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Lehman June 1
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Breaking Silence, Richard Fuld Speaks on Love, Putin and ‘Rocky’
May 28, 2015 | The New York Times
By David Gelles
After nearly seven years of public silence, Richard S. Fuld Jr., the former chief executive of Lehman Brothers, had a lot to say. In a rambling speech at the Marcum MicroCap Conference at the Grand Hyatt New York in Midtown Manhattan — his first public appearance since the financial crisis — Mr. Fuld offered an opinion about the Islamic... -
Unrepentant Dick Fuld Blames Washington For Lehman Collapse
May 28, 2015 | Financial Times
By Tom Braithwaite
Former Lehman chief Dick Fuld arrives to speak at the Marcum Microcap conference in New York on Thursday Dick Fuld, who presided over the implosion of Lehman Brothers, used his first voluntary public appearance since 2008 to blame Washington for fuelling the financial crisis and ordering the investment bank’s closure. -
Overheard: Richard Fuld Still Doesn’t Think Lehman Was Really Bankrupt
May 28, 2015 | The Wall Street Journal
Nearly seven years since the collapse of Lehman Brothers, former chief Richard Fuld Jr. is still in the first stage of grief: denial. In a rare public appearance at a conference Thursday, Mr. Fuld reportedly argued that Lehman wasn’t a bankrupt company in September, 2008. He also said it had $28 billion in equity capital and $127 billion in unencumbered ... -
Dick Fuld's Speech: Don't Call It A Comeback
May 29, 2015 | CNBC
By Mark Macias
Former Lehman Brothers CEO Richard Fuld had seven years to improve his image as one of the most reviled and hated men on Wall Street but this week — at least from a public-image perspective — he proved he is the same old Dick who helped lead the 2008 financial crisis. -
Sorry Is The Hardest Word And Not Everybody Wants To Say It
May 30, 2015 | The Times (UK)
By Patrick Hosking
He’s the one senior banker who never came close to saying sorry and it seems that Dick Fuld isn’t going to. In a combative speech this week to a finance conference in Manhattan, the former chairman and chief executive of Lehman Brothers said that he had “no regrets”. -
US Outlook: John Malone Looks Set To Walk All Over The Competition Regulator Again
May 29, 2015 | The Independent (UK)
By Andrew Dewson
...Unlike that other Dick – Cheney – the former Lehman chief executive Dick Fuld has had the decency to remain publicly silent since his fall from grace. Until now. Like the other Dick, it turns out Mr Fuld is convinced that everything is everyone’s fault but his. What is it about people called Dick?This week Mr Fuld made his first speech since the fall... -
Former Lehman Brothers CEO Still Doesn't Get It
May 29, 2015 | Minneapolis StarTribune
By Lee Schafer
Former Lehman Brothers CEO Fuld still doesn’t get it. The last CEO of the late, great Lehman Brothers, Richard Fuld Jr., talked publicly at some length this week for the first time since the 2008 financial crisis. Lehman, of course, was the big New York investment firm that tipped over in mid-September 2008, turning anxiety in the financial markets ... -
Wall Street Has One Question For Dick Fuld
May 31, 2015 | Business Insider
By Linette Lopez
Wall Street has one basic question for Dick Fuld. What do you want? As CEO of Lehman Brothers in 2008, Richard Fuld presided over one of the most stunning failures in modern finance. This week, at his first public appearance in around six years, he said that his firm actually wasn't crumbling all those years ago. -
Dick Fuld’s Comeback Attempt Was a Disaster
May 31, 2015 | Jewish Business News
By Gil Tanenbaum
Dick Fuld seems to be attempting a possible comeback. The last head of the bankrupt financial firm Lehman Brothers made his first public appearance since that firm’s collapse. But if the reports on his speech are true then Fuld may want to re-think returning to the public eye. -
Classic Wall Street Villain to Haters: "Bite Me"
May 29, 2015 | Gawker
By Hamilton Nolan
Dick Fuld was the head of the investment bank Lehman Bros. in 2008 when the bank collapsed in the biggest bankruptcy in history, kicking off the worst part of the financial crisis. Who can say if Dick Fuld ever did anything “wrong?” Not Dick Fuld! In a talk at a conference yesterday... -
Wall St. fraud vs. Main St. fraud
May 30, 2015 | The Charlotte Observer
By Eric Frazier
A justice system pop quiz: Defendant A – A young con artist who cooks up a luxury home-buying scheme that helps him steal more than $75 million from investors and banks over seven years. It prompts one of the largest mortgage fraud investigations in U.S. history. -
Ex-CEO of Lehman Brothers Denies Company Was Broke
May 29, 2015 | News Talk 106-108 FM
By Ruairi Casey
Seven years after the largest bankruptcy in US history, the ex-CEO of Lehman Brothers maintains that the bank was not broke. Reuters reports Richard Fuld Jr told an audience of 1,300 at a micro cap stock conference in Manhattan that "Lehman Brothers in 2008 was not a bankrupt company." -
Former Lehman Brothers Chief Breaks 7-Year Silence, New York Times Reports
May 29, 2015 | The Times-Picayune
By Jennifer Larino
Richard S. Fuld Jr., former CEO of Lehman Brothers, broke a nearly seven-year public silence Thursday (May 28), giving a speech to bankers that touched on everything from the Islamic State to the health of economy, but dwelt very little on his role in the largest bankruptcy in U.S. history, the New York Times reports. -
Is Wall Street Ready for the Volcker Rule?
