Open Book with Anthony Scaramucci - The Rise & Fall Of America’s Great Company with William D. Cohan

Episode Date: May 22, 2023

In this episode, Anthony talks with multiple New York Times bestselling author William D. Cohan. William discusses his most personal book yet, Four Friends: Promising Lives Cut Short which tells the tragic stories of four of his school friends, including John F. Kennedy Jr. and Will Daniel, a grandson of President Harry Truman.  He then moves to his acclaimed book, Power Failure: The Rise and Fall of an American Icon, examining what went wrong at General Electric and who was to blame. Finally, William shares what American behemoth he’s investigating next…  Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Hello, I'm Anthony Scaramucci, and this is over. open book where I talk with some of the brightest minds out there about everything surrounding the written word, from authors and historians to figures in entertainment, neuroscientists, political activists, and of course, Wall Street. Sorry, I can't resist. Before we get into today's episode, if you haven't already, please hit follow or subscribe, wherever you get your podcast, and leave us a review. We all love a review, even the bad ones. I want to hear the parts you're enjoying or how we can do better. You know I can roll with the punches. So let me know. Anyways, let's get to it. Now, Bill Cohen has written some great business books. He's one of the

best. I am a big fan and I am lucky enough to call him a friend. In this conversation, however, we go into his most personal book and actually my favorite non-business book of his. The title of the book is For Friends, Promising Lives Cut Short, which is an enormously powerful, tragic read. with great compassion about the lives of four of his friends, including J.F.G. Jr., and President Harry Truman's grandson, Will Daniel. I want to bring this title to people's attention because ultimately it's inspiring. And as I can never resist business, we of course discuss power failure, his new best-selling book on the incredible rise and fall of General Electric. So joining us now is William D. Cohen. He's a multiple New York Times best.

bestselling author. And we can talk about so many different things. But for today, we're going to talk about two of his books. I've read every one of your books, Bill. One of my personal favorites is four friends. So we have to bring that up. Four friends, promising lives cut short, which was a short book, but a brilliant book. And I want to talk about the humanity of that book. And then your recent New York Times bestseller, power failure, the rise and fall on American icon, which of course is the most amazing story about one of our greatest industrial companies, General Electric. And so, first of all, welcome to the show. And it's great to have you on. Great to be here, as always, Anthony, with you. And also, you're writing now for Puck,

where you own your own equity in Puck as a writer, which is super exciting. Where can people find your writing on Puck? Let's start there, and then we'll get into the books. Sure. I mean, Puck.com. News is sort of where you go to read all of the Puck writers. And then you can sign up for our biweekly missives to make sure they sort of come into your email box. Now, it ain't free, Anthony. Oh, I'm a subscriber, brother. I got all of you guys. I bought the whole rainbow of you guys. And it shouldn't be free. The content is so good. You know, you have to pay sometimes. You get what you pay for in life. I want to talk about your career as a backdrop to these books that you've been writing. I think one of the most interesting things about your

career, at least for me, is that you were an investment banker. You worked in financial services for many years. And so not only do you have an outsider's objective journalist window into the industry, you were an insider. I think it was 17 years. Tell us about your career, how you got started and the transition into writing. Well, I had no intention, of course, of being an investment banker. I was a history major in college and wanted to be a journalist because I thought that was the way changed the world. I wrote my thesis in college about the French existentialists and how they changed their circumstances during World War II.

And so they're very activist. And so that made a big impression on me. And the way they did that was Anthony was becoming journalists. So I thought, okay, I will do the same thing. And I thought for sure I would just go to the New York Times of the Wall Street Journal immediately after graduating from college. And believe it or not, that did not happen. And so I had to make my way into the world. But I was a journalist first in upstate New York.

Then I went to Columbia Journalism School. Then I went back to Raleigh, North Carolina, and covered public education in Wake County, North Carolina for two years. won some investigative reporting awards, then decided, okay, for sure now I've got to get to the Wall Street Journal. This will be a no-brainer for the Wall Street Journal. They still wouldn't hire me. My father was pushing me to get my MBA. I didn't really want an MBA. That's not where my head was at, but I thought, well, if I have an MBA and a degree from journalism school and awards, then the Wall Street Journal will hire me, Anthony, and I did that. I got my MBA from Columbia, graduated in 1987. The journal still would not hire me. All you had to do on Wall Street to get a job in May of 87 was to be able to fog a

mirror. And I could do that. Well, that explains my entire career right there. See that I'm a mirror fogger. There you go. That's right. We both are, Anthony. We both came up at the same time. And that's it. I got, I thought, all right, well, if the journal is not going to hire me, I'm not, my journalism career is over. I'm going to go to Wall Street. And, man, I got my first job, you know, of all things, financing leverage buyouts at G. Capital in New York City. Absurd as that was. I'd been, you know, I had no background for that.

