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Buffett on Salomon Brothers
Buffett on Salomon Brothers
Published: 2009/02/19
Channel: bid666
Gutfreund Blames UBS Trading Loss on Diminished Controls
Gutfreund Blames UBS Trading Loss on Diminished Controls
Published: 2011/09/15
Channel: Bloomberg
UB: Lider umano ng Salomon brothers, huli sa buy-bust operation
UB: Lider umano ng Salomon brothers, huli sa buy-bust operation
Published: 2017/03/23
Channel: GMA News
September 11 2001 - The Salomon Brothers Building WTC7
September 11 2001 - The Salomon Brothers Building WTC7
Published: 2016/09/10
Channel: Angel White
Securities Trading Investigation
Securities Trading Investigation
Published: 2011/06/30
Channel: HouseResourceOrg
Out of the Closet, on the Trading Floor
Out of the Closet, on the Trading Floor
Published: 2012/04/24
Channel: Big Think
The Billionaires Warren Buffett
The Billionaires Warren Buffett's Office Tour
Published: 2014/12/29
Channel: Warren Buffett
Warren Buffett on reputation: lose a shred and I will be ruthless (1991)
Warren Buffett on reputation: lose a shred and I will be ruthless (1991)
Published: 2016/02/22
Channel: FINN
The Men In Building 7 WTC
The Men In Building 7 WTC
Published: 2015/05/02
Channel: Real 911questions
Salomon Brothers Chicago 1991
Salomon Brothers Chicago 1991
Published: 2008/02/18
Channel: Chicagoguy68
Lessons from a biased coin flip experiment · Victor Haghani
Lessons from a biased coin flip experiment · Victor Haghani
Published: 2017/06/16
Channel: Chat With Traders
Becoming Warren Buffett (2017 Documentary)
Becoming Warren Buffett (2017 Documentary)
Published: 2017/02/25
Channel: Investors Archive
Lider umano ng
Lider umano ng 'Salomon brothers,' huli sa buy-bust operation
Published: 2017/03/23
Channel: GMA News
BBC Reports 911, WTC 7 Collapse BEFORE it Happens
BBC Reports 911, WTC 7 Collapse BEFORE it Happens
Published: 2013/06/04
Channel: PeaceGardenSecrets
Salomon Brothers
Salomon Brothers
Published: 2012/11/06
Channel: Christopher Hunt
hey brother avici cover by the solomon brothers
hey brother avici cover by the solomon brothers
Published: 2015/09/02
Channel: Solomon Brothers Band
Michael Lewis: I Would
Michael Lewis: I Would've Sucked on Wall St. (Oct. 29, 2014) | Charlie Rose
Published: 2014/10/29
Channel: Charlie Rose
Warren Buffett Interview - A Wise Words From Warren Buffet
Warren Buffett Interview - A Wise Words From Warren Buffet
Published: 2015/01/01
Channel: Warren Buffett
Salomon Brothers
Salomon Brothers
Published: 2014/10/30
Channel: Audiopedia
ENHANCED VERSION: News Reports WTC7 Fell Before It Happens!
ENHANCED VERSION: News Reports WTC7 Fell Before It Happens!
Published: 2007/02/27
Channel: suntereo
Warren Buffett Interview - There Is Only One Type Of Investment Risk
Warren Buffett Interview - There Is Only One Type Of Investment Risk
Published: 2014/12/29
Channel: Warren Buffett
Salomon Brothers - GTP 1999
Salomon Brothers - GTP 1999
Published: 2015/01/25
Channel: Alex Banks
The Chemical Brothers - The Salmon Dance
The Chemical Brothers - The Salmon Dance
Published: 2009/03/11
Channel: ChemicalBrothersVEVO
Aspen Words Presents: Michael Lewis at Winter Words 2015
Aspen Words Presents: Michael Lewis at Winter Words 2015
Published: 2015/03/16
Channel: The Aspen Institute
The Brothers Solomon trailer
The Brothers Solomon trailer
Published: 2007/05/21
Channel: BrothersSolomon
Bloomberg on How to Start a Business and Make Money: Financial Industry (1998)
Bloomberg on How to Start a Business and Make Money: Financial Industry (1998)
Published: 2014/09/21
Channel: Remember This
New Salomon Brothers
New Salomon Brothers' Building Footage
Published: 2008/12/18
Channel: truthgonewild
