47,923
I think I've been
saying that.
1679
01:23:47,924 --> 01:23:49,924
Well, we knew it was complicated,
but how slow...?
1680
01:23:49,925 --> 01:23:51,426
Two months,
maybe more.
1681
01:23:51,427 --> 01:23:52,834
Oh.
1682
01:23:52,835 --> 01:23:54,195
How is it possible
we didn't know how...?
1683
01:23:54,196 --> 01:23:58,465
I didn't ask how long
it would take, okay?
1684
01:23:58,466 --> 01:24:00,834
Can we move on?
1685
01:24:00,835 --> 01:24:04,638
So maybe we can talk about
capital injections.
1686
01:24:04,639 --> 01:24:06,540
Dan, we really can't.
1687
01:24:06,541 --> 01:24:08,709
I think
we're gonna have to.
1688
01:24:08,710 --> 01:24:11,245
Even if neel could
expedite the process,
1689
01:24:11,246 --> 01:24:14,815
which seems unlikely,
1690
01:24:14,816 --> 01:24:16,817
the system
is crumbling.
1691
01:24:16,818 --> 01:24:19,553
The banks need
money now.
1692
01:24:19,554 --> 01:24:23,090
If cash injections are the most
efficient way to stabilize them,
1693
01:24:23,091 --> 01:24:26,259
then we can't back off
1694
01:24:26,260 --> 01:24:28,261
because we're uncomfortable

being the men
1695
01:24:28,262 --> 01:24:30,597
who nationalized
a few American banks.
1696
01:24:30,598 --> 01:24:32,266
It's faster,
that's for sure.
1697
01:24:32,267 --> 01:24:34,368
It will push us back
off the precipice, yes,
1698
01:24:34,369 --> 01:24:37,972
unfreeze the system.
1699
01:24:37,973 --> 01:24:40,741
We give them some money
1700
01:24:40,742 --> 01:24:44,194
and they lend it out.
1701
01:24:47,916 --> 01:24:49,416
The motion is adopted.
1702
01:24:49,417 --> 01:24:51,785
After rejecting the Bush
Administration's T.A.R.P. Plan
1703
01:24:51,786 --> 01:24:54,422
only four days ago,
the House passed it today.
1704
01:24:54,423 --> 01:24:56,283
The big question now...
1705
01:24:56,284 --> 01:24:58,126
whether investors will take
comfort in the news.
1706
01:24:58,127 --> 01:25:00,128
Current indicators show
the stock market
1707
01:25:00,129 --> 01:25:03,315
is continuing
its freefall.
1708
01:25:21,519 --> 01:25:22,885
Hello.
1709
01:25:22,886 --> 01:25:25,221
Warren, it's Hank.
1710
01:25:25,222 --> 01:25:28,324
I... I... I'm sorry.
It's late.
1711
01:25:28,325 --> 01:25:30,661
Am I waking you?
1712
01:25:30,662 --> 01:25:33,130
No, not at all.
1713
01:25:33,131 --> 01:25:35,299
Can I pick your brain
for a minute?
1714
01:25:35,300 --> 01:25:38,101
Sure.
What's the problem?
1715
01:25:38,102 --> 01:25:41,272
How do you get
a healthy bank...
1716
01:25:41,773 --> 01:25:44,791
to accept
a capital injection?
1717
01:26:38,665 --> 01:26:41,167
I had to drag my ass
all the way here from California.
1718
01:26:41,168 --> 01:26:43,102
They wouldn't even
tell my why.
1719
01:26:43,103 --> 01:26:45,004
Nobody knows
what this is about?
1720
01:26:45,005 --> 01:26:47,256

Nope.
1721
01:26:52,279 --> 01:26:53,980
Talk to Jamie?
1722
01:26:53,981 --> 01:26:56,250
Yep. He'll be fine.
1723
01:26:56,251 --> 01:26:58,119
Did you tell him
what was coming?
1724
01:26:58,120 --> 01:27:00,255
Uh, did I tell him we're about
to make him swallow
1725
01:27:00,256 --> 01:27:03,625
a capital injection
he doesn't need? No.
1726
01:27:03,626 --> 01:27:06,328
I... I told him
we need his help
1727
01:27:06,329 --> 01:27:09,916
and I asked him very politely
not to fuck with us today.
1728
01:27:11,135 --> 01:27:12,619
He got it.
1729
01:27:13,771 --> 01:27:15,989
She's here.
1730
01:27:20,813 --> 01:27:22,814
Gentlemen.
1731
01:27:22,815 --> 01:27:24,584
We think this is
gonna work?
1732
01:27:24,585 --> 01:27:27,103
Oh yeah.
They're gonna love it.
1733
01:27:49,079 --> 01:27:51,047
We are of the view