No reason they should have hired me, but they did. But you did. But you like it, right? Or you didn't like it? You liked it? Sure. I mean, you know, it was incredibly interesting. I mean, GE Capital was a fascinating place, and a GE was, you know, obviously, you know, and then I wrote this book about it, but back then, you know, it was the hot place to be and leveraged bios. I mean, it was just incredibly exciting. My learning curve was astronomical. And, you know, I'm not saying I was the best investment.

A lot of people that said I was not definitely not. But, you know, I learned a lot from the inside, first about finance and then about M&A advice. and Wall Street politics and, you know, the Wall Street horse race. You know what those things are like. It's not for the faint of heart, that's for sure. Yeah, no, it's a super aggressive place. But I want to take you way back now. You went to Phillips Andover Academy. This is in, it's a suburb in North Boston, I guess.

How far is it from Boston? About 30 minutes by bus. Yeah, but it's north of the city, right? Northwest of the city, yes. northwest of the city it is it wouldn't be mistaken for a suburb of boston though it's uh you know it's near the new hampshire board yeah it's a separate entity it's a separate entity but it's up there i'm trying to i'm set the scene for people that may not know and over as well as you and i do i've been to the campus is absolutely breathtaking uh some of our presidents have been on that campus it is one of the

greatest boarding schools in the history of american boarding schools uh you attended that boarding school. You had four friends that you attended that boarding school with, Jack Berman, Will Daniel, Harry Bull, John F. Kennedy, Jr., obviously the most well-known name of those, but all four of those men, young men, I should say, you got to meet at an early age. So you wrote this book, Four Friends. Why did you write the book about these men? And tell us a little bit about that story and your right of passage as you were growing up and becoming an adult. So, I mean, not to, you know, spoiler, alert, but each of these four men who I knew well, but for a short period of time, obviously the four years, more or less that we were together at Andover, and this was a time, Anthony, before

cell phones, before social media, before it was easy to keep in touch with people, you know, once you were no longer in their physical presence. As I like to say, you know, guys don't write guy's letters that often. So, you know, I knew them well and intensely at that time. And then, you know, we kind of went our separate ways to college, to our early careers, et cetera. And unfortunately, you know, sadly, each of these four guys ended up dying young and tragically. And so, you know, that was something I sort of carried with me for many years. Do you have survivor? Do you have survivors guilt? No, no, because, you know, I had nothing to do with their unfortunate tragic day.

deaths, obviously, but I knew them. They were my friends, and I did know them, and I had more, had lost touch with more or less with some of them, but, you know, I only knew them from that period of time. And so, you know, occasionally I'd run into them, of course. I'd run into JFK Jr., you know, on the streets of Manhattan. But I wanted to know more about them. I wanted to pay homage to them and their lives, their short lives. Why, though? And by the way, There's no way you can spoil this book because I knew the ending of the book. The book is rich with a complex understanding of the human condition. And one thing that you and I both know, and I've actually learned a lot of this from you and it's in this book, there's chance and circumstance

and there's so many things and variables that are outside of your control. You know, you don't pick central Massachusetts as a place of your origin, not saying that you wouldn't. It's a beautiful place and perhaps you had a great childhood, but you, you know, you didn't. and pick it, you landed there from wherever we are all coming in from. Trust me, we had a family motto in the Scaramucci family. Let's keep the word fun and the word dysfunctional. So we had a dysfunctional blue-collar family beating the living daylights out of each other on Webster Avenue. But here you are, and you're writing about this. These guys didn't pick their lives. No. And yet they had this some cases, halos, in some cases, pitchforks. And they had things about their lives that I think