Salomon Brothers Building (WTC7) - kurz vor dessen Einsturz
Salomon Brothers Building (WTC7) - kurz vor dessen Einsturz
Published: 2010/11/20
Channel: Infokrieger119
The Worlds Greatest Investor - Warren Buffett Documentary
The Worlds Greatest Investor - Warren Buffett Documentary
Published: 2014/12/13
Channel: Investors Archive
Warren Buffett on Business, Analysis and Investing
Warren Buffett on Business, Analysis and Investing
Published: 2016/08/07
Channel: Investors Archive
האחים סולומון The Solomon Brothers  -LIFE  (Official Music Video)
האחים סולומון The Solomon Brothers -LIFE (Official Music Video)
Published: 2016/12/01
Channel: Solomon Brothers Band
Clip 3: Spiritual sickness and the downfall of Salomon Brothers (Templeton Foundation)
Clip 3: Spiritual sickness and the downfall of Salomon Brothers (Templeton Foundation)
Published: 2009/04/17
Channel: John Templeton Foundation
BBC reports the collapse of Building 7, 23 minutes before it happened
BBC reports the collapse of Building 7, 23 minutes before it happened
Published: 2012/06/06
Channel: artolivier911
BBC reports Salomon Brothers (WTC7) building colapsed before it colapsed.
BBC reports Salomon Brothers (WTC7) building colapsed before it colapsed.
Published: 2010/08/23
Channel: infontek
BBC says WTC7 collapsed TOO EARLY!! -- part 1 of 3
BBC says WTC7 collapsed TOO EARLY!! -- part 1 of 3
Published: 2007/03/01
Channel: Badger44100
World Trade Center 7 Salomon Brothers Building
World Trade Center 7 Salomon Brothers Building
Published: 2009/09/05
Channel: 777CARL777
Brothers Solomon Opening Credits
Brothers Solomon Opening Credits
Published: 2009/10/17
Channel: Paul Warren
THE SOLOMON BROTHERS אם אין אני לי
THE SOLOMON BROTHERS אם אין אני לי
Published: 2016/03/17
Channel: Solomon Brothers Band
The Brothers Solomon - Playground Scene
The Brothers Solomon - Playground Scene
Published: 2010/09/20
Channel: Brian Sugden
World Trade Center 7 (Solomon Brothers Federal Building) RDX Flashes on 11 Sep 2001
World Trade Center 7 (Solomon Brothers Federal Building) RDX Flashes on 11 Sep 2001
Published: 2013/03/07
Channel: Clifford Anthony Paiva
GD@ Salomon Brothers & Universal Imaging
GD@ Salomon Brothers & Universal Imaging
Published: 2013/04/02
Channel: Greg Deocampo
9/11 - The Birth of Treason - Salomon Brothers WTC 7
9/11 - The Birth of Treason - Salomon Brothers WTC 7
Published: 2012/09/11
Channel: NSBP3 Entertainment
Experts Agree! Stop talking about Salomon Brothers WTC 7
Experts Agree! Stop talking about Salomon Brothers WTC 7
Published: 2016/03/26
Channel: DVincentW
Warren Buffett và bài học về “uy tín” với Salomon Brothers
Warren Buffett và bài học về “uy tín” với Salomon Brothers
Published: 2017/05/15
Channel: Happy Live
WiR vergessen NIE! "Die Mutter aller Lügen" (Salomon Brothers Building "WTC-7" 9/11)
WiR vergessen NIE! "Die Mutter aller Lügen" (Salomon Brothers Building "WTC-7" 9/11)
Published: 2014/11/16
Channel: maldito muchacho
WTC 7 "Pull It"
WTC 7 "Pull It"
Published: 2012/10/01
Channel: Willubhave Four
The Solomon Brothers shemesh ( שי צברי והדג נחש)האחים סלומון שמש
The Solomon Brothers shemesh ( שי צברי והדג נחש)האחים סלומון שמש
Published: 2017/02/06
Channel: Solomon Brothers Band
WTC7 Salomon Brothers building BBC Prophezeiung
WTC7 Salomon Brothers building BBC Prophezeiung
Published: 2017/04/21
Channel: FAKT! NEWS TV
Salomon brothers.
Salomon brothers.
Published: 2017/06/23
Channel: maria khalifa
911 Demolition zoomed view of the Salomon Brothers Building   WTC7   Looking at the the northern face
911 Demolition zoomed view of the Salomon Brothers Building WTC7 Looking at the the northern face
Published: 2010/05/01
Channel: SilentRepublicWTC
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WIKIPEDIA ARTICLE