May 30, 2015 | The Market Mogul
By Fabien Paradis
...The bigger issue of the battle between Dodd-Frank’s supporters and opponents is an uncertainty in regards to the exact operations of investment banks and levels of risk taken, especially when they are economically ‘too big to fail.’ Ex-Lehman Chief Richard S. Fuld Jr. took the brunt of the ramifications of such after Lehman filed for bankruptcy...
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Dick Fuld
Comment - The Volcker Rule
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Breaking Silence, Richard Fuld Speaks on Love, Putin and ‘Rocky’
May 28, 2015 | The New York Times
By David Gelles
After nearly seven years of public silence, Richard S. Fuld Jr., the former chief executive of Lehman Brothers, had a lot to say.
In a rambling speech at the Marcum MicroCap Conference at the Grand Hyatt New York in Midtown Manhattan — his first public appearance since the financial crisis — Mr. Fuld offered an opinion about the Islamic State, fretted about Vladimir Putin and proposed that the economy was not nearly as healthy as the stock markets might suggest.
But while Mr. Fuld, known as “the Gorilla” of Wall Street for his brusque style, was eager to share his views about the world, he assiduously avoided talking about his role in the largest bankruptcy in United States history.
Instead, he offered insights into his views on personal topics, including love and death, and made frequent references to his resilience.
“What did Sigmund Freud say? ‘You can say whatever you want about me. I’m O.K. because I know my mother loves me,’ ” he said to a crowd of 1,300 financial professionals. “And my mother still loves me. She’s 96.”
At another moment, Mr. Fuld offered a boxing analogy: “What did Rocky say? ‘It’s not how hard you hit but whether you get up after you’ve been knocked down.’ I love Rocky.”
Mr. Fuld was vilified during the crisis, becoming the face of Wall Street’s excess and imprudence. However, he was unapologetic on Thursday, suggesting that Lehman could have survived if the Federal Reserve had allowed it to, and deflected blame for the crisis onto policy makers instead of bankers.
He appeared anxious at first, removing his jacket at the podium. “I haven’t done this in a while,” he said. “This is my first public event since ’08. I don’t include my wonderful time with Congress.”
Explaining the origins of the financial crisis, Mr. Fuld avoided any mention of investment banks’ eagerness to issue subprime mortgages. (Lehman had an enormous portfolio of subprime loans.)
“It’s not just one single thing,” Mr. Fuld said. “It’s all these things taken together. I refer to it as the perfect storm.”
At the root of the crisis, in his view, was the government’s push for homeownership. At the same time, hedge funds, private equity firms and sovereign wealth firms grew rapidly, supercharging the global financial system and driving up equity values, balance sheets, the volume of financial products and the need for financing, he said.
“There was very little regulation or market supervision,” Mr. Fuld said.
Then in 2007, the Fed raised interest rates, essentially ending the housing boom it had encouraged, Mr. Fuld said.
“The increased rates led to increased mortgage rates and payments, a huge number of residential foreclosures,” he said. “Banks wrote down and sold assets.”
In the wake of this, companies began cutting costs and jobs, Mr. Fuld said, and it became “a self-fulfilling economic loop.”
“The rest is history,” he added.
Mr. Fuld believes that the current economy is not as healthy as it appears. “Why the hell does it not feel better?” he asked.
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Part of the problem is that small companies cannot obtain financing, he said. While banks have record lending capacity, they are not making it available to companies that need it. Corporations are cutting expenses and jobs but not increasing revenues rapidly, Mr. Fuld added. All of this, he said, was exacerbating income inequality.
“I know you don’t want to hear this from me, but the wealthy are getting wealthier, and again, the belly of America is getting hurt,” he said. “Look, I’m a hard-core capitalist. But let’s be fair — capitalism only works if it starts at the top and filters down. If it doesn’t get down, we’re going to lose.”