affected them, perhaps led to their tragedies. Do I have that right? You know, obviously, right. I mean, the tragic circumstances in each case were, you know, impossible to foresee or to expect and in many, in many cases, sort of wrong place at the wrong time. The stories are incredible, you know, stories of how they got to end over, the stories of what they did after they left Andover. I mean, but, you know, you could say that John Kennedy Jr. never had a, life. He was the first and only child ever born, you know, into a family that was living at the White House. So he was constantly on display. You know, his life was completely abnormal. He was, you know, obviously incredibly handsome and fun, talk about fun to be with, but, you know, did things that

were, you know, reckless what I came to realize and fully appreciate and piloting a plane that was beyond his capabilities on a very foggy, you know, hazy summer night was probably not the best decision he ever made, obviously the worst. So could that have been foreseen? I mean, possibly, but, you know, I think it just goes to Anthony the fragility of life, which is something we all know deep in our guts and our souls, but we don't like to think about it very much. and I thought I would write this book as a way to get at some of those existential issues of our existence, getting back to, you know, my understanding and appreciation and respect for the French existential philosophers. So it's all kind of a piece, if you will.

I'm going to go over these lives. I won't give up the whole book. I'll go over the lives for a second. You had Jake Berman. He's a child of Holocaust survivors. He's the unfortunate victim of a rampage shooting in San Francisco. Which I might add gave us the 10-year ban on the assault weapons, AK-47s, which expired in 2004, unfortunately, and we're still living, you know, 20 years later with the after effects of letting that law expire and that ban expire. Right.

And we both know that over that 10-year ban, these mass shootings and the fatalities associated with them. Well, but from 94 to 04, the fatalities went down. I mean, so we do know we can prevent these. We can reduce mortalities and fatalities. So why we're allowing this to persist on literally a daily basis is the American. It's unconscionable. To me, it's one of the greatest frustrations of our current political system that they have such indifference of this. You know, Will Daniel, a grandson of President Harry Truman, he meets his demise by getting hit by a taxi cab on Park Avenue.

Yeah, I mean, Will was a brief. brilliant guy who was very conflicted about his upbringing. Not only was he a grandson of Harry Truman, his mother was Margaret Truman, Daniel. His father was managing it for the New York Times, Clifton Daniel. This is a guy who, you know, Will could have done anything he wanted. He was very conflicted about his family and his privilege and was a bit of a lost soul, you know, even into his 40s. had been, you know, returning from a party at like two in the morning that he'd gone to in Brooklyn going back to his mother's apartment on Park Avenue when, you know, he crossed the street at two

in the morning and got hit by a cab, you know, very, very sad. And a waste of, of great intelligence and great... A little key guy the way you describe him, though. You know, he didn't thrust his background or who he was in. anybody's face, really, right? Never. Unlike John Kennedy, JFK Jr., couldn't get away from it, right?

Couldn't avoid it. Couldn't avoid it. Nobody knew that Will Daniels was Quifton Daniel's son or Harry Truman's grandson. Right. You know, Harry Ball, he's the heir to his family's great fortune. He drowns with his two daughters on a sailing trip to Lake Michigan. No, I mean, that's like the saddest thing you could possibly ever imagine. It just, you know, and, you know, I interviewed.

feud is so a widow who I didn't really know. And just can you imagine, even though the events had happened, you know, 20, 18 or 20 years earlier, you know, sitting and talking to her in her Chicago suburban home and hearing her, you know, hearing her relive the stories and seeing the shrine that she had sort of built to him in the basement. I mean, it was incredibly moving and powerful and just shocking. and tragic. Yeah, and again, young and, you know, it's just one of these things. So, you know, you and I, obviously, we're reasonably well read.

We read Sophocles and Escalis and all these tragic stories. And then, of course, we're faced with these in our life, right? Because this is this short life with mortality around us and our own mortality. Let's go to Jack Kennedy's son, John F. Kennedy, Jr. We had Carol Radzwell on to talk about her book a few weeks ago. as you remember, she was married to Anthony Razuel, who died of testicular cancer three weeks after John. Of course, nobody was expecting John to die. He was a very healthy, vigorous guy. But Anthony was stricken with cancer for a decade. But, you know, he's an iconic figure to me. You know, I remember him, and he's a couple years older than me, but I remember him being on the cover of People magazine bill. And he was the sexiest man alive. He was a couple years older than me. And let's just face it, he was a, he was a chick magnet. Okay, we'll just call it that. I know if you're allowed to do that anymore due to political correctness, but he was. Tell us a little about him. Tell us a little about your