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Salomon Brothers
Acquired
Industry Financial services
Fate Acquired by Travelers Group in 1998
Successor Salomon Smith Barney (1998-2004), Smith Barney (2003 - 2009), Morgan Stanley Smith Barney (2009-2012), Morgan Stanley Wealth Management (since 2012)
Founded 1910
Founder Arthur Salomon,
Herbert Salomon,
Percy Salomon
Defunct 2003 (name dropped by Citigroup)
Headquarters New York, US
Products Investment banking
Revenue Increase $4.018 billion (June 1997)[1]
Increase $443 million (June 1997)[1]
Number of employees
7,100 (June 1997)[1]

Salomon Brothers was a Wall Street investment bank, known as a bulge bracket company. Founded in 1910 by three brothers (Arthur, Herbert and Percy) along with a clerk named Ben Levy, it remained a partnership until the early 1980s, when it was acquired by the commodity trading firm Phibro Corporation and became Salomon Inc. [2][3] Eventually, Salomon (NYSE:SB) was acquired by Travelers Group in 1998; and, following the latter's merger with Citicorp that same year, Salomon became part of Citigroup. Although the Salomon name carried on as Salomon Smith Barney, which were the investment banking operations of Citigroup, the name was ultimately abandoned in October 2003 after a series of financial scandals that tarnished the bank's reputation.[4]

Recent history[edit]

John Gutfreund became the managing partner in 1978, taking the company public, staying on as CEO.[5] During the 1980s, Salomon was noted for its innovation in the bond market, selling the first mortgage-backed security, a hitherto obscure species of financial instrument created by Ginnie Mae. Shortly thereafter, Salomon purchased home mortgages from thrifts throughout the United States and packaged them into mortgage-backed securities, which it sold to local and international investors. Later, it moved away from traditional investment banking (helping companies raise funds in the capital market and negotiating mergers and acquisitions) to almost exclusively proprietary trading (the buying and selling of stocks, bonds, options, etc. for the profit of the company). Salomon had expertise in fixed income securities and trading based on daily swings in the bond market.[6]

During this period, the upper management became dissatisfied with the firm's performance. Profits were small and the company's traders were paid in a way that was disconnected from true profitability. There were debates as to which direction the firm should head, whether it should prune down its activities to focus on certain areas. For example, the commercial paper business (providing short term day-to-day financing for large companies) was apparently unprofitable, although some in the firm argued that it was a good activity because it kept the company in constant contact with other businesses' key financial personnel.[7]

Finally, the firm decided to imitate Drexel Burnham Lambert, using its investment bankers and its own money to urge companies to restructure or engage in leveraged buyouts. As a result, the firm competed for the leveraged buyout of RJR Nabisco and the leveraged buyout of Revco stores (which ended in failure).[8][9]

At the time of the September 11, 2001, attacks, Salomon Smith Barney was by far the largest tenant in 7 World Trade Center, occupying 1,202,900 sq ft (111,750 m2) (64 percent of the building) which included floors 28–45.[10][11]

1990s treasury bond scandal[edit]