Global instability also poses challenges to the United States economy, he said. The rise of the Islamic State, China’s aggressiveness in the South China Sea, Russia’s assertiveness beyond its own borders and Iran’s nuclear ambitions all made Mr. Fuld’s list of worries.
“Taken together, they are fraying the fabric of our system,” he said.
And once again, he pointed the finger at Washington, prompting the crowd to cheer: “Maybe that all gets changed with new leadership. I don’t want to get into that. We need new leadership.”
Despite his best efforts, Mr. Fuld could not help discussing Lehman in passing remarks. He began by admiring the culture of the firm, noting that employees, whom he called “risk managers,” owned more than 30 percent of the $40 billion company.
Mr. Fuld also quickly offered three data points that he suggested made it clear that Lehman could have survived, had the Fed not forced it to fail: “When Lehman was mandated into bankruptcy, we said our equity capital was $28 billion. Second, we had a Tier 1 capital ratio of 11 percent. Third, Lehman had unencumbered collateral of $127 billion.”
“God, there’s so much I’d love to say,” he added. Then, gesturing to a dark drink in his hand, he said, “No, this is not Scotch or rum.”
He then paraphrased the Rat Pack singer Dean Martin: “You know what, I feel sorry for all of you that don’t drink, ’cause when you wake up in the morning, that’s as good as you’re going to feel for the rest of the day. I told my children that for many years.”
At times, Mr. Fuld displayed his trademark bombast. “There’s nothing graceful about me,” he said. “I thought it was time for me to raise my ugly head.”
After his formal remarks, a moderator pressed Mr. Fuld to answer questions about the last days of Lehman...
For full story:
http://www.nytimes.com/2015/05/29/business/dealbook/richard-fuld-breaks-his-silence-since-lehmans-collapse.html
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Unrepentant Dick Fuld Blames Washington For Lehman Collapse
May 28, 2015 | Financial Times
By Tom Braithwaite
Former Lehman chief Dick Fuld arrives to speak at the Marcum Microcap conference in New York on Thursday
Dick Fuld, who presided over the implosion of Lehman Brothers, used his first voluntary public appearance since 2008 to blame Washington for fuelling the financial crisis and ordering the investment bank’s closure.
“Wow, I haven’t done this for a while,” Mr Fuld said. “This is my first public event since 08. I don’t include my wonderful time with Congress,” he added, referring to his post-crisis grillings on Capitol Hill.
Mr Fuld, who was known in his Wall Street heyday as the Gorilla because of his aggressive attitude, chose a relatively low-profile venue for his public comeback — the Marcum Microcap conference in New York where small companies were looking for investors.
But even there, almost seven years since the bank’s collapse, there was still ill-will towards the Lehman boss, particularly from employees — some of whom saw their life savings wiped out in the biggest bankruptcy in US history.
“I have a few words I’d like to say to him,” said Brian Choi, a former Lehman employee who is now vice-president at Woerner Holdings, an investment firm. “You screwed so many.”
Another in the audience remarked: “There should be a Plexiglas shield in front of him.”
Mr Fuld showed no sign of contrition over the demise of the bank, which he led from 1994. The crisis was “a perfect storm,” he said, “but it starts with the government.” It paved the way for unsuitable borrowers to buy homes, caused an interest rate shock, and then unfairly “mandated” the bankruptcy of Lehman while saving competitors.
He acknowledged that all investment banks “had too much leverage” but insisted that Lehman was still solvent when it was placed into bankruptcy, citing the bank’s $28bn of equity capital, a capital ratio of 11 per cent and unencumbered collateral of $127bn.
“Lehman Brothers . . . was not a bankrupt company. I think I missed the violence of the market and how it spread from one asset class to the next. Did we try to do everything we possibly could? Did we fall prey to some other agendas? I’ll leave it at that.
“There’s so much I’d love to say,” he said. “Dah dah dah dah dah . . . enough said on that.” He reached for a glass by the stage and took a sip. “No, this is not scotch or rum.”
In a somewhat disjointed speech, whose pop culture references spanned Dean Martin and Rocky, Mr Fuld pointed to Barack Obama’s administration and said: “We need new leadership.
“Everything’s ‘great’,” he added. “Why the hell does it not feel better? Why has the belly of America been ripped out?”
Mr Fuld said he was a “hardcore capitalist” but added: “Capitalism only works, though, if it starts at the top and filters down. If it doesn’t get down we’re going to lose, really simple.
“Enjoy the ride — no regrets,” he advised the audience. “Look in the mirror, ‘this is about you and me. Are we OK? Let’s enjoy the ride.’ ”
Though Mr Fuld had said he would not speak in detail about Lehman, he answered some questions about the bank’s failure from the conference moderator.
