Chapter 1: A Family Business
1. “he quickly set off”: Stephen Birmingham, Our Crowd: The Great Jewish Families of New York City (New York: Harper & Row, 1967).
2. “had supported herself quite nicely”: Ibid.
3. Account of the transaction between Frederick Douglas, “A. Cramer,” and “Carl Wolff” is from NYT, March 19, 1886.
4. Account of the loan to N. J. Schloss & Co. is from NYT, December 6, 1893, and December 9, 1893.
5. “well nigh penniless”: NYT, December 21, 1891.
6. “always charitable to a degree”: Ibid.
7. “From the very first moment”: Lisa Endlich, Goldman Sachs: The Culture of Success (New York: Touchstone, 2000), p. 35.
8. “My boy, you come home and go to work”: WSOH, 1956, p. 22.
9. “It was more or less blazing a trail”: WSOH, 1964, p. 218.
10. “That Sears business”: Ibid., pp. 33–34.
11. “Frank Woolworth”: Ibid., pp. 96–97.
12. “commercial banking all over the world”: Transcript of the January 6, 1914, public hearing in New York City regarding the establishment of the New York Federal Reserve Bank.
13. “The word ‘aid’ ”: Ibid.
14. “The reserve power”: Ibid.
15. “Well, I guess I am out of step”: Ibid., p. 39.
16. “I am not in sympathy”: Endlich, pp. 42–43.
17. “to give his services”: WSOH, 1956.
18. “two or three investments”: Ibid.
19. “Being a Jew”: Ibid., p. 40.
20. “Henry Goldman was an extraordinary personality”: Ibid., p. 41.
21. “suave and polished Southerner”: WSOH, 1956.
Chapter 2: The Apostle of Prosperity
1. “tall, slender, unassuming”: NYT, January 1, 1968.
2. “lack of adequate banking facilities”: NYT, February 13, 1910.
3. “For the next three years”: Time, September 14, 1925.
4. “had casually explained”: NYT, January 1, 1968.
5. “If business is to continue zooming”: Ibid.
6. “business cycle was dead”: Lisa Endlich, Goldman Sachs: The Culture of Success (New York: Touchstone, 2000), p. 44.
7. “Catchings was a brilliant person”: WSOH, 1956, p. 43.
8. “such great companies”: Ibid, p. 44.
9. “In those days”: Ibid.
10. “Our business had grown so”: Ibid., p. 45.
11. “there weren’t enough”: John Kenneth Galbraith, The Great Crash, 1929 (New York: Mariner Books, 2009, paperback reprint edition), p. 43.
12. “Historians have told with wonder”: Ibid., p. 49.
13. “The stock is said to have sold”: Ibid.
14. “As a promotion”: Ibid.
15. “And the management of the trusts”: Ibid., p. 47.
16. “only when the tide goes out”: Warren Buffett, “Chairman’s Letter,” Berkshire Hathaway 2001 Annual Report.
17. “[R]arely, if ever, in history”: Galbraith, p. 60.
18. “This remarkable premium”: Galbraith, p. 61.
19. “sufficient to constitute working control”: Trust, p. 589.
20. “on the ground that it preferred”: Ibid.
21. Information from the GSTC prospectus: Ibid., p. 590.
22. “give the clients and customers”: Ibid., p. 591.
23. “other banking houses”: Ibid.
24. “Throughout the whole period”: Ibid.
25. “build them up”: Ibid., p. 592.
26. “might possibly at times”: Ibid.
27. “was not even remotely”: Ibid.
28. “[A]fter discussing the matter”: Ibid., p. 596.
29. “Two of my associates”: Ibid., p. 597.
30. “done a great deal of business”: Ibid., p. 599.
31. “prestige and standing”: Ibid., p. 600.
32. “in connection with the proposed acquisition”: Ibid., p. 610.
33. “a tremendous hullabaloo”: Ibid., p. 611.
34. “[I]t is apparent that”: Ibid., p. 623.
35. “I never regarded that we had”: Ibid., p. 625.
36. “The market value for its own stock”: Ibid., pp. 626–27.
37. “buying actually improves the market”: Ibid., p. 613.
38. “I tell you with great positiveness”: Ibid., p. 614.
39. “The spring and early summer”: Galbraith, p. 61.
40. “had gone outside its legitimate”: NYT, April 4, 1929.
41. “Goldman Sachs by now”: Galbraith, p. 62.
42. Goldman Sachs Trading Corporation was worth: NYT, August 20, 1929, p. 84.
43. “[T]he nearly simultaneous”: Galbraith, p. 64.
