All while dealing with a personal struggle. I had nine months to a year to live. They put me on aggressive chemotherapy. I said, i have an obligation to resign if i cant handle the chemotherapy. Robert benmosche was born in brooklyn in 1944. His father moved his family to the catskill mountains. He left the family was left a quarter Million Dollars in debt. From there, having enough money became a driving force in benmosches life. He rose up the ranks in some of the biggest firms in wall street. He became ceo at metlife. In 2009, he took on his biggest job. Turning around the ship at aig. It was in croatia that he took the job. At times, one of the most hated characters in the financial world. During a boat ride along the adriatic coast, benmosche explained how he fell in love with the country years ago. We came here in 1987 with about 250 people. So this was like their reward. They all thought it was a joke. And then they came here and said, this is unbelievable. I decided, in 2000 after the war with serbia, i would see if i could buy vineyards. In 2006, he did just that. Bought two plots of land. It was harvest season and he invited me to take a long as he checked the grapes. It looks like we will salvage something from this. It was here that he started getting calls from people like jim milstein at treasury to come back and take over aig. While life in croatia was serene, the u. S. Financial markets were in crisis. Walk me through what happened. I thought if aig failed, first and foremost the Insurance Industry would never be the same. Im a big shareholder in metlife. The first thought i had was metlife. It could be in big trouble if aig fails. The Second Thought was, i think it is bad for the country. If america can show they can fix business problems the right way. It would be bad for meritocracy and capitalism. Aig had just received one of the biggest government bailouts in history. 182 billion in exchange for a stake in the company. Few thought the company would survive. He started making headlines, floating conventions including going on vacation. Grandpa is on big trouble because he left his job to go on vacation after two weeks. You did a lot of things of that time. Can i name some of them . You said you had bigger balls than the government. That was in a private meeting. What i said was, i know they can come after us. The fact is, im not worried about the size of mine. The government is not going to tell me how to run this company. I am going to tell you how to run this company. That is what they hired me for. When you except that the job as ceo, you said, you are not going to work for ed liddy. When you came back, you didnt need the money. But you insisted on the pay. Absolutely. That set the precedent. People should be paid what they are worth. That is beyond a doubt. The messages, we are going to pay competitively for positions. I need to make sure the people have hope and opportunity. They are going to be paid competitively. If we deliver a free and independent aig. I did not want my pay to be a cause that pay is too high. Pay should be relative to your performance, the performance of your company, and the value you create. Coming up, going to war over bonuses. They spent 100 million watching people who earned 165 million for the work they earned. Benmosches fight over his own pay turned out to be a small fight compared to the fight over pay for employees at aig. He found himself in a fight over bonuses. The same unit that almost sank aig. I want to read a quote. He said, we are in effect at war. Over 165 million in bonuses. Why werent they at war over the 100 million watching people work . You tell me. Maybe i am nuts. Crazy enough to threaten to quit the job he just started if the bonuses were not awarded. You threatened to quit. What i said was, im going to announce my retirement in april, 2010. I will say we have stabilized and is this time to move on. If i cannot commit to a Compensation Program that made sense people were asking me to pay in aig stock. People in the administration and government did not think we could pay back the government. How much is the stock worth . Nothing. Why would you stay and get paid in stock . He did not step down and the bonuses were handed out. Afterwards, most of the highestpaid executives agreed to give the money back. But the outrage over the bonuses and his compensation lingered. Can you understand the public frustration . Not only at the time but even now. The frustration with pay. Can you understand that . I understand part of it. You have to understand, they gave me 10. 5 million a year. They thought they had a company of zero value. Actually negative. Today, that market cap, not the equity, the market value is almost 80 billion. If i said to the american public, i can create an 80 billion company and i will give it back to you with a profit, but i want 1 or 2 , they would give it to me. They dont see it that way. They dont understand what was created. They think the rich are getting richer. All the rich are enriching their friends. They see that. In 2009, march, i took every penny i had and bet on the market. What are we talking about . We are not going to discuss them numbers. Several americans did it. Guess what. It paid off. If you look at what happened in the fiveyear time, there has been huge growth. Are you saying a rising tide rises all boats . Im saying you have to take a risk. If you take a risk and win, you should not be blamed for winning. The people who lose did not do so well. What he found when he first opened aigs books. I didnt figure it was that bad. The world thought they were worse than they were. Compared to other wall street titans, Robert Benmosche is less recognizable but you couldnt tell on the streets of dubrovnik. He recalled the first time he took on the job with aig. I did not look in the books. I had a good idea of what was represented i what was in the books. I spend a lot of time with jim milstein. He was the restructuring executive who was handling this for the u. S. Treasury. I spent a lot of time with the person handling it for the new york fed. I question them about the financials. When they briefed you on what was going on, with a better or worse than you thought . The