After being told there would be easy questions, at the start of the session, Mr Fuld adopted an exaggerated, deep, movie-announcer voice, replying: “There is no easy one.
“We don’t have time to hear all the things I would have done differently,” Mr Fuld said.
“Do we have time?” the moderator asked the audience. “Yes!” came the resounding reply.
The former Lehman chief said: “It’s very easy to look back. I must tell you that I was blessed with a terrific team, for the most part, a terrific team and we were in it together.”
Asked why he did not retire, Mr Fuld said: “I didn’t think I had a choice. Lehman went down. The next Monday I was working with Alvarez [& Marsal, the bankruptcy consultants working on stabilising the Lehman estate].”
In the aftermath of the collapse, he worked with Bryan Marsal, the bankruptcy consultant who was appointed chief restructuring officer...
For full story:
http://www.ft.com/intl/cms/s/0/a6512800-055d-11e5-8612-00144feabdc0.html#axzz3bn4xdpOH
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Overheard: Richard Fuld Still Doesn’t Think Lehman Was Really Bankrupt
May 28, 2015 | The Wall Street Journal
Nearly seven years since the collapse of Lehman Brothers, former chief Richard Fuld Jr. is still in the first stage of grief: denial.
In a rare public appearance at a conference Thursday, Mr. Fuld reportedly argued that Lehman wasn’t a bankrupt company in September, 2008. He also said it had $28 billion in equity capital and $127 billion in unencumbered collateral. For most, the fact Lehman filed for chapter 11 bankruptcy protection would be conclusive evidence it was, in fact, bankrupt. But Mr. Fuld said the firm was “mandated into bankruptcy,” a phrase he has used in the past. That flies in the face of the 2010 Lehman bankruptcy examiner’s report, which concluded there was sufficient evidence to find Lehman was insolvent by Sept. 8, 2008—and perhaps earlier.
Mr. Fuld also insisted all 27,000 Lehman employees were “risk managers” because each owned equity in the firm...
For full story:
http://www.wsj.com/articles/richard-fuld-still-doesnt-think-lehman-was-really-bankrupt-overheard-1432843690
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Dick Fuld's Speech: Don't Call It A Comeback
May 29, 2015 | CNBC
By Mark Macias
Former Lehman Brothers CEO Richard Fuld had seven years to improve his image as one of the most reviled and hated men on Wall Street but this week — at least from a public-image perspective — he proved he is the same old Dick who helped lead the 2008 financial crisis.
I've consulted some of the most inexperienced and unknown U.S. Senate and congressional candidates, helping them better connect with voters and improve their image with the public. In the future, I will probably use Fuld's speech as an example of what NOT to do when trying to soften your image or reintroduce your brand to the public.
In his speech Thursday at the Marcum MicroCap Conference in New York, Fuld's facial expression revealed anger; his words projected arrogance; his messaging lacked contrition and humility. Here are a few of the major PR mistakes I saw Fuld make throughout his speech, which in the end, only reinforced what we already believed:
Dick Fuld is an angry man. The collapse of Lehman Brothers is nothing to smile about but there are many ways to appear contrite or show humility without appearing gaudy. But Fuld's speech didn't even attempt to show empathy for the 28-thousand plus employees who lost their job and retirement money nearly overnight.
His speech repeatedly referred to Lehman employees as "my people," giving the impression that he owned them. He repeated bragged about the great institute he built at Lehman, but he refused to recognize where that culture failed.
Dick Fuld doesn't look in the mirror. If you listened closely to Fuld's speech, what you repeatedly heard was how great Lehman Brothers was under his leadership and how he developed a culture that was the premiere of Wall Street.
"The real success of the firm, Lehman Brothers, in my view was our culture," Fuld said. A few minutes later, his coronation continued as he called his company as "one of the great investment banking houses on Wall Street."
Here's some PR advice for you, Fuld: If much of America and all of Wall Street remembers you as the CEO who took a company to the grave, don't try to sell yourself as the epitome of success. When the room has an aroma of gas, don't ignore the smell. Instead, acknowledge your failures, express humility and explain what you learned from your time of reflection.
Dick Fuld yearns to be in charge. Remember when you were a kid in school? There was always a boy who was ignored, no matter how hard he tried to entertain the class. Fuld was that little boy in this speech, but unlike his prestigious past, Fuld no longer had the pulpit to berate and yell at his people. But in this speech, he did, and took full advantage of the crowd that ignored him...
