YouSaid · the spoken record

Jim Millstein

lines on the record: 103
first: 2018-10-26
most recent: 2018-10-26
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“And that price I may not hold, and it may reflect supply demand dynamics rather than fundamental value. It may reflect the interest rate policy of the Federal Reserve as compared to where it was when the bond was originally issued. There are lots of market participants today who live by their marks and are judged by their marks and are measured by their marks and are compensated by their marks. That is the biggest difference, right? I used to sit in rooms in the 1980s with banks and insurance companies and talk about fundamental value. And the mark didn't matter. They were trying to do is maximize the recovery of their position. And today you sit in a room with traders who are trying to maximize their liquidity and their mark. And very different from fundamental value.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“The shadow banking system starting with the junk bonds created by Mike Millican in the late 80s. You know, we have a bond market that now dominates credit intermediation, and the bond market has greater and greater transparency with secondary, you know, with trades all the time and prices. So there's a There is the illusion of fair value created by the day to day pricing of a given bond.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you know, this has been, we talked a little bit about the deregulation of the financial system. I mean, the consequence of that is we went into the 1980s with a bank-centric financial system. Where credit intermediation was primarily conducted by banks, we came out of the financial crisis after 40 years of deregulation with a market-centered funding system. And the development of the secondary markets and the secondary credit markets.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So Trista, just as we were talking about before, is a choice between business school and law school, I'd say, go to law school. Get firm grounding in the law. You know, it's been a great career for me. I like being a problem solver And each of these restructurings is different, as I said before, but in effect you're taking something and making something out of a failure. And sometimes something is just redeploying the capital and liberating the capital that's involved in a bad business. But most of the time, you're figuring out what went wrong and fixing it. And saving capital and jobs and so you can kind of feel like you did something good.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“All of that, all of those basic social system supports. And yet their dynamic economies with entrepreneurship and growth rates that rival ours. Now they're small, homogeneous countries. They don't have the Many of the challenges we have in establishing commonality. But these are what the right would call social welfare states that are functioning where the gap between the richest and the poorest is only three times, not the 300 times it is in the United States. And yet they've maintained a sense of entrepreneurialism and dynamism in their economy. The nanny state is not necessarily deterring dynamism and entrepreneurship in the economy.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“For Americans. And particularly given our current dispute about the role of government. and inequality. A trip to these countries should be mandatory because they have National healthcare. They have subsidized. They have affordable housing subsidies.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Up and down the fjord country, it was gorgeous. Really food was spectacular and we had a stopover. The way to the hike in Oslo, and on the back, and then on coming back in Stockholm. And Stockholm is just an amazing city. Really? An amazing city. And these two countries actually really”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I hike, I've got a group of friends that we've gone on various trips across the round, you know, hiking and exhausting ourselves. That's been, you know, any place interesting recently? We went to Norway last year or the year before. Justin.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so, you know, the lesson, the failure was a failure of imagination, a failure to realize that the law is not a given, but something that is created and constantly created every day.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so we were resisting filing it. And Leonard thought that we were being irrational and impudent. And so he did something that I didn't believe could be done. He filed an involuntary petition. The creditors put the company into bankruptcy in Canada. And under Canadian law, I had been advised by my Canadian co-counsel. This was not a procedure available to creditors. And so Leonard picked up the phone. So he called me one morning. He said, I think you need to be in Toronto this afternoon. And I said, why? He said, because we have put the company into a CCAA proceeding in the Ontario Superior Courts this morning. And I said, you can't do that. He said, well, we did. We just did.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. And he was just a gentleman and a scholar and a wonderful person. And we were having a dialogue as to how we were going to land this company in a restructuring, he representing the creditors, me representing the debtors. And we had, as you can only have with Leonard, a kind of gentlemanly disagreement with regard to sort of what the end game was, who was going to end up owning the company, and how we were going to restructure it. We were resisting putting the company in front of a judge too soon until we had an agreement with the creditors because most bankruptcies are less expensive and less time consuming. It's pre-packed, right? The judge is there to confirm what everyone's agreed rather than to mediate the dispute ongoing.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so I was in as a young lawyer, not so young, I was handling my first major cross-border restructuring. And the creditors were represented by one of the greats of the bankruptcy bar, Leonard Rosen at Wachdell Rosen, Lipton, and Katz.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“With the New York Giants having gone one and four to start this season, I'm just so depressed. It's very hard to focus on anything other than that for the moment, still licking my wounds.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“But I think the fundamental insight of sapiens is really important, which is the success of the species has been our ability to collaborate around abstract concepts. Our communications obviously key, the development of language and all that, but then the ability to collaborate and coordinate our behavior around abstract concepts, concepts of God, concepts of nation, of state, of community. I mean, these are all abstractions. You can't visualize the nation except through symbols and through a summary of its history and a set of objectives that you might believe are important to it to achieve in the future. And, you know, to me that's the big challenge of that the country faces is an ability again to figure out how to collaborate together on a common future across this very diverse country.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm a nonfiction reader, and again, after having gone through a major historical event. And had a ringside seat. I've been reading lots around it. But I think the most interesting nonfiction book I've read, unrelated to the financial crisis, is a book called Sapiens.