Dangerous Dreamers: The Financial Innovators from Charles Merrill to Michael Milken

by Robert Sobel

Overview

In this fast-paced account, Robert Sobel analyzes the causes of the "Junk Decade" against a backdrop of incisive portraits of the perpetrators of some of the most dizzying and daring financial machinations the world has ever seen. Dangerous Dreamers is the story of clever scoundrels and brilliant innovators, such as Ivan Boesky and Michael Milken. It is also the story of the big banks, the pension and mutual funds, the insurance companies, and the S & Ls, who had a critical role in this period of financial instability.

Product Details

ISBN-13:	9781587983177
Publisher:	Beard Group, Inc.
Publication date:	07/21/2018
Sold by:	Barnes & Noble
Format:	eBook
Pages:	276
File size:	2 MB

About the Author

Robert Sobel was born in 1931 and died in 1999. He was a prolific historian of American business life, writing or editing more than 50 books and hundreds of articles and corporate profiles. He was a professor of business at Hofstra University for 43 years and held a Ph.D. from New York University. Besides producing books, articles, book reviews, scripts for television and audiotapes, he was a weekly columnist for Newsday from 1972 to 1988. At the time of his death he was a contributing editor to Barron's Magazine.

Table of Contents

	Introduction	1
I.	Precursors
1	Louis Wolfson--The Junkman	9
	The Power of "Creative Destruction"	13
	The First Conglomerateur	14
	The Great Montgomery Ward Raid	16
	Sewell Avery Fights Back	19
	Wolfson's Fall	21
2	Charles Merrill and the Rebirth of Wall Street	23
	The Era of Safety First	25
	The Coming of People's Capitalism	29
	Charles Wilson and Pension Plan Socialism	32
	The Great Bull Market	33
	The Growth Mania	34
3	James Ling and the Conglomerate Era	37
	The Birth of LTV	38
	Project Redeployment	41
	Golfball, Goofball, and Meatball	42
	The Unraveling	46
	Endgame	49
II.	Michael Milken and the Junk Decade
4	Michael Milken--The Outsider	55
	The Great Inflation	55
	Creativity on Demand	58
	Enter Milken	62
	The Academic Foundations of Milkenism	64
	The Early Years at Drexel	71
	Relationship Trading	75
	Invading the Market	78
5	Weaving the Drexel Network	81
	The Deregulation Earthquake	81
	Tom Spiegel and Columbia S&L	84
	Fred Carr and the Revolution in Insurance	86
	Doing Deals	90
	The Milken Partnerships	93
	Drexel's Failures	95
	Leveraged Buyouts: The Early Deals	96
6	The New Breed	100
	The B-School Brigades	100
	The Rise of "Ethnics" on Wall Street	102
	Insider Trading	107
	The Yuppie Generation	110
	The Rebirth of the Hostile Takeover	112
	Blackmail	116
7	Reinventing America	121
	The Birth of the New Bull Market	121
	Attacking the Mismanagers	123
	The Rise of the Trader	125
	The Use of Junk in Corporate Creation and Takeovers	128
	Rationalizing Takeovers	129
	Beatrice and ITT	131
	Plums in Petroleum	133
8	T. Boone Pickens and the New Corporate Raiders	136
	Boonc Goes Hunting	138
	The Gulf War	140
	Drexel as Predator King	146
	The Business Roundtable Battles Back	147
	"Cameomail" from Phillips	149
	Don't Go Hunting Without It	153
III.	Debacle
9	The Counterattack	157
	The Antitakeover Alliance	157
	The Contest for Unocal Begins	159
	Fred Hartley Goes to Washington	161
	Fueling the Regulatory Fires	164
	Unocal Beats Back the Raiders	165
	The Takeover Debates	169
10	The Great Debacle	172
	The Two-Pronged Assault	172
	Boesky Talks	174
	Giuliani and RICO	176
	Targeting Milken	178
	The War on Drexel	179
	Capitulation	182
	Firrea: Congress Piles on Junk	183
	The Crusade Continues	186
	The Academic Evidence on Junk	187
	Milken Predicts the End of the Junk Era	191
	Drexel's Demise	194
11	Crime and Punishment	198
	What Was Milken's Crime?	199
	The Fatico Hearing	204
	In the Court of Public Opinion	209
	Kimba Wood and the Art of Sentencing	209
	Prison	212
	Demonization	213
	The Shadow of Anti-Semitism	215
	The Verdict on Milken	217
	Notes	220
	Selected Bibliography	239
	Index	249

Editorial Reviews

Although Sobel ( The Big Board ) records such ``innovations'' as the Merrill Lynch small-investors-in-volume sales approach, Louis Wolfson's ``conglomerate'' pioneering and the corporate raidings of Boone Pickens, Sobel's liveliest concern here is the controversial ``junk-bond'' market of the 1980s and its star performer, Michael Milken. In a notably balanced chronicle, Sobel weighs government pressure (e.g., Milken was U.S. Attorney Rudolph Guiliani's ``ultimate target'') in the demise of Drexel Burnham Lambert against the junk-bond deregulation connection in the S & L debacles. Sobel also points to Milken's deft facilitation through pooled financing of still-flourishing business start-ups, and he implicitly questions the so-called ``Fatico hearings'' which allow a sentencing judge, as in Milken's case, to admit the presentation of evidence without an indictment. (May)

Publishers Weekly - Publisher's Weekly

Sobel, an author of several books on Wall Street, here chronicles the tales of four financial innovators who all pioneered some financial wrinkle: Louis Wolfson, in corporate takeovers; Charles Merrill, in ``people's capitalism'' (stock ownership); and James Ling, in conglomerates. As Sobel sees it, these three were precursors of Michael Milken, who masterminded the junk (high yield/risk) bonds. Once considered one of the nation's most influential businessmen, Milken has stirred strong feelings among both admirers and critics. Sobel here challenges most of what are perceived as Milken's sins, pointing out the importance of his role in financing companies that could not have otherwise obtained funds (MCI, CNN, etc.). Sobel calls Milken's prosecution a prolonged witch hunt that in effect made him the scapegoat for various unpleasant financial excesses of the Eighties. Most libraries will want this informative and entertaining work.-- Alex Wenner, Indiana Univ. Libs., Bloomington

Library Journal