1734
01:27:51,048 --> 01:27:53,050
that the United States
needs
1735
01:27:53,051 --> 01:27:55,752
to take strong,
decisive action
1736
01:27:55,753 --> 01:27:58,921
to arrest the stress
1737
01:27:58,922 --> 01:28:02,457
in our financial system.
1738
01:28:02,458 --> 01:28:05,526
Through our new
T.A.R.P. Authority,
1739
01:28:05,527 --> 01:28:08,495
Treasury will purchase
1740
01:28:08,496 --> 01:28:10,764
preferred stock
1741
01:28:10,765 --> 01:28:13,849
in each of the banks
represented in this room.
1742
01:28:16,035 --> 01:28:18,503
That stock will yield 5%
the first five years,
1743
01:28:18,504 --> 01:28:21,472
9% after that.
1744
01:28:21,473 --> 01:28:24,174
We give you money;
You lend it out.
1745
01:28:24,175 --> 01:28:27,610
It will unfreeze credit,
stabilize the banks,
1746
01:28:27,611 --> 01:28:29,512
restore confidence.
1747
01:28:29,513 --> 01:28:31,613
Everyone will be
better off
1748
01:28:31,614 --> 01:28:33,648
with more capital
in the system.
1749
01:28:33,649 --> 01:28:35,716
And that is why
1750
01:28:35,717 --> 01:28:39,586
all nine of you
1751
01:28:39,587 --> 01:28:42,605
will participate
in the program.
1752
01:28:45,926 --> 01:28:47,727
Some of us don't need
any capital.
1753
01:28:47,728 --> 01:28:50,231
You all need capital.
1754
01:28:50,232 --> 01:28:52,800
You have no idea what the
market's gonna look like in a year.
1755
01:28:52,801 --> 01:28:54,902
Neither do you.
1756
01:28:54,903 --> 01:28:56,903
I'm not one of you
New York guys
1757
01:28:56,904 --> 01:28:58,872
with your
fancy products.
1758
01:28:58,873 --> 01:29:01,775
Well, why am I in this room
talking about bailing you out?
1759
01:29:01,776 --> 01:29:05,378
The stronger banks will serve
as cover for the weaker banks.

1760
01:29:05,379 --> 01:29:08,014
If just some of you take it,
the money is a signal
1761
01:29:08,015 --> 01:29:11,117
that a bank is too weak to survive.
The market will devour it.
1762
01:29:11,118 --> 01:29:13,853
How much are we
talking about?
1763
01:29:13,854 --> 01:29:16,940
$125 billion.
1764
01:29:18,927 --> 01:29:20,928
Bank of America...
$15 billion.
1765
01:29:20,929 --> 01:29:23,264
Bank of New York Mellon...
$3 billion.
1766
01:29:23,265 --> 01:29:26,800
Citigroup...
$25 billion.
1767
01:29:26,801 --> 01:29:30,137
Goldman Sachs...
$10 billion.
1768
01:29:30,138 --> 01:29:33,474
J.P. Morgan...
$25 billion.
1769
01:29:33,475 --> 01:29:35,743
Merrill Lynch...
$10 billion.
1770
01:29:35,744 --> 01:29:38,278
Morgan Stanley...
$10 billion.
1771
01:29:38,279 --> 01:29:41,448
State Street...
$2 billion.
1772
01:29:41,449 --> 01:29:43,934
Wells Fargo...
$25 billion.
1773
01:29:49,658 --> 01:29:53,327
What happened
to buying toxic assets?
1774
01:29:53,328 --> 01:29:54,929
Wasn't that the idea?
1775
01:29:54,930 --> 01:29:56,464
It's too slow.
1776
01:29:56,465 --> 01:29:58,566
You'll be dead
before we sort it out.
1777
01:29:58,567 --> 01:30:02,002
So we're just handing
the reins over to you?
1778
01:30:02,003 --> 01:30:03,670
The deal's actually
pretty good.
1779
01:30:03,671 --> 01:30:06,340
You turn your nose up at this now,
and we have to rescue you later...
1780
01:30:06,341 --> 01:30:08,141
the terms won't be
nearly as attractive.
1781
01:30:08,142 --> 01:30:10,811
It's cheap capital.
It's not the worst idea in the world.
1782
01:30:10,812 --> 01:30:12,779
Well, it is for those of us
who already have capital.
1783
01:30:12,780 --> 01:30:14,916
We will be nonvoting
shareholders.
1784
01:30:14,917 --> 01:30:17,568