interaction with him, your feelings towards him. Well, you know, I, he was a junior in Andover, what we used to call uppers. When I was a senior, I was one of his blue key advisors. He was in my dorm. The reason he was in my dorm is because my dorm was next to the Andover Inn. He said, he still had Secret Service protection at that time, being under 16 during part of that time. And so the Secret Service was in the Andover Inn next door, you know, to try to provide a, you know, a sense of quote-unquote security for John. And so he was in my dormant. We just became friendly. You know, everybody sort of wanted to be, you know, around him, just magnetic, you know, physically and personality-wise, just a lot of fun. And yeah, everybody, you know, he was, I mean,

an unbelievable draw for people. And so, I mean, we just became friendly through that year and a little bit afterwards. And I mean, of all the people, obviously, he's the one we all feel like we know ever since saluting his father's coffin, knowing he's three years old. You know, that is one of those iconic images in American history and the tragedy of that. You know, he would invite me occasionally over to his apartment on Fifth Avenue and meet his mother. And, you know, and of course, being from Massachusetts, you know, the Kennedy name was, you know, akin to papal supremacy. I mean, it was in extraordinary. I mean, listen, it was America. I mean, look, I mean, it was American royalty. I mean, even for a blue collar kids in Port Washington on Long Island. I mean, the Kennedys had. I mean, the

Kennedy's had a glamour. They had a glitz to them, but they also had a reality in terms of the way they held themselves. They were good-looking people. And, you know, John Kennedy was quite charismatic and thoughtful in terms of what he was trying to do as the American president. And, you know, what happens with tragedy, though, Bill? You're a great writer, but tragedy has a tendency to magnify things. Doesn't it tragedy has a tendency to increase the intensity of our emotional experience to the story, right? Happy endings are great, but tragedy, there's a pathos to it that sort of tugs at our heartstrings. Am I, am I right? Well, you're absolutely right. And I think tragedy allows us to learn more than happy endings do. I know happy endings are very useful for places like Disney

animation, but tragedy helps us learn who we are as people and the reality of our circumstances as human beings, the finite nature of our existence. And they say that nothing focuses the mind at night like, you know, an execution in the morning, Anthony. And we're all sort of facing our own demise. No one gets out alive. And I think that fact alone adds a certain sense of urgency. especially as you get older to your life. And again, going back to the existential philosophers who preached this idea of living every day of your life as though it would be your last,

that's a very hard thing to do in practice, if that were the case, I'd be eating macaroni and cheese all day long because that's going to be my final meal if I can manage it. And so you just have to do the best you can. And that's sort of how I think about, you know, my life is a writer now too, is trying to kind of do as much as I can because, you know, I wasn't meant to be a writer. Nobody wanted me to be a writer. My teacher at Andover, I went back in writing this book, Anthony, and got all of my teacher reports and housemaster reports about my

existence at Andover during those four years, which was quite eye-opening, I must say. And one of them was from my English competence teacher in ninth grade who basically said, you're a terrible writer, you're a lousy writer. I hope you're not ever thinking about becoming a writer because that will be a majorly dead end for you. So nobody wanted me to do this. And I wasn't, if I hadn't been fired by J.B. Morgan Chase in 2004, I'd probably still be an investment banker. So I see this as sort of a blessing and I take advantage of it all day, every day, and that's why I write as much as I try to and write long, big books. Well, I love the book.

I mean, I guess because we're contemporaries, and there was something in that book that made me realize our fatality more than I typically do. Maybe we're both getting older. I don't know, but it just made me think about, you know, we're here. I took my wife, Djerger, to the Acropolis a few weeks ago. we were up at the Parthadon, and I was walking the Parthenon thinking of Pericles. He was there 2,500 years ago, and so you think it's a long time ago, Bill, but if you think in generations, it's only 100 people are separating us from Pericles, because each generation

is 25 years. And so when you think about it that way, there's really just 100 generations between us and Pericles, and yet they're long gone. The Acropolis is barely standing when you look at it, and will be long gone. And as the Greeks would say, even the stars have a beginning and an end. And so we have to accept that. And I do think it brightens our life weirdly for some of us. Maybe some of us get depressed over it.

