Category Archives: People

Andrew Ross Sorkin: The Information Broker

In this week’s New York, I profile star New York Times business reporter Andrew Ross Sorkin, the author of the blockbuster Wall Street book Too Big to Fail. Sorkin has had a meteoric rise at the Times. He started writing for the paper at 18, and took over the hyper-competitive mergers and acquisitions beat when he was just out of college.

Sorkin is more than a reporter. He’s a brand unto himself. He runs Dealbook, the Times‘ closely-followed Wall Street blog, writes a weekly column and makes numerous appearances on CNBC and Charlie Rose. But inside the Times, Sorkin is a figure of considerable newsroom conflict. Many senior reporters question his closeness to the Wall Street mandarins who are his sources, worrying that he might be repeating the mistakes of former disgraced Times reporter Judy Miller. Critics point out that he wrote glowingly about the private equity boom, and failed to see the real-estate and credit meltdowns before it was too late. With his book, Sorkin has set out to write the definitive account of the behind-the-scenes battle to save the financial system from ruin. Inside the Times, the debate over Sorkin is really a battle to define the narrative of the meltdown. 

Despite the criticism, Sorkin has achieved something most of his Times colleagues haven’t: job security. In an uncertain time for newspapers, Sorkin’s brand is assured. 

Read the full piece HERE

Ralph Cioffi, the Meltdown Fall Guy

The financial crisis has dragged on for two years already, and no senior Wall Street executive has been brought to trial. On October 12, Ralph Cioffi and Matt Tannin, two former Bear Stearns hedge fund managers, will be the first finance guys to go before a jury. The spring 2007 collapse of Cioffi’s $1.6 billion hedge funds was the first tremor that signaled the financial system was coming apart.

In this week’s New York Magazine, I preview the trial. What I find interesting is that Cioffi’s trial has become a proxy for the legions of Wall Street bankers and traders who gambled recklessly with leverage and exotic financial instruments, only to see the whole system go up in smoke. Prosecutors have compiled a bunch of embarrassing emails from Cioffi and his partner, Matt Tannin, that suggest they knew the market was tanking even as they tried to line up new investors. Sure, it looks bad. But the heads-I-win-tails-you-lose culture was rampent late in the bubble. Goldman’s prop trading desk famously shorted sub-prime real-estate even as they sold mortgage-backed securities to their other clients. It’s all too easy to dispose of a few foot soldiers like Cioffi and Tannin while ignoring the perverse culture of reckless investing and greed that incentivized this kind of behavior in the first place. The question remains open as to why, even now, no senior executive, from Dick Fuld to Joe Cassano to John Thain, has been charged with any wrongdoing even though the bubble happened on their watch, and was largely a result of their profit-at-any-cost management style.

It’s been a lonely time for Cioffi since prosecutors paraded him in front of reporters last June. No one from Bear’s senior ranks–Jimmy Cayne, Warren Spector, Ace Greenberg–has called since his indictment. Alan Schwartz, Cayne’s successor, called once. Meanwhile, Cioffi has liquidated his luxurious lifestyle. In July, he sold his Southampton home for way less than the $11 million asking price. He’s quit his country club memberships. His Tenafly, NJ home is in contract. And he’s sold two of his three Ferarris, while awaiting a buyer for the third. Any takers?

Read the full piece HERE

Wolffe at the Door

I have a new TNR piece out on former Newsweek writer Richard Wolffe’s book proposal to write an insider-account of the Obama White House. Wolffe, who now works at Dan Bartlett’s corporate lobbying firm Public Strategies, has been generating headlines in recent days for trying to occupy conflicting roles as both journalist and flack. On Friday, Wolffe guest-hosted “Countdown” on MSNBC, but this week the network said it should have divulged his PR affiliations. And now many are questioning the ethics of his trying to write a reported book about the Obama administration while also advising corporate clients that may benefit from policies passed by the White House.