44. “Well, this is just absolutely crazy”: WSOH, 1956, p. 49.
45. “The trouble with you, Walter”: Ibid.
46. “I remember that day very intimately”: Studs Terkel, Hard Times: An Oral History of the Great Depression (New York: New Press, 2000), pp. 72–74.
47. “secure a divorce”: NYT, February 28, 1930.
48. “beginning, in 1930, to show”: WSOH, 1956, p. 46.
49. “Weinberg and I talked together”: Ibid., p. 46. Sachs described the entire incident in his oral history.
50. “In those days”: Ibid., p. 47.
51. “[We] could hold up our heads”: Ibid., p. 48.
52. “the loudest prophet of the New Era”: Time, August 21, 1933.
53. “Well, that was very nice”: WSOH, 1956, p. 49.
54. “There were all kinds of stockholders’ suits”: Ibid., p. 50.
55. the last one of which did not get settled: NY, November 10, 2008.
56. “The margin clerk for Goldman Sachs”: Among other sources, NYT, July 29, 1969.
Chapter 3: The Politician
1. “great rehabilitation”: WSOH, 1956, p. 51.
2. “Don’t imagine for a moment”: Ibid., p. 53.
3. “In the ’29 crash the name Goldman”: “Let’s Ask Sidney Weinberg,” Fortune, October 1953, p. 174.
4. “We faced the music”: WSOH, 1956, p. 81.
5. “His mind began to fail with age”: Ibid., p. 52.
6. “I was perfectly frank”: Ibid., p. 82.
7. “that people began”: Ibid., p. 53.
8. “kewpie doll”: E. J. Kahn Jr., “Director’s Director,” NY, September 8, 1956, p. 39.
9. “hustled his way”: NYT, July 29, 1969.
10. “half a pint of whisky”: Time, December 8, 1958.
11. “finding this no strain”: NY, September 15, 1956, p. 62.
12. “Then he lost”: Ibid.
13. “To whom it may concern”: NYT, July 29, 1969.
14. “for accuracy”: Fortune, October 1953.
15. “In Sing Sing”: NY, September 15, 1956, p. 60.
16. “Sometimes you don’t know”: Fortune, October 1953.
17. “feather horse”: Ibid.
18. “What’s a panic?”: NYT, December 16, 1967.
19. “had given his heart”: Ibid.
20. “Do you need a boy?”: NYT, February 8, 1942.
21. “Weinberg remained”: NY, September 15, 1956, p. 65.
22. “Ever try to carry”: NYT, December 16, 1967.
23. “One course they offered”: Ibid.
24. “Paul Sachs was the first partner”: NY, September 15, 1956, p. 65.
25. “knowing everybody”: NYT, December 16, 1967. This article also describes his World War I service.
26. “He has since become”: NY, September 15, 1956, p. 66.
27. “Unless you can make one”: NYT, December 16, 1967.
28. “It was my own money”: Ibid.
29. “I just wasn’t very bright”: Fortune, October 1953.
30. “I guess you must have run”: NY, September 15, 1956, p. 69.
31. “I’m an investment banker”: NYT, December 16, 1967.
32. Account of Weinberg in Akron, Ohio, is from NY, September 8, 1956, p
. 42.
33. “clubhouse Democrat”: Fortune, October 1953.
34. “The Street was against Roosevelt”: Studs Terkel, Hard Times: An Oral History of the Great Depression (New York: New Press, 2000), pp. 72–74.
35. “I cannot tell you”: Letter from Sidney Weinberg to Franklin Roosevelt, November 9, 1932.
36. “you might wish to have”: Letter from Sidney Weinberg to Franklin Roosevelt, January 18, 1933.
37. “He was pleased to have this”: Letter from Louis Howe to Sidney Weinberg, February 23, 1933.
38. “intimate friend”: Letter from Sidney Weinberg to Louis Howe, December 6, 1932.
39. Paul M. Clikeman’s account of what happened at McKesson & Robbins is found in “The Greatest Frauds of the (Last) Century,” a monograph in the May 2003 issue of New Accountant USA.
40. “I’m for McKesson”: NY, September 8, 1956, p. 48.
41. “Well, come on, gentlemen”: Fortune, October 1953.
42. “gave Sidney some uncomfortable moments”: Ibid.
43. “pointed out to him”: NY, September 8, 1956, p. 48.
44. “My partner”: WSOH, 1956, p. 122.
45. “Sidney Weinberg has this alchemy”: Fortune, October 1953.
46. “gourmand’s appetite”: NY, September 15, 1956, p. 49.