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, there's been lots of influences on that. But I mean, I think the important point here is that... I have found that there's really no upside to dishonesty. And that, you know, people who can't be trusted are people who are not going to get stuff done except in dark rooms and back alleys. And so if you want to work in the social, political, legal, business world, your reputation is the most important thing you have and observance of ethics and honesty. I know this is a counterfactual in this administration, but the observance of ethics and honesty is extremely important to your long-term success.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the thing is, he loved, when I was growing up, he just loved what he did. So, I mean, it was hard, you know, not to look at him and be with him and not see the law as something that was incredibly engaging. And because for him it was, and as has been for me, a mix of crossing between private sector and public sector. I mean, the law, the rule of law is what governs our private relations. But someone has to create them. Somebody has to create that law. Right.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I had a professor at Princeton, a guy named Sheldon Wolan, who recently passed, who is a political theorist. And a historian of political theory. And, you know, that's what I did my first years as an academic. So he had a very important influence on my intellectual development. As a career, I had a partner at Cliottleim, named Alan Applebam, who really taught me how to be a lawyer. taught me the whole how to deal with clients, how to analyze the situation, how to take a multi-parties with conflicting interests and produce a common result that was acceptable to them.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so, you know, in the 2009, we got Democratic-controlled Congress to do a stimulus, but Obama went back to the well in 2010 after the Tea Party took the Republican Congress. In 11. Just couldn't get it done. Went back with an infrastructure program, could never get anything through the Republican Congress. Well, McConnell.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think the big mistake politically was the stimulus. If you look at the Chinese, too small. The Chinese, you know, and if you look at what the federal government's doing now, right, these Republicans who were...”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“But you have the power, she said. You had the power to get Goldman Sachs, to give up a discount rather than to pay them off in full. Wasn't this a backdoor bailout of Goldman Sachs? And I was like, she wasn't Secretary. I was Professor Warren. So you tell me how I'm supposed to, as a government in the United States, how I'm supposed to play that hand. I'm supposed to benefit AIG's shareholders by taking it out of Goldman Sachs, when in fact we're standing behind both of these companies. The whole point was to avoid defaults across the system and to avoid AIG defaulting on any of its obligations because if it defaulted on any of its obligations, its credit rating would have been impaired and we would have had to write even bigger checks.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And she was beating me up that we should have tried to extract a discount from AIG's counterparties on their CDS on CDOs, which your audience probably understands what I just meant in those acronyms.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so I hear you on that. I actually got into a fight with Elizabeth Warren during a public hearing when I was testifying about what we were doing with AIG and ally financial.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so they had to make the terms of the preferred as relatively benign and painless as possible in order to induce widespread participation by all of the institutions. So there could be no picking and choosing of winners and losers.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, really? For bankrupting the company. Nice work. Here's a bonus. Now, the counter, you know, what Secretary Paulson would say. All the major institutions participate because we couldn't permit the negative inference that if Jamie Diamond held out that he was the only sovereign bank in America.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and I think most Americans were kind of, you know, right in the view of like, wait a second, you're paying yourself billions of dollars of bonuses with taxpayer money?”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Eventually they didn't sign off on the 2009 bonuses, 2008 bonuses. And I think that was the one, those were the bonuses that provoked the enormous political.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, the origins of the two-party or something we had made for a while, but no doubt the crisis had something to do with it. But I think the one, I mean, the one criticism I would have of the initial TARP program was that as long as the preferred stock was outstanding, the company should not have been permitted to pay the kinds of bonuses that they paid, right? I mean, as long as you're beholden to the federal government for equity on your balance, you shouldn't be paying bonuses.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. So I think, look, I think the structure of the TARP program, which was where we infused ultimately determined to infuse preferred stock equity into the balance sheets of all the major financial institutions, I think there could be some serious criticism of the way it was done, particularly by, I think it may have created more of a political backlash. For sure, against the program that it needed.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“They were very savable, and as a result of the asset sales, we managed to use the asset sales to pay off the Fed's loans. Leaving the federal government with $50 billion of preferred stock. We converted the preferred stock into 92% of the common stock. And so we now had a liquid market. And eventually we had a liquid market into which to offload the Treasury's shares of common stock.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So AI2 today is still one of the largest property casualty insurers in the world. It's one of the largest domestic life insurance companies and not a lot else. We sold off the aircraft leasing business, the consumer finance business. As I said, all these other worldwide life insurance operations.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Had ended, we had struck a deal with AIG's board for a complete recapitalization of the company. We had converted some debt into TARP equity, some fed debt into TARP equity along the way in 2009. And then we did a series of asset sales and restructurings from AIG. We reduced its balance sheet from a trillion dollars of assets to half a trillion of assets, selling off its Asian life insurance operations, its Middle East life insurance operations, its middle European life insurance operations, and a hundred other businesses along the way that they were involved.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Time to move on Well, I think the macroeconomic condition surely had eased. So the Fed had embarked on its quantitative easing. The markets had rallied, you know, the depth of the market, the equity market and the credit market were in May of 2009. By the time he got to the end of 2010, you had seen a rally back. The rallies had both started in both markets. And most importantly, by the end of 2009, the interbank lending market opened up again. The banks were actually comfortable enough with each other to start lending to each other overnight. And that was a pretty real sign of that that the crisis had passed. But, you know, I was part of the cleanup crew and part of my job was to get the taxpayers' money back. By the time 2000...”