all my life to get it. neil: that s not cyprus. that s here. i m talking about the s & l crisis. anybody remember that? a number of banks went belly up in the 8s and 90 asked some cost the taxpayers more than $124 million. and my buddy bill hammer knows first ham, his parents lived through this. bill, tell us what happened. dark days, neil. this was 1985. there was a run on the banks. rumored across the state of ohio. the governor ordered all the s & ls closed and only those that were fdic were able to re-open. my parents, raising five kids at the time, had all their life savings in a savings and loan and when the governor allowed some of those to re-open, the word spread like wildfire, and the paranoia set in as well
trigger that tests the computers. whatever the trigger was, it was portfolio insurance, the market recovered, very, very quickly. there was no economic crash. neil: there was no depression, you are right and dagen the fears we ll see a world economic winter was proven wrong but but that was that was a neil: a couple years later. listen, we had an s and l, what are we missing, the s & l crisis and the junk bond crisis. neil: i m not blaming it on that. by 1989 we re in a recession. two years later. markets are forward predictors. that crash. that crash, 25 years ago, was. neil: won t change your mind. it is totally right. neil: we ll see about that. i think i know you saw me, in my pre-puberty stage, pontificating okay, please. you were doing hollywood movies, you were clueless. i remember the discussion
they may sh have cheated clients. some believe they lied about it to congress and now a top lawmaker want goldman sachs brought to justice. it is a senate investigation that has described the banking system as a financial snake pit rife with greed, conflicts of interest, and wrongdoing. and it seems that one of the targets of that investigation is goldman sachs chief lloyd blankfein. will he and others responsible for the financial crisis be ever held accountable? william cohen is the author of money and power: how goldman sachs came to rule the world, and he joins me now. bill, two-and-a-half years later, why haven t we seen a single prosecution of anyone on wall street 123. you know, that is such a good question. we thought we were going to get the prosecutionings. first wet the indict of the two
hi, martin. how are you? if i handed you a bag of marijuana live on air with about two ounces in it, i would be prosecuted. how is it possible that we have hundreds of billions of losses, a financial mess of reckless lending, excessive risk, and not one prosecution? this is the question i think that everyone is asking. i know when i meet people, they want to know this answer. we tried to get to the bottom of it in the newspaper today. i think that there are several answers. one though that really, really stands out, martin, is that in the years leading up to the crisis and after it had begun, the regulators who are very knowledgeable about lending practices, financial accounting, you know, the kinds of arcae a arcane arcana, they were not
wrong, which their own documents show that that decision they made to bet against the mortgage market at the same time they were continuing to underwrite mortgage-backed securities, that s a message he doesn t seem to be able to get. senator levin tried as he might and couldn t convey it to him either. yet in the public courts it seems as though the fact that these guys make so much money is their great saving and that when we have a discussion like this, when you publish your book, people say we re whining, we re jealous, we re in effect jealous of the amount of money they make. why has this issue not been picked up more aggressively by people beyond interested journalists by yourself. frankly, i don t understand why investment bankers get paid as much as they do. i was an investment banker for 17 years. i didn t understand why we got paid so much. i had been journalist. i would have thought after this crisis it would have been a real opportunity to fix the incentive system on wal