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turning to page one
turning to page one
They come through glass doors and enter a massive conference room with a commanding view of the city. It is filled with people along one side of the table. There are a team of five lawyers, three compliance officers, a couple of key board members, twelve in all. On the near side of the table sits RAMESH SHAH surrounded by empty chairs all alone. The head of the table is empty.
They all file in and sit down. They all sit in silence... waiting. Finally from a side door JOHN TULD comes walking into the room. He is dressed in a average suit and tie, is not tall, late fifties and doesn’t have a hair on his head. He carries himself without much exception. His eyes however tell a far different tale. Intense even at rest. He walks the length of the room, everyone half stands up.
JOHN TULD
Please sit down.
He then seats himself at the head of the table. Everyone in the room has the printout in front of them. JARED is seated immediately to his left, then SAM, then SARAH, RAMESH, WILL, PETER, and finally SETH.
JOHN TULD (cont’d)
Welcome everyone. I must apologize for
dragging you all here at such an uncommon
hour but from what I’ve been told this
matter needs to be handled urgently, so
urgently in fact that it probably should
have been addressed weeks ago...
but that is spilt milk under the bridge.
So why doesn’t someone please try to
explain to me what’s the problem here?
Everyone looks around the room a bit and finally JARED speaks up.
JARED COHEN
Well, Mr. Tuld as I mentioned earlier if
you look here at the top page of this
printout...
He cuts him off.
JOHN TULD
Jared, it’s a little early for all that,
how bout in English? ... Actually I’d
like to hear from the guy who put this
thing together... Mr. Sullivan is it?
Does he speak English?
JARED COHEN
Sir?
JOHN TULD
I’d like to speak to the analyst who
seems to have stumbled across this mess.
JARED COHEN
Well, that’s Peter Sullivan here.
JARED looks down the table to PETER, as does everyone else in the room. JARED gives him a go ahead look.
PETER
Sir.
JOHN TULD
Ah, there he is.
PETER
Yes sir.
JOHN TULD
How old are you Mr. Sullivan?
PETER
I’m twenty-seven sir.
JOHN TULD
Please call me John.
PETER
Yes sir.
JOHN TULD
So Mr. Sullivan why don’t you tell me
what you think is going on here, and
please speak as you might to a young
child or a golden retriever, I didn’t get
here on my brains I can assure you of
that.
PETER is very nervous.
PETER
Well, sir. As I guess you may or may not
know I work for Mr. Rogers here as an
associate in the risk assessment and
management office at MBS
JOHN TULD
Now you lost me at M...
PETER
Sorry...
JOHN TULD
I was joking Mr. Sullivan.
PETER
Yes... Well as you probably know over the
last 36-40 months the firm has begun
packaging new MBS products that combine
several different traunches of rating
classification in one tradable security.
This has been very profitable as I
imagine you noticed.
JOHN TULD
I have.
PETER
Well the firm is currently doing a
considerable amount of this business
every day. The problem, which is I guess
why we are here tonight, is that it takes
us... the firm... almost a month to layer
these products correctly thereby posing a
challenge from a risk management
standpoint.
JOHN TULD
And Mr. Sullivan that challenge is?
PETER
We have to hold these assets on our books
longer than we might ideally like to.
JOHN TULD
Yes.
PETER
But the key factor is these are
essentially just mortgages, so that has
allowed us to push the leverage
considerably beyond what you might be
willing, or allowed to do in any other
circumstance, thereby pushing the risk
profile without raising any red flags.
JOHN TULD
And how far have we pushed that profile
tonight Mr. Sullivan?
PETER
We have pushed it to 1.215 Trillion
dollars... at MBS alone.
JOHN TULD
Give or take.
PETER
Give or take.
JOHN TULD
Now Mr. Sullivan what I am guessing, and
give me a little rope here, what I am
guessing that your report here says is
that considering the, shall we say bumpy
road, we’ve been on the last week or so
that the numbers that your brilliant co-
workers up the line ahead of you had come
up with in the past don’t seem to make
much sense anymore considering what’s
taking place today?
PETER
Actually not taking place today but
what’s already taken place over the last
two weeks.
JOHN TULD
So what you’re saying is it’s already
happened?
PETER
Sort of.
JOHN TULD
And Mr. Sullivan what does your model say
that means for us here?
PETER
Well, that’s where it becomes a
projection. But...
PETER looks down at JARED for approval to go forward.
JOHN TULD
You’re speaking with me Mr. Sullivan.
PETER
Well... sir... if those assets were to
decrease by just 25 percent, and remain
on our books... well... that loss would
be greater than the current market
capitalization of this company.
The room goes silent. JOHN TULD looks at PETER long and hard. He then stands up and goes over to the window and looks into the city.
JOHN TULD
So what you’re telling me Mr. Sullivan is
that the music appears to be about to
stop and we are going to be holding the
biggest bag of stinking shit ever
assembled in the history of capitalism?
Everyone looks back at PETER.