47. “an ambassador”: BusinessWeek, January 27, 1951.
48. “many grimly intransigent”: NY, September 15, 1956, p. 49.
49. “entirely personal”: Letter from Sidney Weinberg to Stephen Early, July 5, 1938.
50. “I don’t speak Russian”: NYT, November 16, 1967.
51. “business and financial monopoly”: WSJ, February 1, 2010, Amity Shlaes.
52. “FDR saved the system”: Terkel, pp. 72–74.
53. “unsound”: NY, September 15, 1956, p. 49.
54. “I did not support him”: Terkel, p. 73.
55. “for a great many years”: WSOH, 1956, p. 12.
56. “a man of great charm”: Ibid.
57. “in which he thanked me”: WSOH, 1964, p. 154.
58. “I remember telling people”: WSOH, 1956, p. 14.
59. “Not that I didn’t realize”: Ibid., p. 15.
60. “maybe it was partly”: Ibid.
61. campaign buttons: Letter from Sidney Weinberg to Franklin Roosevelt, January 30, 1942.
62. “Every time I went”: NY, September 15, 1956, p. 52.
63. “resented”: Ibid., p. 54.
64. “stabbing his old friend”: Fortune, October 1953.
65. “I have just learned”: Letter from Franklin Roosevelt to Sidney Weinberg, August 31, 1944.
66. “There was less and less”: Charles D. Ellis, The Partnership: The Making of Goldman Sachs (New York: Penguin Press, 2008), p. 45.
67. “Jock, if they cut us down”: NY, September 15, 1956, p. 49.
68. “I didn’t have any clear idea”: Ibid., p. 50.
Chapter 4: The Value of Friendship
1. “was the greatest outfit”: NY, September 8, 1956, p. 40.
2. “His lips characteristically pursed”: Ibid., p. 39.
3. “Sidney had done his homework”: Time, December 8, 1958.
4. “That, as Bobby Lehman”: WSOH, 1956, p. 56.
5. “flat on his back”: Fortune, October 1953.
6. “Sidney is a wizard”: NY, September 8, 1956, p. 47.
7. “The Jew is the world’s enigma”: Henry Ford, “The International Jew: The World’s Foremost Problem,” originally published in Dearborn Independent, May 1920.
8. “The big problem”: NY, September 8, 1956, p. 64.
9. he created an alphabet soup of names: Ibid., p. 66.
10. “How could you keep anything confidential”: Charles Ellis, The Partnership (New York: Penguin Press, 2008), p. 58.
11. “John, John”: Ibid.
12. “Without you”: Ibid., p. 60.
13. “financial Alexander the Great”: NYT, September 10, 1958.
14. “ultra-modern”: NYT, April 1, 1957.
15. The involvement of Goldman Sachs in the antitrust suit is from the Corrected Opinion of Harold R. Medina, United States Circuit Judge, civil action no. 43–757, filed February 4, 1954.
16. “ ‘the cream of the business’ ”: Medina opinion, p. 8.
17. “The best description”: WSOH, 1956.
18. “the older firms”: Medina opinion, p. 170.
19. Medina’s chart: Ibid., p. 171.
20. The material on Goldman and Pillsbury is from ibid., pp. 329–46.
21. The material on Goldman and Lehman Brothers is from ibid., pp. 312–16.
22. “in a rather conceited way”: WSOH, 1956, p 92.
23. “My own position”: Ibid., p. 90.
24. The information on trial costs is from NYT, September 23, 1953.
25. “absolutely firm”: Ibid. p. 91.
26. “highly intelligent”: Ibid.
27. “I think there’s a realization”: WSOH, 1956, p. 103.
28. “You have to maintain”: Ibid., p. 104.
29. “turned away from”: Ibid., p. 105.
30. “It’s a wonderful field for young men”: Ibid., p. 106.
31. “the next ten years”: Ibid.
32. “reason for 1929”: Ibid., p. 109.
33. “If you have a lawyer”: Ibid., p. 95.
Chapter 5: “What Is Inside Information?”
1. “new brilliant genius”: WSOH, 1956, p. 68.
2. “His father was a middle-class doctor”: Author interview with L. Jay Tenenbaum.
3. “She wanted to show”: Ibid.
4. “He was unsupervised”: Judith Ramsey Ehrlich and Barry J. Rehfeld, The New Crowd: The Changing of the Jewish Guard on Wall Street (Boston: Little, Brown & Co., 1989), p. 30.
5. “His mother was a real flake”: Author interview with Betty Levy Hess.