This will be
a temporary measure.
1785
01:30:19,855 --> 01:30:22,022
What if we decline
to be involved?
1786
01:30:22,023 --> 01:30:25,593
The Chairman of the FDIC
is sitting right there.
1787
01:30:25,594 --> 01:30:27,294
Tomorrow you'll
find out
1788
01:30:27,295 --> 01:30:29,697
that you're not as well-capitalized
as you think you are.
1789
01:30:29,698 --> 01:30:31,699
What kind of protections
can you offer on changes
1790
01:30:31,700 --> 01:30:33,333
for compensation policy?
1791
01:30:33,334 --> 01:30:36,203
I mean, if the government
is going to become a part-owner,
1792
01:30:36,204 --> 01:30:38,205
does that mean
that the government
1793
01:30:38,206 --> 01:30:40,774
is going to dictate
compensation?
1794
01:30:40,775 --> 01:30:43,011
Are you asking me about your
bonus right now, John?
1795
01:30:43,012 --> 01:30:45,380
I'm running
a company.
1796
01:30:45,381 --> 01:30:47,382
If the Fed tells me

I can't offer
1797
01:30:47,383 --> 01:30:49,684
competitive pay
for talent,
1798
01:30:49,685 --> 01:30:52,887
you're gonna launch the biggest brain
drain this country's ever seen.
1799
01:30:52,888 --> 01:30:54,755
Is that the way you want
to run the banks?
1800
01:30:54,756 --> 01:30:56,790
Until the money is repaid
to the Treasury,
1801
01:30:56,791 --> 01:31:00,259
there will be some limitations on tax
deductions and golden parachutes.
1802
01:31:00,260 --> 01:31:02,327
- Well, there you go.
- I don't really understand
1803
01:31:02,328 --> 01:31:04,962
why there needs to be
so much tension about this.
1804
01:31:04,963 --> 01:31:06,931
The country is facing
1805
01:31:06,932 --> 01:31:09,466
the worst economy
since the Great Depression.
1806
01:31:09,467 --> 01:31:11,969
If the financial system
collapses,
1807
01:31:11,970 --> 01:31:15,022
it will take
every one of you down.
1808
01:31:23,079 --> 01:31:25,430
Give me the papers.
1809
01:31:32,653 --> 01:31:34,320
- You can't just sign it.
- Oh no?
1810
01:31:34,321 --> 01:31:37,989
- Not without your board.
- My board's on 24-hour notice.
1811
01:31:37,990 --> 01:31:40,259
I think they'll
go along with it.
1812
01:31:40,260 --> 01:31:45,012
And if they don't,
they'll fire me.
1813
01:31:50,304 --> 01:31:53,222
Anyone else?
1814
01:31:58,147 --> 01:32:00,565
Are they gonna do it?
1815
01:32:01,684 --> 01:32:03,352
They're calling
their boards.
1816
01:32:03,353 --> 01:32:05,855
- That's a good sign.
- If they do go along with this,
1817
01:32:05,856 --> 01:32:08,558
we should announce
something alongside the injections...
1818
01:32:08,559 --> 01:32:11,629
maybe a program
to buy up mortgages.
1819
01:32:11,630 --> 01:32:13,365
I'm not rushing out
some half-assed plan
1820
01:32:13,366 --> 01:32:15,167
just to make it look like
we're doing something.
1821
01:32:15,168 --> 01:32:17,604

