All The Devils Are Here: Unmasking the Men Who Bankrupted the World (78 page)

CEO. See
O’Neal, Stan

establishment of,
159

First Franklin acquired by,
238–39

post-bailout bonuses,
360

risk management, lack of,
236–38
,
316–17

subprime exposure, extent of,
309–10

synthetic CDOs,
311–13

Merrill Lynch Mortgage Capital,
19

Mexico, credit crisis,
96

Milken, Michael,
72

Miller, Tom,
206

Mital, Aseem,
207

Mobasheri, Ardavan,
289

Mondor, Paul,
34

Money market funds, and repo market,
241–42

Money Store,
34
,
217

Montag, Tom,
274
,
278

Moody, John,
112

Moody’s,
110–24

CDOs, downgrading,
298–300
,
305

CDOs, rating,
120–24
,
297–98

under Clarkson,
115–20
,
124

comments after CDOs crash,
306–7

derivatives high rating, reasons for,
111–19
,
122–24
,
297–98

downgrading of (2007),
305

establishment of,
111–13

growth of,
111–13
,
123–24

reform, lack of,
119–20

Moral hazard,
172
,
345
,
347

Morelli, Robert,
299

Morgan Stanley

establishment of,
54

GSEs, analysis of,
354–55

survival after collapse,
359

Morrice, Brad,
251

Mortgage-backed securities (MBS)

blue sky laws exemption,
13–14

CMOs,
13

Fannie Mae portfolio of,
47–48
,
171–86

first issue,
7

laws expanding growth of,
13–16

profitability of,
15

rating of,
8–9
,
14
,
31

rationale for,
4

REMICs,
16–17

risk weighting,
59–60

of subprimes.
See
Subprime mortgage-backed securities (subprime MBS)

tranches,
5–8
,
15–16

Mortgage Bankers Association,
149

Mortgage Guaranty Insurance Corporation,
19

Mortgage originators

Ameriquest,
128–37

Countrywide Financial,
20–28
,
138–45

crisis of 1998,
82–84
,
93

going public,
82
,
87
,
128

hard-money lenders,
28–32

write-downs,
82–83

Mortgages

adjustable rate,
29

conforming,
18
,
23

to credit risks.
See
Subprime mortgages

Federal Reserve authority over,
85–86

first- and second-lien,
28–29

prepayment risk,
7–8

securities based on.
See
Derivatives
;
Mortgage-backed securities (MBS)
;
Subprime mortgage-backed securities (subprime MBS)

Mozilo, Angelo,
21–26

biographical information,
21–23

and Countrywide collapse,
303–5

exit package,
141

homeownership as mission,
35–36

SEC fraud charges,
143
,
220
,
230–31
,
362

style/personality of,
24–26
,
37
,
138
,
219–20

subprimes, view of,
36
,
138
,
219–20

See also
Countrywide Financial

Mozilo, Mark,
141

Mudd, Daniel

during collapse,
342–43
,
352
,
355

Fannie under,
49
,
181–86

on Johnson era,
41

Multisector CDO,
189–91
,
200–203

National Association of Affordable Housing Lenders,
48

National Community Reinvestment Coalition,
48

Nationally Recognized Statistical Ratings Organization (NRSROs),
8–9

National Predatory Lending Task Force,
88

Nayden, Denis,
45

Netting out,
63

Nevins, Lou,
15
,
17

New Century,
261

New Century Financial

collapse of,
251–52
,
256

fraud, view of,
207

Goldman deals,
271–72
,
275–76

growth of,
127–28

Merrill buyout plan,
233

Nicolaus, Stifel,
301

Norell, Lars,
265

Norma,
312–13

Northern Rock,
344

Noto, Tom,
205

Obama, Barack

Arnall supported by,
210

regulatory actions,
358

Off-balance sheet investments,
60

Office of Federal Housing Enterprise Oversight (OFHEO),
39–43

establishment of,
39–40

under Falcon,
174–76

Fannie, regulatory weakness,
40–43
,
170
,
174–76
,
185

Fannie accounting fraud investigation,
177–81

and GSEs collapse,
348–49
,
353
,
355–56

See also
Federal Housing Finance Agency

Office of the Comptroller of the Currency (OCC)

preemption policy,
146–48

subprime crackdown,
94–95

Office of Thrift Supervision (OTS)

Long Beach discrimination case,
32

preemption policy,
146–48

subprime guidelines,
214–15

subprimes, neglect of issue,
94–95

O’Neal, Stan,
160–67

biographical information,
160–61

and CDO collapse,
308–11
,
314–21

CDO exposure, ignorance about,
314–18

Kronthal firing,
233–34

leaves Merrill,
321

Merrill Lynch under,
160–67

Patrick/Zakaria firing,
162
,
232

risk encouraged by,
163–67
,
234
,
236

and sale of Merrill,
318–21

Semerci hired by,
234–36
,
239–40

style/personality of,
162
,
235
,
309
,
315

See also
Merrill Lynch

O’Neill, Sandler,
304

Option One,
34
,
128

Orkin, Michael,
306

Overcollateralization,
31

Ownit,
165
,
252
,
313

Parekh, Ketan,
135

Park, Gene,
200–203

Parker, Ed,
133–34

Partnership offices,
43–44

Patrick, Deval,
32–33
,
208

Patrick, Tom,
162
,
232

Paulson, Henry, Jr.,
245–50

and Bear Stearns buyout,
347

during collapse,
343–46
,
349–57

compensation from Goldman,
157

derivatives, regulatory efforts,
247–49

Goldman Sachs under,
152–55
,
245

GSEs, approach to,
345–46

and Lehman collapse,
349–51

style/personality of,
153–54
,
246–47

and TARP,
359–61

Paulson, John,
260
,
263
,
279–81

Pay As You Go (PAUG),
259

Pay option ARMS,
135–36
,
228
,
230

Pelosi, Nancy,
346

Pension funds, MBS, buying,
9
,
14
,
31

Phillips, Dan,
34