For full story:
http://www.cnbc.com/id/102717332
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Sorry Is The Hardest Word And Not Everybody Wants To Say It
May 30, 2015 | The Times (UK)
By Patrick Hosking
He’s the one senior banker who never came close to saying sorry and it seems that Dick Fuld isn’t going to.
In a combative speech this week to a finance conference in Manhattan, the former chairman and chief executive of Lehman Brothers said that he had “no regrets”.
He wasn’t, he said, going to play “woulda, coulda, shoulda” about the collapse of his bank and he blamed government, lax regulators, loan-hungry homeowners and a “perfect storm” of events for the seismic bankruptcy of 2008.
There was no admission, though, of his own role in levering Lehman to precarious levels and...
Subscription needed for full story:
http://www.thetimes.co.uk/tto/business/industries/banking/article4455244.ece
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US Outlook: John Malone Looks Set To Walk All Over The Competition Regulator Again
May 29, 2015 | The Independent (UK)
By Andrew Dewson
Barring a sudden outbreak of good sense, the Federal Communications Commission (FCC) and the Department of Justice will give John Malone’s $55bn (£37bn) bid for Time Warner Cable (TWC) the green light. It will make the 74-year-old cable guru several billion dollars richer, but TWC’s customers might rightly ask what’s in it for them. Not a lot, most likely.
...Blame everyone but me: another Dick is in denial
Unlike that other Dick – Cheney – the former Lehman chief executive Dick Fuld has had the decency to remain publicly silent since his fall from grace. Until now. Like the other Dick, it turns out Mr Fuld is convinced that everything is everyone’s fault but his. What is it about people called Dick?This week Mr Fuld made his first speech since the fall of Lehman at the Marcum MicroCap Conference – a New York get-together for people who invest in small-cap stocks. The speech itself was rather bizarre: clearly out of practice and nervous, Mr Fuld rambled, at times almost incoherently. Seven or eight years to reflect on the demise of Lehman hasn’t left him a remorseful or humbled man. “Lehman Brothers at the point of 2008 was not a bankrupt company,” he said. Deluded, not humbled.
In a way you have to admire the balls of people like Dick Fuld. A guilty party in a Wall Street meltdown and subsequent recession that resulted in millions of lost jobs and homes, and all he could prattle on about was how great a company Lehman was. He even had the chutzpah to mention President Obama, although not by name – “we need new leadership” – taking a leaf out of the other Dick’s playbook. Shameless.
“We had 27,000 risk managers,” he said, the implication being that Lehman couldn’t possibly be at fault when all of its employees had an interest in making sure it did nothing wrong. What nonsense; Lehman had 27,000 employees looking out for number one: max the annual bonus and to hell with everything else. It’s a culture that still prevails and will one day result in another crash. One that again will be everyone else’s fault...
For full story:
http://www.independent.co.uk/news/business/comment/us-outlook-john-malone-looks-set-to-walk-all-overthe-competitionregulator-again-10286078.html
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Former Lehman Brothers CEO Still Doesn't Get It
May 29, 2015 | Minneapolis StarTribune
By Lee Schafer
Former Lehman Brothers CEO Fuld still doesn’t get it.
The last CEO of the late, great Lehman Brothers, Richard Fuld Jr., talked publicly at some length this week for the first time since the 2008 financial crisis.
Lehman, of course, was the big New York investment firm that tipped over in mid-September 2008, turning anxiety in the financial markets into a complete panic. Fuld was vilified, in the press, in Washington and even by his own peers in the New York financial community.
On Thursday, Fuld gave the keynote remarks at a small investor conference in midtown Manhattan. What sticks out is what he said about risk management, as quoted in the Wall Street Journal: “Regardless of what you heard about Lehman’s risk management, we had 27,000 risk managers because they all had a piece of the firm.”
So after seven years to think about it, Fuld still doesn’t get it.
That many people holding a very small piece of a big public company doesn’t mean they are all there to watch for risks. And that kind of structure of the big Wall Street firms, as publicly held corporations, is one of the factors behind the financial crisis. In the old days of Wall Street, the firms were organized as partnerships. The partners put their own capital on the line.
When companies like Lehman Brothers later went public, what went overboard was the partnership structure, and with it went the incentive to watch what the firm was doing because it was literally your own money. Most of Fuld’s compensation in fiscal 2007, the last year before the firm collapsed, was in the form of $35 million in restricted stock units, or RSUs. As long as the stock kept going up, the RSUs would be worth something. Shutting down the underwriting of increasingly risky mortgage securities, exiting lines of business or putting tighter limits on the trading desks were all common sense things that Fuld could have done. But they were not ways to boost the short-term stock price.