6. “I had two dollars in my pocket”: Author interview with L. Jay Tenenbaum.
7. “It was the thing to do”: NYT, June 4, 1961.
8. “I didn’t have any money to lose”: Ibid.
9. “With a friend’s help”: Ibid.
10. “Arbitrage as a form of trading”: Ehrlich and Rehfeld, p. 31.
11. “The classic example”: Celler Commission Report, Conglomerate Merger Investigations, 1969.
12. “Despite a distinctive lisp”: Charles D. Ellis, The Partnership (New York: Penguin Press, 2008), p. 74.
13. “and the opportunities”: NYT, June 4, 1961.
14. “had collected a group”: Roy C. Smith, Paper Fortunes: Modern Wall Street; Where It’s Been and Where It’s Going (New York: St. Martin’s Press, 2010), p. 86.
15. “None of it was from trading”: NYT, November 16, 1967.
16. “The war came”: Author interview with Salim B. “Sandy” Lewis.
17. “I didn’t have enough experience”: NYT, June 4, 1961.
18. “built one of the most active”: WSOH, 1956.
19. “Gus was very smart”: Ellis, p. 75.
20. “were seeking the assistance”: NYT, June 4, 1961.
21. “We’ve got a policy”: Levy interview with Gilbert Kaplan, Institutional Investor, November 1973.
22. “a heap of du——”: NYT, May 3, 1973.
23. “The Murchison-Kirby relationship”: NYT, May 24, 1961.
24. Information on the Young suicide: NYT, January 26, 1958.
25. “quiet, powerful role”: NYT, June 4, 1961.
26. “Pride. Family pride”: NYT, July 5, 1963.
27. “I offered the job”: Author interview with L. Jay Tenenbaum.
28. Biographical details are from ibid.
29. “I was in combat”: Ibid.
30. “But don’t forget”: Institutional Investor, November 1973.
31. “He was smart, quick”: Smith, p. 86.
32. “My mother never got”: Author interview with Peter Levy.
33. “Hey you, you”: Author interview with Sandy Lewis.
34. “33-ma
n group”: NYT, May 25, 1965.
35. “To be perfectly honest”: Ibid.
36. “Gus was very proud”: Ellis, p. 91.
37. “As long as I am a governor”: Institutional Investor, November 1973.
38. “I say my prayers”: Ibid.
39. “[T]hey were kept short”: Ellis, p. 80.
40. “Gus was always”: Ibid., p. 78.
41. “I can’t say”: Author interview with Betty Levy.
42. “Well, we do demand”: Institutional Investor, November 1973.
43. “The thing about Goldman Sachs”: Author interview with L. Jay Tenenbaum.
44. “If you found out”: Ibid.
45. “I don’t know how I found them”: Ibid.
46. “If there were tax cases”: Ibid.
47. “That’s shooting fish in a barrel”: Ibid.
48. “The question is what is inside information”: Ibid.
49. “Gus brought him in”: Ibid.
50. “L. Jay, I know you’re working with Dowler”: Ibid.
51. “Gus suddenly becomes furious”: E-mail from Robert Lenzner to the author.
52. “Which was really good money”: Author interview with Bruce Mayers.
53. The description of Mayers’s experience in Goldman’s arbitrage department: Author interview with Bruce Mayers.
Chapter 6: The Biggest Man on the Block
1. “There’s only one problem”: Author interview with L. Jay Tenenbaum.
2. “I was an odd choice”: Robert E. Rubin, In an Uncertain World: Tough Choices from Wall Street to Washington (New York: Random House, 2003), p. 37.
3. “As a young Jew”: Ibid., p. 45.
4. “He quickly made a good deal of money”: Ibid., p. 46.
5. “a lawyer, an investor”: Ibid.
6. “You’d like to dance”: Ibid., p. 48.
7. “The people in the town”: Ibid., p. 49.
8. “Robbie Rubin”: Ibid., p. 50.
9. “My grades were good”: Ibid., p. 52.
10. “I looked around”: Ibid., p. 53.
11. “seemed a potentially fruitful area”: Ibid., p. 55.
12. “with no job”: Ibid.
13. “I imagine you track”: Ibid., p. 57.
14. “dropping out anyway”: Ibid.
15. “perhaps the dean”: Ibid.
16. “The trouble with boys”: Ibid., p. 58.
17. “I spent most of my time”: Ibid., p. 59.
18. “I didn’t necessarily want”: Ibid., p. 61.
19. “a sense of curiosity”: Ibid., p. 64.
20. “it had a more comfortable environment”: Ibid.
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