Wolffe still desparately wants to be a writer. From the piece:

According to a person familiar with the book proposal, Wolffe’s project is titled “30 Days: A Portrait of the White House at Work.” In the proposal, Wolffe writes that he has personal relationships with Obama officials at “the highest level” who have already “expressed support informally” for the project. Wolffe envisions a fly-on-the-wall account of a month inside the White House, where he’ll be “capturing group dynamics and people in action.”
Read the full piece HERE:

Jared Kushner and the Making of a Manhattan Golden Boy

In this week’s New York, I report on the rise of Jared Kushner, the 28-year-old Observer owner and son of disgraced real-estate mogul Charles Kushner. Here’s an excerpt:

Jared Kushner exited the subway on Canal Street to find his world blown up. It was the morning of July 13, 2004, and Jared, on break from NYU Law School, was hustling to his internship at Manhattan District Attorney Robert Morgenthau’s office. His cell phone buzzed. He saw a text message from his younger brother, Josh, an incoming Harvard freshman who was interning at the Kushner family’s office in Florham Park, New Jersey, that summer. “Dad is not in the meeting today. Is everything okay?” Josh wrote. Jared quickly called his father’s cell phone.

“Dad, are you all right?”

“Well, not really,” Charles Kushner said. “They’re going to arrest me today.”

“For what?” Jared blurted out. “Is it because of the tape? I thought your lawyers knew about that. I thought it’s not illegal.”

“Apparently they’re saying that it is,” Charles said.

“Well, maybe now the whole story will come out,” Jared said. He hung up and tried to work for twenty minutes but couldn’t focus. He jumped in a car for New Jersey. By the time he arrived, his father had surrendered to the FBI.

——————-

The full piece is in the magazine and online HERE

Bob Woodward’s Plan of Attack

Washington Post legend Bob Woodward is now quietly working on a new book about the Obama White House. In the current issue of the New Republic, I have a piece that reports on Woodward’s new book project. In early May, the White House circulated a memo that told officials not to speak with authors before clearing the interview with the press office. The Obama White House, despite vaunted claims of “transparency,” is focused on controlling information just as every previous White House has been.

Woodward told me he’s not worried about the Obama team shutting him out. “People make their individual choices about what they’re going to do, even in the White House and in the government,” he said. “Over my four decades of working on books, you find that some people will help, some people won’t help, some will help at certain stages and not at others, some people won’t help at the beginning but will help later on. That’s reporting.”

Now the parlor game begins. Who in the Obama orbit will be cooperating…

Read the full piece HERE

The Rage of the Rich

In this week’s New York Magazine, I report on the anger felt by many on Wall Street. Deprived of their bonuses and Master of the Universe status, there’s a deep resentment and woundedness on Wall Street. As hard as it might be to imagine sometimes, yes, rich people have feelings. From the piece:

In a witch hunt, the witches have feelings, too. As populist rage has erupted around the country, stoked by canny politicians, an opposite rage has built on Wall Street and other arenas where the wealthy hold sway. Its expression is more furtive and it’s often mixed with a kind of sublimated shame, but it can be every bit as vitriolic. “AIG pissed some people off, and now you’re gonna screw everyone on Wall Street?” rails a laid-off JPMorgan vice-president.”

Read the full piece HERE

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Clash of the Utopias: Tishman Speyer, BlackRock and the $5.4 billion Battle for Stuyvesant Town

In this week’s New York Magazine, I report on the unfolding meltdown of the biggest real-estate deal in American history. In 2006, Tishman Speyer and BlackRock bought Stuy Town and Peter Cooper Village for $5.4 billion. It was the highest price ever paid for a single real-estate transaction. Now, the deal is being buffeted by a cratering market, crushing leverage and a brewing feud with thousands of rent-stabilized tenants.

From the piece:

But by 2006, the sun seemed to be setting on the middle class in Manhattan. The blasting real-estate scene gave a whole new meaning to “market rate” apartments, and fewer and fewer people in the city believed in rent stabilization as a core value. The complex seemed a kind of anachronism—and, to the Speyers, a huge opportunity. To start with, the phrase “80 acres of Manhattan” is, to real-estate men like Rob Speyer and his father, a talismanic incantation. But it was more than just the acreage. Rob had a vision. He believed that by adding amenities and remodeling apartments—and forcing out longtime tenants who held on to their apartments in violation of rent-stabilization law—they could make Stuy Town hospitable to the new armies that were increasingly populating Manhattan, the recent college graduates with jobs in marketing and finance who worked long hours and wanted a full-service experience (including even a putting green).

Read the full piece HERE