All The Devils Are Here: Unmasking the Men Who Bankrupted the World (73 page)
Read All The Devils Are Here: Unmasking the Men Who Bankrupted the World Online
Authors: Joe Nocera,Bethany McLean
We owe a huge debt to our good friend and agent Liz Darhansoff, who (once again!) talked us off the ledge more times than we can count. Ditto to our good friend and editor Adrian Zackheim, who, at several key points along the way, deftly pointed us in the right direction when we were getting lost in the thicket. At Portfolio we would also like to thank Will Weisser, Allison McLean, Jeff Miller, Alex Gigante, and especially Emily Angell and Courtney Young, who went above and beyond in getting us from sprawling manuscript to published book. In the early stages of our research, we were aided by our old friend Maggie Boitano. In the latter stages, we were ably assisted by two newer friends, Dan Slater and Zachery Kouwe, who chased down people, facts, and documents, often at the last minute.
Since there are two of us, we have two separate groups of friends and colleagues who helped us get through life as we were getting through this book. We would like to thank them now. Bethany first:
I’d like to thank
Vanity Fair
—in particular, Graydon Carter and Doug Stumpf—who have given me the freedom to explore the financial crisis and to take the time to write this book. I’d also like to thank
Fortune
, my longtime home, for teaching me the ropes of business journalism and allowing me to take months to write in-depth stories about, among other subjects, Fannie Mae. In addition, a special thanks to Ken Scigulinsky and Joe Ferrara, who served as unpaid research assistants and sources of ideas, debate, and inspiration.
On a personal note, I wouldn’t have survived the process of reporting and writing this book without the love and support—and great sense of humor—of my wonderful husband, Sean Berkowitz. I also owe a big thanks to my circle of extended family and friends who have put up with my general grumpiness and lack of time during this project. In particular, my love and gratitude go to my mother-in-law, Naomi Berkowitz, who has made sure that Laine was fed, clothed, and diapered while I panicked at my computer, and to Lyle and Dana Berkowitz. Thanks also to Bob and Karen Ranquist, the team at Ranquist Development, and Jennifer Lissner for friendship, professionalism well beyond the ordinary, and a marvelous place to live and work. I’d also like to thank Karen Muirhead, Indira Jusic Zisko, and Sara Rodriguez for the loving care they’ve provided my daughter, and the peace of mind they’ve provided me. Of course, a thank-you to Laine for being as accommodating as an infant can be. My parents, Robert and Helaine McLean, and my sister, Claire McLean, have always helped me keep book writing in perspective. I would be lost without Steve Baerson’s encyclopedic knowledge of history and extraordinary bookkeeping skills. And a final thank-you to my beloved Beast, who has now weathered two books and the corresponding loss of Frisbee time with as much grace as a bulldog can muster.
Joe’s thank-you’s:
The
New York Times
has been a wonderful home for me these last five years. Winnie O’Kelley took me aside not long before the crisis erupted in 2008 and told me in no uncertain terms that I would be well served to start focusing my column on the mounting problems on Wall Street. That was great advice, to say the least. Larry Ingrassia, my boss in the business section, involved me in several big projects in the immediate aftermath of the crisis that whetted my appetite for writing this book. He, along with executive editor Bill Keller and Gerry Marzorati, who until recently edited the
New York Times Magazine
, were extremely generous in granting me the extended leave that allowed me to write this book. Gerry also assigned me a story on risk management for the magazine; that story became the basis for
Chapter 4
. Vera Titunik edited that story beautifully, as she always does. My colleagues Louise Story and Eric Dash helped me in numerous ways. Andrew Ross Sorkin was especially generous with insight and advice, especially once he’d finished
his
book about the financial crisis,
Too Big to Fail
.
Books consume writers; inevitably, that obsession winds up roping in their friends and families. Among the friends I’d like to thank are Steve Klein, Ken Auletta and Amanda Urban, Sam Waksal and Andrea Rabney, Bill Burd and Jane Noble, Charlie Borgognoni, Adam Bryant, Tim and Jennifer Smith, Paul and Jennifer Argenti, Greg Frank and Lauren Foster, Jimmy Smyth, Meg Rhodus, Roger and Claudine Parloff, Dan and Becky Okrent, and David and Lyn Grogan.
My three older children, Kate, Amato, and Nick, watched with bemusement and a touch of pride as I worked to complete the book; they’ve seen this act before. My future mother-in-law, Louise Schneider, arrived in the nick of time, just as Bethany and I were racing to the finish line, and offered a great deal of help and comfort.
As I was beginning to write this book, I acquired a puppy, a German shepherd named Lanka. I was always surprised and happy at the way he could lift my spirits, offering stretches of simple pleasure. About a month before this book was finished, a new member of the family arrived: Macklin Joseph. Baby Mack is a wonder, and a source of immense joy. I can’t wait to dedicate my next book to him.
As for this book, it is dedicated to Dawn, the love of my life, who saw me through this project, as she has seen me through every part of our life together these past years. She makes it all worthwhile.
Aames,
34
Abbamonto, Paul,
36–37
ACA Management,
280
ACORN,
132
Adjustable-rate mortgages
defaults,
257
operation of,
29
Advani, Deepali,
307
AIG Financial Products (AIG FP),
71–81
BISTRO,
80–81
bonuses (2009),
360
collapse of,
336–41
collateral triggers,
190–91
Edper losses,
76
under Savage,
77–80
ESC investigation of,
196
under Sosin,
77–80
swaps, developing,
73–74
Alberto, Patricia,
93
Alternative Mortgage Transaction Parity Act (1982),
29
American Home Mortgage Investment Corporation,
344
American International Group (AIG)
bonuses, post-bailout,
360
CEOs.
See
Greenberg, Maurice R. “Hank”
;
Sullivan, Martin
;
Willumstad, Robert
derivatives division. See
AIG Financial Products
founding of,
69–70
fraudulent activities,
195–99
ratings cut,
199
restatement of earnings,
198–99
stock, decline of,
194–95
subprime portfolio of,
193–94
subsidiaries,
192–93
Ameriquest
collapse of,
207–8
consumer complaints/lawsuits,
204–6
loan fees,
130–31
portfolio retention branches,
131–32
profitability of,
128–31
prohibited in Georgia,
146
See also
Arnall, Roland
Amresco,
30
Anderson, Jenny,
321
Anderson, Josh,
297
Anderson Mezzanine Funding CDO,
276
Andrukonis, David,
184–85
ARCS Commercial Mortgage Company,
22
Armey, Richard,
45
Arnall, Roland
as ambassador to Netherlands,
209–10
biographical information,
27
wealth of,
132
See also
Ameriquest
;
Long Beach Mortgage
Arthur Anderson,
176
Ashley, Stephen,
41
Askin, David,
18
Asset-backed commercial paper (ABCP),
241
Asset-backed securities (ABS),
265
Athan, Tom,
324
Baby boomers, and homeownership,
5
Bailouts.
See
Federal bailouts
Bankers Trust, swap deal lawsuit,
65
Bank of America
subprime branches, closing,
94
Barnes, Roy,
146
Bartiromo, Maria,
303