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JOHN MACK: INSIDE THE BUNKER

17 November 2009 by Cullen Roche 10 Comments

A great inside look at what John Mack and Morgan Stanley was dealing with last year at this time:

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Comments
  • James

    wow that was a good video. I wish he went through how the firm survived.

  • James

    Yeah but he just stopped at talking to the Japanese

  • I wish one of these top bankers from NY would come out with an op-ed or interview segment wherein they warn their audience or the American people about Henry Paulson’s conflict of interest: “Beware the Four Legged Man”

    It would be even better if is was someone like Henry Kissinger presenting the main discussion and getting interaction from these large N.Y. Bankers:

    The following is intended to be read as with the monotone voice of Henry Kissinger; complete with care-ful-ly pro-nounc-ed syl-la-bles:

    “Beward The Four Legged Man with No Conflict of Interest” By Henry Kissinger …Beware the Four Legged Man: Henry Meritt Paulson had two legs in work product walking about Goldman Sachs for several years, both legs fully extending and firmly grounded, bundling and brokering mortgage backed securities. Fast forward from then and 2008 work product: Two legs walking about the Secretary of Treasury for the United States, brokering the same mortgage backed securities (?)

    Henry Paulson: peddling and re-peddling the same instruments (?) selling them previously to Goldman Sachs clients, and in 2008 to a different client, the American people. Using the prestige of Goldman Sachs to abuse trust and good will in both instances.

    Conflicted from his head – over to his other head – and down to the toes under both heads.

    Beware the four legged man.

    How many times can a custodian of funds, broker the same assets and NOT be conflicted? …To answer this important question, we turn to John Mack of Morgan Stanley. *camera turns to John Mack who has a panicked look on his face, dumbstruck, he does not know what to say, there is an awkward silence and then Kissinger continues his monotone narrative (sort of like a subdued round-table, like a McLaughlin Group session, with N.Y bankers as the guests and Henry Kissinger introducing the topics and directing questions to the guests with a lowered brow and subdued tone)*

    “Jamie Dimon, let me ask you: Would you write an op-ed on that? How many times can a custodian of funds, broker the same assets, for different clients and NOT be conflicted?

    How many White House Counsel waved his “potential” conflict of interest, who did not waive John Snow’s? Maybe you’ll tell us their names, in your next op-ed for the Washington Post?”

    *Jamie Dimon is silent, unsure if its a joke, sits there with a grin — Kissinger continues*

    Has the corruption of the Treasury office been good for you, New Yorkers … Lloyd Blankfein?

    *camera turns to Lloyd who is moved to make eye gestures, after a long pause Lloyd is compelled to make a hand gesture like in a silent movie he has seen of the Three Stooges – one of the same gestures he was using in 8th grade when talking to girls. Kissinger continues his monotone and sober delivery*

    Robert P. Kelly, Chairman of the Board and Chief Executive Officer at Bank of New York Mellon. You have been silent for the last 14-18 months when capitalism and capitalist rule of law needed a defender from New York’s Banking community. You may or may not represent the senior statesman of this group. All that conflicted orientation emitting from Mr. Paulson’s work product and moving about. 5- 6 years brokering the same investment instruments, but working for different corporate entities. Selling the bundles to Goldman’s clients, driving companies to financial terror and competing firms to bankruptcy or ruin, then moving from the private sector and into the public sector. Re-acquiring the same bundles as Treasury of the United States government, and then, re-peddling the same bundles to the American public…. Where do you stand on that Robert?

    *Robert Kelly has that look you see on a child’s face when they are wetting their pants. After a brief pause, manages to speak …* “You will have to ask the Bank President Gerald Hassell. I am the CEO. He was President when all that was happening, I was too far up above much of what was happening to be close enough or paying attention. … Er, I mean, I was too busy. Are we live? Is this tapped?” *he looses his composure for a brief moment and horror comes over his face* “Can we edit that out?”

    *Kissinger continues and addresses the camera*

    How many times can a custodian of funds, broker the same assets and NOT be conflicted, America? *Turns to camera two.* Perhaps Americans can ask the current President and his Treasury appointment and hope for a straight answer to that important question.

    How many White House Counsel waved Mr. Paulson’s “potential” conflict of interest, who did not waive John Snow’s? A little aside for my viewers, I will tell you the truth: John Snow’s “potential” conflict, cost the nation about 7.8 Trillion dollars less than Henry Paulson’s “actual” conflict of interest.