So from the top on down, it wasn’t 27,000 people at Lehman managing risk to their personal fortunes, it was 27,000 people gathered together to push for a little more revenue and a little more trading profit. That’s what leads to bonuses and more incentive stock awards. So it’s no real surprise that the leverage ratio, the ratio of debt to equity, peaked at Lehman Brothers at about 60...
For full story:
http://www.startribune.com/former-lehman-brothers-ceo-still-doesn-t-get-it/305516261/
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Wall Street Has One Question For Dick Fuld
May 31, 2015 | Business Insider
By Linette Lopez
Wall Street has one basic question for Dick Fuld.
What do you want?
As CEO of Lehman Brothers in 2008, Richard Fuld presided over one of the most stunning failures in modern finance. This week, at his first public appearance in around six years, he said that his firm actually wasn't crumbling all those years ago.
"I have always said, and now it's being proven, Lehman Brothers in September 2008 was not bankrupt," said Fuld at the Marcum MicroCap Conference in midtown Manhattan on Thursday.
But that's hardly the point anymore. From now on when bankers talk about the harbinger of any unmitigated disaster they'll call it, "a Lehman moment." That's Fuld's legacy now. And perhaps that's why he's back.
During the Q&A, Fuld was asked why he didn't just "ride into the sunset."
Fuld, called 'The Gorilla' during his career for his ferocious disposition, responded jokingly: "Why don't you bite me?"
Then he went on to say, seriously, "I didn't think I had a choice."
Perhaps he didn't. But his peers certainly do.
This is Wall Street, a place where track records have been tarnished for far less than losing a more than a century old firm in the face of doom. Comebacks take time. Even junk-bond king turned convicted-criminal Michael Milken had to wait a while before he reentered public life — and his transgressions made people rich.
Fuld, alternatively, did not.
"A lot of people who worked at Lehman lost their life savings," one ex-Lehmanite told Business Insider's Jonathan Marino at Fuld's speech.
Others complained that Fuld showed no remorse and that he had a very selective memory when it came to Lehman's risk management and culture.
"I was blessed with a terrific team, for the most part. We were in it together," Fuld said. "It's wonderful for me to talk about the culture ... But then, you have the right to ask me 'then, OK, if it was so great, what happened at the end?'"
And what's been happening since?...
For full story:
http://www.businessinsider.com/its-your-move-dick-fuld-2015-5
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Dick Fuld’s Comeback Attempt Was a Disaster
May 31, 2015 | Jewish Business News
By Gil Tanenbaum
Dick Fuld seems to be attempting a possible comeback. The last head of the bankrupt financial firm Lehman Brothers made his first public appearance since that firm’s collapse. But if the reports on his speech are true then Fuld may want to re-think returning to the public eye.
Mr. Fuld gave what the New York Times described as a rambling speech on a number of topics at the Marcum MicroCap Conference held at the Grand Hyatt New York in Midtown Manhattan last Thursday. This was his first public address since 2008. He was supposed to speak on the topic of “How Emerging Growth Companies Can Succeed in Today’s Capital Markets: Perspectives from My Journey,” but the man who now runs his own firm called Matrix Advisors just talked mostly about himself.
Funny. Aren’t people supposed to have a public meltdown before they end their careers, not after?
You remember Dick Fuld, don’t you? He was the determined to the point of maniacal financial wizard and Wall Street Titan who helped to almost single handedly cause the financial meltdown of 2008 which led to the Great Recession. Fuld refused to see the writing on the wall and was guilty of rearranging deck chairs on the Titanic, as it were, while Lehman sank.
It was the bankruptcy of Lehman Brothers, and the loss of all of the investments and capital that went with it, which was credited with starting the run on all of those sub-prime mortgage backed securities. Former U.S. Secretary of the Treasury Henry Paulson has said that failing to bail out Lehman as he did Bear Sterns was a grave mistake.
And Fuld took much of the blame.
Dismissing all of the criticism leveled against him in the past seven years, Fuld told 1,300 financial experts in attendance, “What did Sigmund Freud say? ‘You can say whatever you want about me. I’m O.K. because I know my mother loves me.’ And my mother still loves me. She’s 96.”
It is interesting that he mentioned Freud as CNBC said that he seemed like someone in need of psychotherapy, calling him an angry arrogant man who showed no contrition and who continued to refer to Lehman in the present tense. “Here’s some PR advice for you, Fuld: If much of America and all of Wall Street remembers you as the CEO who took a company to the grave, don’t try to sell yourself as the epitome of success. When the room has an aroma of gas, don’t ignore the smell...