Maybe we just beef up
the restrictions
1822
01:32:17,605 --> 01:32:20,374
on how they
spend the money...
1823
01:32:20,375 --> 01:32:22,210
something to take
the stink off.
1824
01:32:22,211 --> 01:32:25,030
Put more restrictions on it...
they won't take it.
1825
01:32:29,486 --> 01:32:31,972
One thing too many
for today.
1826
01:32:33,993 --> 01:32:35,961
They almost bring down
1827
01:32:35,962 --> 01:32:37,797
the U.S. economy
as we know it,
1828
01:32:37,798 --> 01:32:40,299
but we can't put restrictions
on how they spend
1829
01:32:40,300 --> 01:32:43,536
the $125 billion
we're giving them,
1830
01:32:43,537 --> 01:32:47,890
because they might not
take it.
1831
01:33:19,273 --> 01:33:21,540
What's this?
1832
01:33:21,541 --> 01:33:25,377
That is, um...
1833
01:33:25,378 --> 01:33:27,913
A poison dart frog.
1834
01:33:27,914 --> 01:33:31,400
Wendy took it
in Guyana.
1835
01:33:43,664 --> 01:33:46,416
Is this yours?
1836
01:33:51,005 --> 01:33:53,489
Al Capone's.
1837
01:33:55,442 --> 01:33:56,976
Eight out of the nine
are in.
1838
01:33:56,977 --> 01:33:59,012
B of A is still waiting
on its board, but...
1839
01:33:59,013 --> 01:34:01,548
it's gonna go through.
1840
01:34:01,549 --> 01:34:04,184
I'll call the Speaker's
office.
1841
01:34:04,185 --> 01:34:07,221
And we're gonna get you
on the phone with the President.
1842
01:34:07,222 --> 01:34:10,174
Okay.
1843
01:34:12,961 --> 01:34:15,796
Dow is up 900 points
1844
01:34:15,797 --> 01:34:18,315
just because
we were meeting.
1845
01:34:20,468 --> 01:34:24,505
Well, that's good.
1846
01:34:24,506 --> 01:34:27,074
That's good.
1847
01:34:27,075 --> 01:34:29,809
It was the right thing.

1848
01:34:29,810 --> 01:34:32,747
Absolutely.
1849
01:34:32,748 --> 01:34:34,716
I was prepared
for more blowback.
1850
01:34:34,717 --> 01:34:37,819
They didn't have
a choice.
1851
01:34:37,820 --> 01:34:40,338
They knew that.
1852
01:34:41,657 --> 01:34:46,428
Well, I certainly hope
that they...
1853
01:34:46,429 --> 01:34:47,846
What?
1854
01:34:49,565 --> 01:34:53,802
I hope they use the money
the way we're asking them to.
1855
01:34:53,803 --> 01:34:58,890
They will... lend it out,
won't they?
1856
01:34:59,976 --> 01:35:02,828
Of course they will.
1857
01:35:14,457 --> 01:35:16,208
Of course they will.

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1

00:00:00,000 --> 00:00:03,400

<i>and global reach.</i>

00:01:03,823 --> 00:01:07,025

00:01:44,392 --> 00:01:47,660

00:02:20,158 --> 00:02:22,493

only a very small fraction

<i>investors are questioning

to raise new capital...</i>

00:04:29,865 --> 00:04:31,933

00:06:08,784 --> 00:06:10,685

00:07:13,674 --> 00:07:16,459

00:07:40,663 --> 00:07:42,197

Right now the street's running

00:08:37,446 --> 00:08:40,147

00:09:16,847 --> 00:09:19,982

00:10:15,798 --> 00:10:18,117

All right, fine.

00:11:40,475 --> 00:11:43,378

00:14:04,837 --> 00:14:07,173

00:15:39,366 --> 00:15:41,400

to the banks too?

00:17:35,334 --> 00:17:38,069

Fannie and Freddie

Mexico told him to shove it.

00:20:19,726 --> 00:20:21,561

00:20:53,287 --> 00:20:56,071

for over six months;

00:24:31,195 --> 00:24:33,162

I'm gonna make the deal.

a great deal of stress.</i>

00:28:45,779 --> 00:28:47,596

00:30:33,545 --> 00:30:34,945

When are we gonna figure out</i>

we're valuing with a dartboard.

00:33:34,988 --> 00:33:38,692

that we'd consider.

00:34:53,456 --> 00:34:55,956

I thought you said

00:38:31,414 --> 00:38:33,182

00:39:20,162 --> 00:39:22,614

are you saying

00:42:57,947 --> 00:42:59,915

00:43:35,552 --> 00:43:38,221

00:45:49,088 --> 00:45:51,622

at the press conference.

00:51:32,704 --> 00:51:34,738

you will be among

00:53:32,490 --> 00:53:35,759

are all over us.

00:56:19,570 --> 00:56:21,771

what I'm gonna tell them.

one was dumb enough to take on

too much money".

3 and 1/2 hours...</i>

01:01:31,760 --> 01:01:35,196

01:03:44,195 --> 01:03:45,929

If the other banks

01:05:21,663 --> 01:05:24,214

You didn't buy Bear.

01:08:58,596 --> 01:09:02,816

01:11:43,745 --> 01:11:46,245

you didn't see this coming?