JOHN TULD (cont’d)
Mr. Sullivan?
PETER
Well sir, I’m not sure I’d put it that
way but let me clarify using your
analogy, what this model shows is the
music, so to speak, just slowing, if the
music were to stop, as you put it, then
this model would not be even close to
that scenario. It would be considerably
worse.
JOHN TULD
Well let me tell you something Mr.
Sullivan. Do you want to know why I’m
sitting here in this chair with you all,
why I get the big bucks, so to speak?
PETER
Yes.
JOHN TULD
I’m here for one reason and one reason
only.
JOHN TULD continues to look out over the city for a long beat.
JOHN TULD (cont’d)
I’m here to guess what the music is gonna
do a week, month, a year from now. That’s
it, nothing more....... and I’m afraid...
standing here tonight... that I don’t
hear... a... thing... just silence.
The room falls completely still for at least half a minute. Then JOHN TULD spins around quickly with a considerably more upbeat tone and looks up and down the table.
JOHN TULD (cont’d)
So, now that we know that the music has
stopped, what can we do about it?
Long Silence.
JOHN TULD (cont’d)
Mr. Cohen, Ms. Robertson, I’m afraid this
is where you are supposed to step back
in. Lord knows we relied enough on Mr.
Sullivan today.
JARED and SARAH come to attention and gather their thoughts.
JOHN TULD (cont’d)
What have you got for us?
Long pause.
JOHN TULD (cont’d)
What have I told you since the first day
you walked into my office? (pause) That
there are three ways to make a living in
this business... Be first, be smarter, or
cheat. Well I don’t cheat, and even
though I like to think we have got some
pretty smart people in this building of
the two remaining options, it sure is a
hell of alot easier to just be first.
The room goes silent again as Mr. Tuld stares back out the window.
JARED COHEN
Sell it all today...
JOHN TULD smiles just a bit. Then turns.
JOHN TULD
Is that even possible Sam?
SAM looks across the room at JOHN TULD, they have known each other for 35 years.
SAM ROGERS
It is, but at what cost?
JOHN TULD
I’ll pay.
SAM ROGERS
Really?
JOHN and SAM look and read each other.
JOHN TULD
I think so.
SAM ROGERS
Almost a trillion bucks of paper?
JOHN TULD
Where does it come back to us?
SAM ROGERS
Everywhere.
JOHN TULD
Sam, I don’t think you seem to understand
what your boy down here just said... if I
made you... how would you do it?
SAM ROGERS looks down at the table for a long, long, beat.
SAM ROGERS
You bring the traders in for their normal
6:30 meeting and you be honest with them,
they’re gonna know it’s the end either
way, so you’d have to throw them a bone,
and a pretty big one. You’d have to come
out of the gate storming... 40 percent
done by 10:15 and 70 percent of your
positions need to be gone by eleven,
cause by lunch the word will be out. No
swaps, no nothing, and by two o’clock
you’ll be getting 65 cents on the dollar,
if you’re lucky, and the feds will be in
here looking up your ass and trying to
slow us down.
JOHN TULD
Ramesh?
He looks to RAMESH SHAH down the table.
RAMESH
They’ll slow you down but it’s yours to
sell. They can’t stop you.
SAM ROGERS
John... let’s just say we pull that off,
which is saying something... the real
question is... who are we selling this
to?
JOHN TULD
The same people you’ve been selling this
to for the last two years... and whoever
else will buy it.
They look at each other to see if they understand each other.
SAM ROGERS
If you do this you’ve killed that market
for years. It’s over.
JOHN TULD
(Nods.)
SAM ROGERS
And you are selling something you know
has no value.
JOHN TULD
(cuts him off cold)
We are selling to willing buyers at the
current fair market price, so that WE may
survive, Sam.
SAM ROGERS
You’ll never sell a thing to any one of
them again.
JOHN TULD
I understand.
SAM ROGERS
Do you?
JOHN TULD
Do you!!! This is it, Sam, this is it!
The rest of the table is taken aback and just watching them go at it. Silence.
JOHN TULD (cont’d)
It’s 4:00... Jared you’ve got till 5:00
to break this down and draw me up a plan.
Is there anyone else who actually knows
what’s in there right now, block by
block?
PETER
Eric Dale.
JOHN TULD
Where is Eric Dale?
SARAH ROBERTSON
As of today he is no longer with the
firm.
JARED COHEN
We have been trying to locate him.
JOHN TULD
So he is just out there with this
information?
JARED COHEN
(Nods yes.)
JOHN TULD looks down the lawyer side of the table to a secret service looking guy.
JOHN TULD
Carmelo?
LOUIS CARMELO
Yes.
JOHN TULD
Get me Eric Dale here by 6:30.
LOUIS CARMELO
Done.
JOHN TULD
OK, meet back here in an hour.
Everyone stands up and begins to scatter.
JOHN TULD (cont’d)
Sam... let’s talk.
JOHN TULD leads SAM through the back door.