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Notes to Chapter 4 563

27. “Hedge Funds, Leverage, and the Lessons of Long-Term Capital Management,” Report of the Pres-
ident’s Working Group on Financial Markets, April 1999, p. 14.
28. Edwards, “Hedge Funds and the Collapse of Long-Term Capital Management,” pp. 200, 197; and
Bloomberg.
29. Ibid., pp. 197–205; Roger Lowenstein, When Genius Failed: The Rise and Fall of Long-Term Capital
Management (New York: Random House, 2000), pp. 36–54, 77–84, 94–105, 123–30.
30. “Hedge Funds, Leverage, and the Lessons of Long-Term Capital Management,” pp. 11–12.
31. William J. McDonough, president of the Federal Reserve Bank of New York, statement before the
House Committee on Banking and Financial Services, 105th Cong., 2nd sess., October 1, 1998.
32. GAO, “Long-Term Capital Management: Regulators Need to Focus Greater Attention on Systemic
Risk,” GAO/GGD-00-3 (Report to Congressional Requesters), October 1999, p. 39.
33. “Hedge Funds, Leverage, and the Lessons of Long-Term Capital Management,” pp. 13–14.
34. Lowenstein, When Genius Failed, pp. 205–18.
35. McDonough, statement before the House Committee on Banking and Financial Services, October
1, 1998.
36. Andrew F. Brimmer, “Distinguished Lecture on Economics in Government: Central Banking and
Systemic Risks in Capital Markets,” Journal of Economic Perspectives, no. 2 (Spring 1989) (lecture by a for-
mer Fed governor, analyzing the Fed’s market interventions in 1970, 1980 and 1987, and concluding that
the Fed had consciously assumed a “strategic role as the ultimate source of liquidity in the economy at
large”); Kenneth Garbade, “The Evolution of Repo Contracting Conventions in the 1980s,” Federal Reserve
Bank of New York Economic Policy Review (May 2006): 33.
37. Harvey Miller, interview by FCIC, August 5, 2010.
38. Stanley O’Neal, interview by FCIC, September 16, 2010.
39. Fed Chairman Alan Greenspan, “Do efficient financial markets mitigate financial crises?” remarks
before the 1999 Financial Markets Conference of the Federal Reserve Bank of Atlanta, October 19, 1999
(www.federalreserve.gov/boarddocs/speeches/1999/19991019.htm).
40. “Hedge Funds, Leverage, and the Lessons of Long-Term Capital Management,” p. 16.
41. Ibid.
42. Ibid.
43. Philip Goldstein, et al. v. SEC, Opinion, Case No. 04-1434 (D.C. Cir. June 23, 2006).
44. Time, February 15, 1999; Bob Woodward, Maestro: Greenspan’s Fed and the American Boom (New
York: Simon & Schuster, 2000).
45. SIFMA (Securities Industry and Financial Markets Association), Fact Book 2008, pp. 9–10.
46. Board of Governors of the Federal Reserve System, Federal Reserve Statistical Release Z.1: Flow of
Funds Accounts of the United States, 4th Qtr. 1996, p. 88 (Table L.213, line 18); 4th Qtr. 2001, p. 90 (Table
L.213, line 20).
47. SEC Chairman William H. Donaldson, “Testimony Concerning Global Research Analyst Settle-
ment,” before the Senate Committee on Banking, Housing and Urban Affairs, 108th Cong., 1st sess., May
7, 2003.
48. SEC, “SEC Fact Sheet on Global Analyst Research Settlements,” April 30, 2003; Financial Industry
Regulatory Authority news release, “NASD Fines Piper Jaffray $2.4 Million for IPO Spinning,” July 12,
2004.
49. Arthur E. Wilmarth Jr., “Conflicts of Interest and Corporate Governance Failures at Universal
Banks During the Stock Market Boom of the 1990s: The Cases of Enron and WorldCom,” George Wash-
ington University Public Law and Legal Theory Working Paper 234 (2007).
50. Fed Chairman Alan Greenspan, “International Financial Risk Management,” remarks before the
Council on Foreign Relations, Washington, DC, November 19, 2002.
51. Ferguson, “The Future of Financial Services—Revisited.”
52. Spillenkothen, “Notes on the performance of prudential supervision in the years preceding the fi-
nancial crisis,” p. 28.
53. “First the Put; Then the Cut?” Economist, December 16, 2000, p. 81.