But a lot of us, it brightens our life. It makes our life almost more exciting to live. It makes our life more vibrant. The colors are more vivid. But I appreciate you writing this book. I wanted to talk about it today and recommended the people for friends, promising lives cut short because there's so much richness to the book about our humanity. I'm going to switch subjects abruptly to something.

you're really good at, Bill, which is writing about business and writing about the characters in business. I was first introduced to your writing when you wrote the book about Bear Stearns, which I thought was an amazing book. Did you win the FT Business Book Award for that one? You won it for one of them. I was one of my first book about Lizard. Okay, yeah, I read that as well. I read the Bear Stearns book first. Then I had to go back and read the Lizard book. And then, of course, I read the Goldman book and so on. But let's go to Power failure. You're writing about this company, which has been in our lives for, let's call it the modern era of America. General Electric has been with us the whole time. Tell us about it.

The economist said it was one of the best books in 2022, New York Times bestseller. Tell us about it. Why write it? What do we don't know about GE that you think we need to know? Well, as you said, Anthony, it's an iconic company founded in 1890, in part, through a merger. It was founded through a merger of Thomas Edison's company, along with another company that was owned and run by a guy named Charles Coffin, who became the first CEO of GE. GE has mythologized Thomas Edison in its DNA, and he certainly formed one of the two strands of the DNA, but he didn't. want the merger. It was forced upon him by the big-time bankers at that time, a guy named J.P. Morgan and another guy named Henry Ballard, who was the CEO of Edison's company and had been a train, a railroad mogul. And then the venture capitalists in Boston that were backing a coffins company.

So, I mean, right from the get-go, Anthony, you've got sort of this M&A overlay, this moneyman overlay that created this company and made it a dominant force. In America, in life. And, you know, you have this incredible history of the company led by, you know, these quote unquote great men leading up to Jack Welch. And one of the things that I really sort of have taken to heart, you know, Charles de Gaulle once said that graveyards are filled with indispensable men. And, you know, I always think about that. And it not only does it tie into my four friends book, but, you know, even my book about, you know, Lizarre, when I was at Lazzard, I mean, you know, Felix Rowden and Michelle David Vey were ruling the ruse.

Now they're both, you know, in the graveyards. And they seem so powerful and so compelling. And, you know, we lived sort of in fear of them. And so, you know, Jack Welch is now passed, even though, you know, I was fortunate enough to spend many hours with him interviewing him about his life and what he was trying to do at GE and what he accomplished at GE and what some failures were that led to the company's downfall. And so I just thought it was this incredible story, Anthony, of the rise and fall of one of the great American companies, one that helped define the era of American capitalism in the 20th century. And just to show you how, again, fleeting things are, even though you think they'll be around forever.

I mean, Joseph Schumpeter, the Austrian economist, talks about creative destructionism. And, you know, the seeds probably of GE's both rise and its fall were implanted, you know, right from the start in 1892. And I found that just fascinating and riveting. And I thought it was having worked there, having worked at GE Capital, having, believe it or not, my office made at GE Capital, I was a guy named John Flannery who went on to succeed Jeff Imold for 15 months, sadly, as the CEO of GE. It just became one of these stories. I couldn't resist writing. You know, the reason I'm smiling, you're listening to you talk, is that, you know, GE,

I was at a speech, Allen and Company at the Sun Valley Conference year 2000. Warren Buffett gave a speech about the ephemeral nature of corporations. And he basically said that take a look at this list and nobody recognized the list. He said, okay, well, that was the Dow in 1900. It's 100 years later now, 2000. And there was one name on the list that we all recognized, which was General Electric. Of course, Buffett pointed out that it was taken out of the Dow temporarily in the 20s, put back into the Dow. And he was making the case that there's been no company since the origination of the Dow 30 stocks. It's actually stayed in the Dow 30. It's had been a constant circulation as times changed and corporations change. But what happens? Is it like an empire? Is it like a family? You know, the expression, your shirt sleeves to shirt sleeves in three generations. Is it a cultural thing? Is it a circumstantial? Do we personalize? things that are situational? Does technology change? Or do you think it was something devastatingly

flawed about general electric culture? Well, I mean, I think there was an aspect to all of what you just mentioned that resulted in the downfall of the company, which is now being split up and never more. Look, I think part of it is that the age, the great age of conglomerates is over. You know, so once upon a time, you know, investors loved conglomerates. Now they don't love conglomerates. And so I think the support wasn't there from the investor community. But the real catalyst for the downfall, I think that the GE, because it was so iconic, and because it was in many ways a combination of Apple and Microsoft and Google, you know,