    I turn to Lloyd Blankfein with these final questions and bid my viewers a good and cautious week ahead. *Turns to Lloyd, who clinches the arm rests in such way as causes his shoulders to ride up*

    How many times did he broker the same assets – which he would later call “toxic” Lloyd? Did he call them toxic when he was selling them to Goldman’s clients or just the American people?

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    • John Mack is try to duck out of the fracas, without making full disclosure of how bad our current leadership is. His resignation and cautious backing out, is a testament to a man who is disturbed, about the conflict of others, lying to Congress he has seen, potential Treason, and financial abuse he has witnessed first hand. Things not disclosed in his “inside the bunker” feature: He has never seen as much blatant lying to Congress; from a Treasury officer, or what he recognizes as a broker turned Treasury. It has moved him to leave the business. He says he respects the 3, but this is a statement of someone who is given to pleasantries and still being a CEO, does not want to incur their wrath – because they are picking favorites at that point and I think Mack probably understood that was a top heavy situation. His unwillingness to challenge it, speaks to what Ken Lewis was looking at. A sense of favoritism (peer pressure to falsely call it “patriotism”) mixed with a cloud of confusion in observing Mr. Paulson’s unchallenged/unacknowledged conflict of interest.

      http://www.nytimes.com/2009/08/09/business/09paulson.html?pagewanted=all

  • Imo, John Mack is the lesser threat of N.Y. banking association firms, but in another metro region, they would view him as just as big a systemic risk (if for no other reason than that he goes along in silence, seeming more worn for his troubles, but quietly counting his money and trying to get out while trying to make overture of something, still a lot of uncertainty in that head of his, afraid to call it outright treason or wretched on its face). Maybe it is his way of calling a bad faith work product, bad for the country, but from my perspective, he is try to duck out of the fracas, without making full disclosure of how bad our current leadership is. Sensing they have worked themselves into a hole and does not want to be the one to rat them out.

    His resignation and cautious backing out, is a evidence of a man who is disturbed, about the conflict of others, the lying to Congress he has seen, potential Treason, and financial abuse he has witnessed first hand. He knows that New York’s banking industry, has ruined a lot of trust and good will for other banking communities (who did nothing wrong) and he does not know how to fix it, in light of the current path the White House lead by the second Treasure who is still being mentored by N.York bankers (off record told what to do). He does not trust their leadership and what they are doing to deceive the country. (For example, morphing the Treasury into an options writer or a derivative of an options writing entity. Most Americans do not understand the options writing market, and therefore, should not be liable nor be required to guarantee options writing originated by an appointed officer. This is going down the wrong course and will probably be expanded if Treasury Geithner and Jamie Dimon have their way. John Mack sees this, and silently he does not agree with it, but he is not stable enough as a person to come right out and call it a black operation.

    Other things not disclosed in his “inside the bunker” feature: He has never seen as much blatant lying to Congress; from a Treasury officer, or what he recognizes as a broker turned Treasury. It has moved him to leave the business. He does not want to appear as one abandoning ship and he is not doing that. But its not the same business he came to when a he first joined the industry. And its not the same business it was 2 years ago, going back 25-30 years.

    He says he respects the 3, but this is a statement of someone who is given to pleasantries and still being a CEO, does not want to incur their wrath – because they are picking favorites at that point and I think Mack probably understood that was a top heavy situation. His unwillingness to challenge it, speaks to what Ken Lewis was looking at: A sense of favoritism (peer pressure to falsely call it “patriotism”) mixed with a cloud of confusion in observing Mr. Paulson’s unchallenged/unacknowledged overtly grotesque, conflict of interest.

    http://www.nytimes.com/2009/08/09/business/09paulson.html?pagewanted=all

  • I wish this site had a edit feature, I am often posted double posts and do not mean to spam. Sorry about that TPC.

    • Cullen Roche TPC

      Bruer, your comments keep getting caught in the spam filter. Perhaps you’re entering an odd email address or something?

      • Its been a long day. I probably am using a wrong email… lol… My email would actually route it to a spam filter? or wrong email?

        And here all this time, I thought an edit (a post) feature would be really cool.:)

        Great site TPC. I am often amazed how you come up with so many good a juicy titles and subjects.

        • Cullen Roche TPC

          Thanks for the compliments Bruer. I believe I resolved the problem with your comments getting sent to the spam filter.

          As for an edit feature – I tried that. It didn’t play nice with the site code….