In 1991, US Treasury Deputy Assistant Secretary Mike Basham learned that Salomon trader Paul Mozer had been submitting false bids in an attempt to purchase more treasury bonds than permitted by one buyer during the period between December 1990 and May 1991. Salomon was fined $290 million for this infraction, the largest fine ever levied on an investment bank at the time. The firm was weakened by the scandal, which led to its acquisition by Travelers Group. CEO Gutfreund left the company in August 1991 and a U.S. Securities and Exchange Commission (SEC) settlement resulted in a fine of $100,000 and his being barred from serving as a chief executive of a brokerage firm.[12] The scandal was then documented in the 1993 book Nightmare on Wall Street.

After the acquisition, the parent company (Travelers Group, and later Citigroup) proved culturally averse to the volatile profits and losses caused by proprietary trading, instead preferring slower and more steady growth. Salomon suffered a $100 million loss when it incorrectly positioned itself for the merger of MCI Communications with British Telecom which never occurred. Subsequently, most of its proprietary trading business was disbanded.

The combined investment banking operations became known as "Salomon Smith Barney" and was renamed 7 April 2003 "Citigroup Global Markets Inc." [13] after the reorganization, because the Salomon Brothers and Smith Barney names were a division and service mark of Citigroup Global Markets.

Two members of the Salomon Brothers' bond arbitrage, John Meriwether and Myron Scholes, later became a founder and a consultant for Long-Term Capital Management, a hedge fund that collapsed in 1998.[14]

The firm's top bond traders called themselves "Big Swinging Dicks," and were the inspiration for the book The Bonfire of the Vanities, by Tom Wolfe.[citation needed] Salomon Brothers' success and decline in the 1980s is documented in Michael Lewis' 1989 book, Liar's Poker. Lewis went through Salomon's training program and then became a bond salesman at Salomon Brothers in London. The last years of Salomon Brothers, culminating in its involvement in the Long-Term Capital Management crisis, is chronicled in the 2007 book A Demon of Our Own Design.

Notes[edit]

  1. ^ a b c Travelers Group SEC Form 8-K Filing September 2007
  2. ^ http://www.fundinguniverse.com/company-histories/Salomon-Inc-Company-History.html
  3. ^ Michael Lewis. Liar's Poker. New York, pg 228 https://books.google.com/books?id=Ujl3ngrhduUC&pg=PA228&dq=partnership+salomon+inc+liar%27s+poker&client=safari
  4. ^ Deep Within Citi, the Death of Salomon. Wall Street Journal, September 29, 2009
  5. ^ Michael Lewis, The End, Portfolio.com, 11 November 2008
  6. ^ Sterngold, James (January 10, 1988). "TOO FAR, TOO FAST; Salomon Brothers' John Gutfreund". The New York Times. 
  7. ^ Hojnicki, Carrie (July 3, 2012). "The Spectacular Rise And Fall of Salomon Brothers". Business Insider. 
  8. ^ "History of the RJR Nabisco Takeover". The New York Times. December 2, 1988. 
  9. ^ Eichenwald, Kurt (October 31, 1991). "Rite Aid Seeks to Buy Revco As Salomon Settles Lawsuit". The New York Times. 
  10. ^ Gilsanz, Ramon; Edward M. DePaola; Christopher Marrion; Harold "Bud" Nelson (May 2002). "WTC7 (Chapter 5)". World Trade Center Building Performance Study (PDF). FEMA. Archived (PDF) from the original on March 5, 2008. Retrieved February 17, 2008. 
  11. ^ "Building: 7 World Trade Center". CNN. 2001. Archived from the original on October 13, 2007. Retrieved September 12, 2007. 
  12. ^ Ex-Salomon Chief's Costly Battle, The New York Times, August 19, 1994
  13. ^ [1] changing its name from Salomon Smith Barney Holdings Inc. to Citigroup Global Markets Holdings Inc.
  14. ^ When Genius Failed: The Rise and Fall of Long-Term Capital Management

Further reading[edit]

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