rolled up into one for a very long time, it was an amazing technological leader in this country. for a very long time and still is an important technological leader. But what I think none of us really fully appreciated, although I did since I worked there, was that GE, in addition to being, you know, a leading manufacturer of, you know, healthcare equipment and jet engines and power electricity generating plants, et cetera, et cetera, on and on and on, was that it was a very large non-bank bank bank. It was a very large, unregulated, financial institution that relied on the short-term financing markets, the commercial paper markets for a lot of its capital. And then it did the exact same thing, Anthony, that we just saw

in spades with Silicon Valley Bank. It borrowed short and lent long, the classic mistake of lending institutions and financial institutions. And I think that while Jack Welch, who really created, I mean, it was around before Jack, obviously, but he really exploited the opportunity, the financial opportunity that GE Capital presented to GE. He literally got off on arbitraging GE's AAA credit rating, its ability to borrow money very cheaply just above treasuries, and then lending it out and making a lot of money on lending it out and being expensive, too. You know, we used to get warrants, stock in the deals that we financed,

just like Mike Milken did at Drexelberm. And, you know, he told me that it was a lot easier to make money for money than it was to make money bending metal into, you know, an aircraft engine. And, of course, he was absolutely right. And it became something like 50% of G's profits. The problem became, of course, like it did across the spectrum in 2007 and 2008, is that while I think Jack understood the risks at G capital, and had people like Gary Went and Dennis Naden in charge of GE Capital,

who really understood what risk-taking was all about. Jeff Nimell was a different animal. He was more of a marketing guy. I don't think he really, in his heart of hearts, understood the risks that were lurking at GE Capital, especially when the shit hit the fan, as it did across the board in 2007 and 2008. And that's what became the catalyst for the downfall of GE.

people, you know, were focused on the Wall Street banks in 2008, as they rightly should have been, and on the car companies and on the big insurance companies like AIG. Most people don't even realize that GE almost went down the tubes. GE Capital almost filed for bankruptcy twice. And if Jeff Immelt hadn't gone to Hank Paulson and Sheila Baer at the FDIC and begged for a bailout, GE was not part of the tarp. They had to beg for a special situation. out access to financial lines that the Fed and the Treasury are making available.

They got Buffett to make an investment as well, right? They got Buffett to make an investment, just like he did it in Goldman Sachs and in Bank of America. Of course, paying a Warren made a ton of money on that investment. They raised capital from the public as a result of Warren's investment, just like Goldman Sachs was able to do. So, you know, to Warren's credit, he sees great companies in distress and knows what to do and takes chances when others won't. But that led to a, you know, a series of situations that ultimately resulted in the downfall of the company, which I document, you know, in the book. And it's, it's just an incredible story of how important it is, Anthony, and you know

this. The choice of the CEO is incredibly important. And one of the tragedies of GE is, of course, Jack, Welch, who was so successful, you know, the manager of the century who took over GE when it was worth $12 billion and made it worth $650 billion, you know, had a very public succession process two years on the front page of the Wall Street Journal every other week and chose Jeff Immelt. And the first thing out of his mouth when I sat down with him and then Antugget Country Club in August of whatever it was 2018 was, you know, I fucked up. He literally said that to me. I fucked up and I chose the wrong guy to be my successor. And, you know, there are consequences for those decisions.

Could Jack Welch have kept that company together? No, I get asked this, you know, a lot. And it's one of those hypotheticals we'll never know the answer to. But I believe Jack understood better than Jeff, the risks that were embedded at GE Capital. I believe that Jack got rid of Gary went because he thought Gary, you know, was too ambitious and embarrassed the company with his divorce. Of course, Jack embarrassed the company with his divorces, but put that aside. Jack was a big Dennis Nadin fan.

Jeff was not a big Dennis Nadin fan, got rid of Dennis Nadin. And I think that Jack would have listened. You know, there are people warning Jeff Immolt about the risks embedded at G Capital long before the 2008 financial crisis. People like Bill Gross, the Bond King, people that Jeff Immolt should have been listening to people like Jim Grant, the incredible writer and editor of Grant's Interest Rate Observer, you know, Jim Grant is one of my heroes, and he'd been warning Jeff Immelt at G. Capital for years. Other hedge funds had been warning Jeff Immold for years about the problems