For full story:
http://jewishbusinessnews.com/2015/05/31/dick-fulds-comeback-attempt-was-a-disaster/
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Classic Wall Street Villain to Haters: "Bite Me"
May 29, 2015 | Gawker
By Hamilton Nolan
Dick Fuld was the head of the investment bank Lehman Bros. in 2008 when the bank collapsed in the biggest bankruptcy in history, kicking off the worst part of the financial crisis. Who can say if Dick Fuld ever did anything “wrong?” Not Dick Fuld!
In a talk at a conference yesterday, Fuld made his first public comments in years, after being vilified as one of the worst culprits of the Wall Street blowup that led to the epic 2008 economic collapse that robbed countless millions around the world of their livelihoods. Sure, it’s true that Fuld oversaw Lehman while it dove headfirst into toxic subprime mortgages and leveraged itself by more than 30 to one in the manner of a degenerate gambling addict on a temporary hot streak. But look—that’s in the past. From Dealbook:
Explaining the origins of the financial crisis, Mr. Fuld avoided any mention of investment banks’ eagerness to issue subprime mortgages. (Lehman had an enormous portfolio of subprime loans.)
“It’s not just one single thing,” Mr. Fuld said. “It’s all these things taken together. I refer to it as the perfect storm.” One might say “borrowing tons of money in order to bet it on toxic mortgages that would soon collapse because they were inherently worthless to begin with” was the “one single thing” that really caused this “perfect storm,” but then again one is not Dick Fuld. As the Wall Street Journal reports, Dick Fuld has “no regrets!”...
For full story:
http://gawker.com/classic-wall-street-villain-to-haters-bite-me-1707657559
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Wall St. fraud vs. Main St. fraud
May 30, 2015 | The Charlotte Observer
By Eric Frazier
A justice system pop quiz:
Defendant A – A young con artist who cooks up a luxury home-buying scheme that helps him steal more than $75 million from investors and banks over seven years. It prompts one of the largest mortgage fraud investigations in U.S. history.
Defendant B – The CEO of what was once the nation’s fourth-largest bank. His aggressive pursuit of subprime mortgage assets helps precipitate the 2008 banking meltdown and the Great Recession. During the crisis, he conveys ownership of a $13.75 million Florida mansion to his wife and the firm manipulates its balance sheet to hide $50 billion worth of risky assets.
Which one is headed to federal prison?
If you guessed the CEO, you must have been asleep the past seven years. You’d have an easier time finding an Obama voter at a Tea Party rally than a banking crisis CEO in prison.
No such fate has befallen Defendant B, better known as Richard Fuld, the former Lehman Brothers chief and a poster boy for Wall Street arrogance.
During the crisis, he was hauled before Congress and compared to a looter for pocketing close to $500 million as his company hurtled toward the biggest bankruptcy in U.S. history.
He resurfaced last week, speaking at a financial conference in New York. The man nicknamed “the gorilla” still didn’t get it.
He blamed Lehman’s demise on the federal government’s push to increase home ownership. He said Lehman could have survived, but was railroaded into bankruptcy by the feds.
Heaven help us – he sounded like a man hoping to make a comeback.
“What did Rocky say?” he asked. “‘It’s not how hard you hit but whether you get up after you’ve been knocked down.’ I love Rocky.”
Which brings us to Defendant A, James Tyson Jr. He’s been knocked down, too. But his comeback must wait for about 30 years. That’s the sentence a federal judge in Charlotte handed him last week in the “Operation Wax House” investigation.
The sprawling eight-year probe into real estate fraud in Charlotte and Waxhaw produced charges against 91 people, including attorneys, mortgage brokers, bank insiders and builders. Tyson was the scheme’s “leader of leaders,” prosecutors said.
Of course, Tyson and Fuld don’t make for an apples-to-apples comparison. Tyson conned individual investors and tricked banks into underwriting fraudulent mortgages. Angry shareholders say Fuld’s firm sold them junk investments. But that’s the market, right? Win some, lose some.
Then again, five days before Lehman filed for bankruptcy, its chief financial officer told shareholders it had $42 billion in available cash. Was that an honest mistake? Or deliberate deception?
Federal prosecutors haven’t answered that question, at least not in court. They never mounted a serious effort at a criminal prosecution of Lehman, a report by the New York Times and the investigative website ProPublica suggests.
The sight of Tyson heading off to prison makes you question yet again if there’s one set of rules for little fish and another for big ones.
It brings to mind Bryan Stevenson, the noted civil rights attorney who recently spoke in Charlotte. Too often, “wealth, not culpability, shapes outcomes” in our criminal justice system, he contends....