world thought they were worse than they were. You did not . I didnt think it was that bad. If the outside world thinks it is that bad, i have to get you to stop talking about how bad it is. In energy was expected to be broken up and the best parts sold off. Tim geithner said he wanted aig successful enough so the taxpayer can get out. Benmosche had different plans. He was going to revive the company and pay the taxpayer back. Did you ever think you would not . I did not think i could not get it done. What i said was, in september of 2009, i think what you are going to be left with is a 70 billion company. If you have 70 billion as your margin of error, there is no doubt. That was your back of the envelope. That was my back of the envelope calculation. I was wrong. It is 100 billion. Our market cap is 80 billion. When they finally pay back the american text areas with a 23 billion profit, the committee took out ads taking the american people. But benmosche felt the officials to him fell short. Was that the first time you had lunch with him . They met with me when they signed the deal that gave them 92 ownership of aig. The question was, how are we going to sell all the shares . When they saw me at the end of 2012, that would have been more meaningful. Why . They should have said, what we put the people of aig through was horrific. I want to say that it is incredible what they have accomplished. To not only pay us back, give us the 23 billion profit, but you have kept all the americans employed. You have kept them as effective citizens of our country. We thank you for that. They never said that. They never said that. It almost sounds like you are looking for it an apology. People should recognize they did a great job under the worst of conditions. Does it still pose a threat to the Financial System . I dont the can other aig will happen. We are not going to see another aig crisis. No. We have been in this position for over two years. I dont think we will see a bank failure that we have seen. A Security Industries failure like bear or lehman. You give a thumbs up to the regulators. I give them a thumbs up for getting the job done but a thumbs down for failing to tell the public. I have criticized people in washington. Why dont you talk about how much progress you have made . Their answer is, we are not sure something cannot go wrong. I say, shame on you. When we come back, Robert Benmosches villa splendid lives up to its name. And he gets personal about his fight with cancer. How are you . Hi, betty. Show me around your beautiful villa. In 2001, he began looking for a place to retire and settled on an abandoned the villa. This whole place is a wreck. Cracked tiles. But i looked at the view and said, wow. There arent very many views like this in the world. They bought the property for about 1 million and spent millions more fixing it up. All i preserved was the outside walls. Every thing built from inside. On a cliff above the sea, it has 12 bedrooms, eight bedrooms, and three kitchens. It is aptly named villa splendid. He imagined himself relaxing and hosting parties. What he did not expect was the terrible news that came in 2010. Cancer. It is a terrible diagnosis. One thing i learned in the Life Insurance business is everybody dies. We are just not told a timeframe. You have the luxury of imagining years beyond where today is. Did the doctors say you have x number of years . In general for this illness, cancer . In general, i have nine months to a year to live is what i was told. Then they put me on aggressive chemotherapy. Normally, you are supposed to get it over three days. I asked them to do it in a day. I have an obligation to resign if i couldnt handle it. They said, ok we can but we do not like to do it. Than we did a scan and it had no effect. They put him on an experimental treatment which did work. His 12 month prognosis stretched to three years. You never disclosed which cancer you had. If i were comfortable disclosing it, and it would help people, i would. I dont want to give people the concern that he will not be here long. And secondly, i dont want to be able to tell people, i want to do what he did. There is no miracle drugs here. It is the pipeline that counts. I think it is premature to get into a conversation about it. But the treatment stopped working. They reset the clock nine months to a year. When . Back in may. The board and i met in april. We said, i think you need to do some major changes in the organization. They were concerned about me changing the organization dramatically. Announced a new ceo. I said, that is great. We were thinking about the First Quarter of next year. I said, im not going to play the odds and changes have to be made now. I said, lets accelerate my retirement. The board was happy to do that. On september 1, he turned over the ceo role to his chosen successor, peter hancock. The transition was smooth and quiet. A vast difference from the days when he took over. If theres some sort of secret that you can dispel for somebody with a diagnosis like that but still able to turn around a multibillion Dollar Company how do you do that . You have to focus on living. There are times in my life that had the diagnosis, and the consequence of death came, it would have been devastating. Had it happened in the middle of getting aig to the point that we completed the restructuring. Completed the 92 ownership of Common Shares to the government. That would have been devastating. It would have been devastating in 2005, when i was still getting this house finished and ready for my retirement. When you thick about your death, thick about what you have accomplished. If there are things that are worrying you about legacy, my father left behind a wife with four children. No will. 250,000 in debt. Were there moments where you sat down and thought about that . Went to a dark place . I was never in a dark place. I felt the hardest thing is telling denise. Then telling my son and daughter. And then close friends. Say to them, unfortunately, theres going to be a timeframe here. Lets think about all the things we can celebrate of what we have already done. And done with the corporate world. Now it is time to enjoy everything he has. My mother said, enjoy