Chasing Goldman Sachs

  1. Every successful innovation carries within it the seeds of its own potential destruction, and Drexel's junk bond empire would be no exception.
    By the time Gelband began to warn his colleagues at Lehman Brothers about the impending storm, it was already on its way. At first, it looked like nothing more than a single, distant cloud marring an otherwise perfect sky, or a small snowball rolling down an Alpine slope. But as the months passed throughout 2006 and early 2007, the number of clouds grew in number and became darker and more ominous; the snowball became a giant boulder and, moving faster and faster, threatened to trigger an avalanche that would crush everything in its path. At the time, few seemed to realize just what was brewing, yet the signs were everywhere.
  2. Wall Street loathes a party pooper - the guy who arrives on the scene and shakes his head in solemn disapproval of the antics while everyone else is having fun.
    Think of the old legend of the turtle and the scorpion. The scorpion, who needs to get across the river but can't swim, asks the turtle to carry him. The turtle initially scoffs at the idea. "Are you mad?" he demands. "You'll sting me while I'm swimming and I'll drown." The scorpion points out that if he did, he'd drown too. "Where is the logic in that?" he inquires. The turtle, convinced, tells the scorpion to hop aboard, and starts swimming. Halfway across, the scorpion stings the turtle. As they sink to the bottom of the river, the turtle turns resignedly to the scorpion and asks, "Why did you do it? You said there'd be no logic in you stinging me." "It has nothing to do with logic," the scorpion answers sadly. "It's just my character."
  3. Wall Street may have been dancing as long as the music kept playing, in Chuck Prince's words. But to many it seemed as if the central bankers and securities regulators were calling the tunes and turning up the volume.
    The financial system, they concluded, had become "a highway where there were neither speed limits nor nearly painted lines" and on which Wall Street firms had been conducting a giant game of chicken in the high-speed Porsches purchased with their lavish bonuses.
Card Set
Chasing Goldman Sachs
from the book