embedded at G. Capital, the whole borrowing short and lending long problem. And basically, Jeff ignored them until he couldn't ignore them anymore, you know, in September of 2008. Yeah, well, I mean, listen, you know, I read Jeff's book. I think you had the opportunity to interview, Jeff, right? You interviewed him, right? Brown and read his book, yes. Yeah. Yeah. So, I mean, listen, I mean, you know, some of it, you know, you get caught up in things. You know, you get blindsided by certain things. You know, I've made mistakes in my career. I went to go work for Donald Trump. I didn't see the full on malevolence there. Other people are, well, chastise me for that. That's fine. I accept the criticism, but at least I'm able to own it. I think one problem that people have in those positions, they have hard time owning or being accountable for the mistakes that they're making. And I think the reason your books are so well done is that you elicidavit. what people do right and wrong. And it helps you fast track the learning curve, if you will, Bill. You know, the more self-aware you are, the more you can acknowledge your frailty, the better off your career arc is going to be, but also your mental health. And so there's so many reasons why

I love your books, but those are some of the main ones. You're an M&A guy. Jack Welch reformed. Former former M&A guy. Jack Welch made a thousand deals in 20 years. It's just sort of unbelievable. Did that make the company too big? Well, you know, in part, I mean, he was buying companies and selling companies all the time. I mean, basically he and Larry Bossidy were like the original LBO guys. I mean, they were like their own corporate LBO firm, buying and selling companies, you know, all the time. It did make the company very big, but it also, you know, created a tremendous amount of shareholder value. So, I mean, it's hard to necessarily criticize that.

you know, when Jeff took over, he got out of businesses that he didn't like, that he didn't think were right for GE, and he tried to focus it down on what he thought was important. And, you know, again, that gets back to the importance of the choice of a CEO. And, you know, because the CEO is the one in charge, as he should be. And to your point, I do think it's hard. It's hard along the way. In fairness to Jeff, it's hard along the way. He's, you know, he's an honest guy, he's an honorable guy, tried to do the right thing. things. He thought, you know, what he was doing, he thought was right. And again, getting back to the importance of the choice of the CEO, because that's the strategic direction of the company is set by the CEO and, you know, whether to go forward with a acquisition, even if the price is getting too high or not going forward, all those decisions are made by the CEO. The board has the illusion of authority over the CEO, but I think it's more of an illusion than anything else. Although, you know, necessary the board can make the tough decisions to get to get rid of a CEO, which they did in Jeff's case. But it's hard along the way to realize to come to the conclusion that the things

you are doing incrementally on a daily basis are putting the whole company at risk on an existential basis. And so I know that's hard to do, but you know, you really have to be very willing to listen to people who don't agree with you and hear their point of view, especially when they work for you and you're paying them a lot. And I think that Jack was much better at that than Jeff was. And I think that became also a fatal flaw for Jeff. So fascinating. So Bill, I have five words or statements and I want you to react to them sort of like in a quick fire fashion. Okay, you ready? Yes, lightning round time. Okay, ready? Lightning round time. Yeah. Duke University. I love the place. I wish it loved me as much as I loved it. I wrote a book about the Duke lacrosse

a scandal that they kind of can't forgive me for, although I don't know why. I'm very proud to have gone there, proud to be associated with that place. Yeah, I was asked to resign from the Tufts Fletcher School of Law and Diplomacy because 26 students didn't like the fact that I worked for Donald Trump. And so the president, Tony Monaco said, bye, bye. I said, okay, no problem. So I left. Yeah, I got it.

So I have that same strained relationship with my alma mater. Bear Stearns. I mean, what an incredible story. the most incredible story for a firm that had been around for 85 years was so iconoclastic, so unique on Wall Street, so many interesting characters to disappear in a week and how that happened. You know, that's just one of the most incredible stories in Wall Street history. And I, you know, competed against Bear Stearns. I almost went to work there. I have a lot of friends who worked there. To be able to write that story, Anthony, to be able to interview the people,

who were, you know, intimately involved with what happened there was one of the great privileges of my life. Yeah, it was a great, it's an amazing book. Lassard Frere. Well, I mean, Lassard, I mean, I always, I'm in a big Francophile. You know, I went on my honeymoon to Paris. I studied, you know, as I think I've alluded to it several times now, the French existential philosophers in the original French, which meant that I got about 5% of what they were saying

until I read them in English. I've been a Francophile. I love France. love France. I'm proud to say that. Me too. There are our oldest friends, Bill, the French, you know, and we have our differences, but say la Vie, as they say, right? We can still love each other

and have our differences. I always wanted to work there because I got it in my head that that's where I wanted to work. It was mysterious. They didn't, they didn't recruit on campus. They didn't recruit MBA. I was the only associate hired in the year I was hired in 1989. I recount the story of how I got hired in the book, which was kind of a fluke. It was incredibly strange place to work, but the characters running around there were unbelievable.