life when you are healthy. Could you have enjoyed this 20 years ago . No, i did not have as much money. It comes back to money with you. This is taking stock for friday, september 26. I am pimm fox. Todays theme is shock. The u. K. And Prime Minister dane cameron enter the fight against Islamic State could be Royal Air Force sent to join the airstrikes in iraq. A fire in chicago since the shockwaves throughout the entire aircraft control system. What this means for business. All of that and more over the next hour. Another recall out of detroit. The automaker says it is recalling 850,000 cars in north america, setting up potential issues. Blackberry says it has sold 200,000 of its latest smartphone. The new product sold out in six hours on blackberrys website and in 10 hours on amazon. And nike stock surging big time today to a record high after its well cut Marketing Campaign rose revenue. Thank you. As we mentioned at the top of the broadcast, a big surprise from the world of mutual funds and finance. Bond king bill gross has left him cope. That is the firm he cofounded more than four decades ago. He is headed to Janus Capital. The move comes after the sec says he is being investigated for the total return. Earlier today mutual fund legend jack vocal spoke to us. There has been a lot of sniping out there, his leadership has been challenged. Im sure the sec investigation, and we do not know anything about the circumstances, all probably take their toll on a man who made in spite of his name and fortune may be easily hurt. We can all be easily heard. Maybe he woke up one morning and said i do not need anymore of this. I cannot read his mind, but that is a reasonable scenario. Now lets get some more insight on bill gross. Joining me from fort lauderdale, florida is a managing director. Also joining us is the rest of our panel. I want to begin with mark. You have known him for quite a while. What was your reaction this morning . I was absolutely stunned. I was shocked. I have known bill, personally, and i can tell you and all of my dealings with him for many years, he is an honorable, ethical, standup guy. I can absolutely say that without any question. What would believe you to believe lead you believe that this is anything other than his own desire . Could someone have really wanted him out from the firm that he helped to found . There are so many rumors it is hard to know what the truth is. He must have felt under some kind of distress or pressure, and knowing bill the way i do i would have said that he would have said that is enough and would have left. There are lots of right guys bright guys there at pimco, so their must have been some real chafing to cause him to move. You wrote a cover story about bill gross for bloomberg businessweek. What did you learn . It was evident when i spent time with him for a few months, that he was quite unhappy and frustrated. There was a lot of tension internally that was weighing on him. He was being distracted from invest thing, which is the thing he loves to do. That was a very tough time with a lot of scrutiny and gossipy press coverage. He felt very personally stunned by this. He was battling a lot of problems that founders of Successful Companies find, that he was a great investor that was so successful that he suddenly found himself in charge of running a enormous in organization. Management is something he does not want to do or is particularly good at. At some point there started to be some friction. What can you tell us about bill gross personally . He has been a noted stamp collector, once owned the worlds most valuable stamp. He is a practitioner of yoga. He founded this firm 40 years ago. He is a very simple guy, from his own description. He is an introvert. He is not a social guy who likes to go out in the evenings. He gets up extremely early on the west coast, and he is in front of his screen all day, and he likes to go home and just spend time with his wife and watch the daily show in what ever and look out at the ocean to bed early. He is a straightforward fellow. I think he has been really rattled by all of this tension. This is not something he is very wellequipped to deal with. There are financial implications here. The performance of the Pimco Total Return Bond Fund has come under a criticism. What does this mean for the investors in pimco funds . The news today, regardless of the regions behind it, it stands true that it was a huge shock. We saw treasury yields rise, we saw spreads widen a decline in the value of the shares of the parent of pimco. 16 months of outflows, it has been a tough time in the bond market, and he has been open about that. But it is true that that was adding to the managerial pressure and personal pressure that he was coming under it pimco. How investors may or may not be choosing where to allocate their capital. To they go for a specific fund, or do they look for managers that they believe in the longterm they can trust and they can rely on . I think the answer to that is both. It is certainly the larger firms such as blackrock, and so forth that have a great amount of stability. People are comfortable putting their money there. If you jeweled on further, you want to put your money with a very seasoned recessional professional who knows how to manage it all kinds of markets. Bill gross represents that. I think you will end up with some money that is going to leave pimco to go with him. The net result is that pimco will see some further out lows of gas outflows of cash, and it could be difficult for their parent to accept that reality. I want to bring in thomas of ernestine. What could you say of the potential outflow . Obviously they estimate anywhere between 10 and 30 outflows. And although we see indirect impacts, and ideally they are underlying investments, this is a young stock buy. What about size . When you manage a very large fund, you can do many great things but it does not move the needle. What about that aspect of this . It becomes difficult to manage a large fund, and it becomes more difficult we also have pressure of managerial responsibilities and overseeing six deputy cios. I spent the days begin with analysts and many of them say it is no question there will be outflo