For full story:
http://www.charlotteobserver.com/opinion/opn-columns-blogs/eric-frazier/article22642515.html
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Ex-CEO of Lehman Brothers Denies Company Was Broke
May 29, 2015 | News Talk 106-108 FM
By Ruairi Casey
Seven years after the largest bankruptcy in US history, the ex-CEO of Lehman Brothers maintains that the bank was not broke.
Reuters reports Richard Fuld Jr told an audience of 1,300 at a micro cap stock conference in Manhattan that "Lehman Brothers in 2008 was not a bankrupt company."
Unwilling to place blame on himself, Fuld blamed the financial crisis on a "perfect storm" and the bank's collapse on short sellers, the federal government, and other outside factors.
"Regardless of what you heard about Lehman's risk management, I had 27,000 risk managers at the firm [all employees were shareholders] because they all owned a piece of the firm," he said.
Though later reports would show Lehman executives used accounting gimmicks to make its finances appear more secure, Fuld defended his decisions and said the collapse was fundamentally an issue of liquidity:
"You have to have enough liquidity to ride out the storm. Been there. Done that. No comment."
When asked by an attendee why he chose to make his first public appearance at an industry event, he said he was trying to move on:
"Not a day goes by where I don't think about Lehman Brothers." he said. "I'd love to tell you I'm over it, it's behind me. Doesn't happen."...
For full story:
http://www.newstalk.com/ExCEO-of-Lehman-Brothers-denies-company-was-broke
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Former Lehman Brothers Chief Breaks 7-Year Silence, New York Times Reports
May 29, 2015 | The Times-Picayune
By Jennifer Larino
Richard S. Fuld Jr., former CEO of Lehman Brothers, broke a nearly seven-year public silence Thursday (May 28), giving a speech to bankers that touched on everything from the Islamic State to the health of economy, but dwelt very little on his role in the largest bankruptcy in U.S. history, the New York Times reports.
The report says Fuld -- "the face of Wall Street's excess and imprudence" during the financial crisis -- was mostly "unapologetic" in his speech, pinning blame for the crisis on regulators and suggesting Lehman could have survived collapse if the Federal Reserve had not stood in the way.
The report says Fuld noted the economy still has major problems despite a strong appearance, including the lack of financing available to small companies and slow revenue growth even as corporations slash costs and jobs...
For full story:
http://www.nola.com/business/index.ssf/2015/05/former_lehman_brothers_chief_b.html
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Is Wall Street Ready for the Volcker Rule?
May 30, 2015 | The Market Mogul
By Fabien Paradis
The Dodd-Frank Reform Act and Consumer Protection Act was signed into federal law by President Barack Obama in July 2010. Passed as a response to the subprime mortgage crises and the following economic and financial crisis, the implementations were the most significant changes to financial regulation in the United States since the regulatory reform that followed the Great Depression of 1939. The stated aim of the legislation is:
...The bigger issue of the battle between Dodd-Frank’s supporters and opponents is an uncertainty in regards to the exact operations of investment banks and levels of risk taken, especially when they are economically ‘too big to fail.’ Ex-Lehman Chief Richard S. Fuld Jr. took the brunt of the ramifications of such after Lehman filed for bankruptcy and stated:
“Hi, I’m Dick Fuld, the most hated man in America” tweet
More recently however, Fuld gave his first public remarks since testifying to Congress in 2008 about Lehman’s collapse and discussed the “perfect storm” that led to the financial crisis. The speech demonstrated some “unspoken” truths about the bankruptcy of Lehman; “Lehman Brothers was not at the edge of the liquidation in September 2008” but still demonstrated the opacity of such banks and has questioned the effectiveness of the Dodd-Frank Act.The Volcker Rule
Dodd-Frank is a sweeping regulatory initiative and there is no reason to believe that Congress got it perfect the first time around. It did not. But it is equally unrealistic to equate any small attempt to improve it as a wholesale assault on the desirable goal of avoiding a future financial crisis. Even today, five years after its settlement, Dodd-Frank is still an amorphous beast. However, one thing is clear: It does little to prevent the rent-seeking and regulatory arbitrages that have become the hallmarks of the 21st century bank. In many ways, the financial world that Fuld left behind seems somewhat of a distant memory, with the 2010 Dodd-Frank financial reform legislation designed to keep firms like Lehman from ever having a systemic effect on the world economy. Viral Acharya, a finance professor at New York University recently stated:
“Wall Street has changed…The incentives, and the ability, to leverage through the regulatory cracks, that ability has been shrunk dramatically, however imperfect Dodd-Frank might be” tweet A major legislative item within the Dodd-Frank framework that will be implemented in July 2015 is the Volcker Rule...
For full story:
http://themarketmogul.com/is-wall-street-ready-for-the-volcker-rule/
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