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“That could be met by a national core. And I think having the experience before you go to college of actually having to live and work with people different to yourself, but all of whom are American would be a great national unifier.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“National backgrounds into one little desert country. And it was a way of forging a national identity. And I think we have that problem in the United States now. We really, we're separating it into separate tribes and not just Democrat and Republican, but the identity policy. Urban versus farmer with the identities.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, but I also think I agree with that. And surely our schools can do a better job of developing that emotional intelligence and analytic ability, the ability to handle new feedback. But I also think that the social media has isolated in a funny way has isolated people from one another. It's isolating communities as much as it's creating cross-community, the possibility of cross-community communication. And so I've come around to the view that we really need national service. That in order to”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I agree with you. I think the legal education, I think it goes on maybe a year too long. Yes, for sure. But I think the training is unsurpassed”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Is a multi ethnic, multiracial society. You know, we have one of the greatest challenges, I think, in human history, which is can we create a tribe, one tribe out of many, you know, Epluribasunum. And it really is, it befalls to us as Americans to figure out whether we can make this a democracy out of many tribes.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the myths by which we live, right? I mean, you and I are immediate parents, their grandparents. You have to go probably back four generations before you have someone homesteading and protecting themselves and fending for themselves. And yet this myth of the American frontier is very powerful in our political ideology and therefore in our social policy. But the reality, you know, four generations later from the last homestead or the last frontiers woman and man.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Capitalism can be saved, but this has been true really since the Progressive Era. This is a joint venture between government and capital. To come up with a society that is productive and just.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Which means And then what? Okay, and then what? And so here's another book for your listeners. It's called Can Capitalism Be Saved by My Good Friday Steve Pearlstein, who's the chief economics writer of the Washington Post. And he's written a really thoughtful book about, is greed good, no. Is fairness going to make us poor? No. You know, it's a very serious treatment of the questions that we're now confronting as a nation with the highest inequality in American history.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“And one of the biggest policy initiatives of the Reagan administration and every administration since has been to expand the provision of credit. Where incomes were lagging and failing and falling behind, we substituted credit. No doubt about it. Widespread credit availability and levered up both the government to do so, levered up households in order to turn their homes into cash machines to supplement so they could supplement their incomes with the increase in the value of their homes to finance the purchase of everything under the sun from every consumer durable available through credit cards and installment credit.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“So here's another book, the obscure book that you might want to read called Capitalizing on Crisis. It's written by... Rippner, I think, is her name. Greta Gripner. And it's all about the political origins of modern American finance. And the story she tells, which I think is, you and I lived through. I think you're a little younger than me, but not much.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, but they're in defense of some academics. My friends Gary Orton and Andrew Metrick at Yale have done great writing about the confluence of events that led to The great innovation of a subprime mortgage of two-year teaser interest to 28, the 228 or the 327.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I know, but it's true, having run deficits and trade deficits, run deficits since the Clinton administration and run trade deficits since the 60s Know, we've been exporting dollars around the globe for 40 years At the same time that we were deregulating the financial system and the largest holder of dollars were there were two pools, huge pools of dollars offshore, one in Europe, China, Japan, and in Europe, right?”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm actually in the middle of reading Tuze's book, which I think is Adam Tuz. It's called Crashed. It just came out. It's very good because it takes a... It situates the crisis in the kind of macroeconomic environment of the early 2000s, of the early aughts. And, you know, if you've just cast, you know, the thing about the crisis is it kind of overwhelmed everything else that we might have been thinking and using as a frame of reference. It overwhelmed the introduction of the iPhone, which has had at least as important an impact on our culture and society as the crash itself had in 2008. You know, the iPhone introduced in 2007, but with two's highlights is, and it's relevant today to the existing problems with China, is we had a savings glut that we were all worried about, that we thought that I've always hated.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. And then, you know, Secretary Geithner wrote his book, and Bernanke wrote his book, and Paulson's written his book. And there have been a couple of lieutenants and sergeants who've written their books.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“But I think it's still too fresh. I mean, you have a lot of kind of, you know, from the front line accounts that have already been written And those were written”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. And you're still doing that at Georgetown. Yeah, I just finished the third semester of teaching on that with Tim Assett, who ran the CFTC in the last Obama administration. And he had also been a treasury with us in the TAR program. And so he and I taught that together, which was, you know, it was fund to do it with him my third time around. I think it's still too fresh. Really? From the point of view of writing a book. Yeah.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of doing what we did. So, all that said, when I got out of the government, having been a corporate restructuring guy rather than a financial regulation, financial industry banker, I determined that I needed to go teach a course on financial regulation and the crisis in order to figure out what I had just gone through.”
2018-10-26 · Masters in Business · Jim Millstein on the Fed and AIG’s Restructuring (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source