Again, another privilege to be able to interview all those people. They don't like me either, Anthony, the people who run a firm now. You know, you're an iconical. Bill, nonconformists are generally disliked by conformists, right? I mean, just the nature of the beast. You can live a great life, have your intellectual thoughts, independent freedom, or you can be liked, make a decision. You know, I decided that I'm going to go renegate, go rogue, build my own career, my own conference. That's my own, Anthony. Yeah, yeah. Herrists said the same thing so well the other

day she articulated this too. Right. Well, this is why I respect her and she's, uh, she's always welcome on my show and vice versa. I mean, my, my thing is we have to, we have to be that way for our kids. I believe that. I've got five children. I want to show them that there's a way they can live where they can actualize a level of their personality. And believe me, I've, got my faults and they've been on stage. My faults have been parodied on Saturday Night Live, but that's life. I'm taking the risk and I'm willing to deal with the consequences. My last one, ready? Wall Street, Wall Street, Bill. You know, a book that I wrote that doesn't get much attention called Why Wall Street Matters. It's a very thin volume. I remember that one as well.

Yeah, it's a short book. It's a lot like four friends. It's a smaller book than your usual ones. And I recommend it to anybody who's thinking about working on Wall Street, if you can find it. Look, Wall Street is an essential part of the world economy. The whole world has gone capitalist, Anthony. It's not even a question anymore. And Wall Street is the left ventricle of capitalism. You have to understand how it works. I feel like I'm privileged that I understand how it works.

I feel like my mission in life is to translate how it works for those people who don't understand it and think they'll never understand it. So I write in layman's terms. I tell stories about what it's like there, where it's going, what it does right, what it does wrong, and how it evolves and how it continues to evolve and how regulation affects it and how Washington, you know, this symbiotic, often lecherous relationship between Washington and Wall Street. This is my mission now. Well, yeah, and listen, we've got to keep it going. We've got to get our regulators to think about it appropriately, not over-regulated, and we've got to get our players on Wall Street to be a little less gecko-like in terms of their greed. And we can get that right.

It's a great arterial system for capitalism. What's next for you, Bill? Are you able to talk about anything that you're working on right now? Yeah, why don't I announce, Anthony, on your show? Okay, great. Make a little bit of news. My next book is going to be about Apollo, the private equity behem. Yes, you were.

Wow, you got a lot to talk about there. New friends for you, Coe. I mean, new friends for you. Yeah. The Apollo partners are all going to become your best friends as a result of your honest, objective expose of their business. And not only sort of the amazing story of the firm, which is interesting in its own right, but I'm a sort of big believer in Wayne Gretzky's adage that you have to skate to where

the puck is going to be, Anthony. And Apollo is skating to where the puck is going to be on Wall Street and finance and is literally transforming a Wall Street in front of our eyes. And I don't think people appreciate that fully what firms like Blackstone and Apollo and KKR are up to these days. You know, people think of Apollo as a private equity firm, right? But of its 550 billion of assets, something like 400 billion are in private debt. these companies are becoming on their unregulated huge alternative asset behemoth and gold blackstone's market cap is the same as golden sax is now so goldman sax is highly regulated blackstone is highly unregulated not on completely unregulated obviously public company cc regulation but not to the same extent that you know a ciffy bank is so places like apollo are where finance is going where where it's headed

So I'm going to follow that puck and hopefully right into the goal, Anthony. Yeah, I love it. Yeah, I'm looking forward to the book on Apollo. I'll be buying it. I've got to encourage you to come back on the podcast. I want to read it and then talk about it with you. You got a few years before that thing emerges. All right.

Well, there you go. Okay, well, I can assure you that my hair won't be gray then, Bill, because I have a gray colorist. That's primarily the reason why. You do. I'm very impressed. Yeah, listen, you got to, you know, look, you think I'm using Rudy. Giuliani's colorers, Bill, come on. No. Okay. This is not self-inflicted hair dye. This is done by a union beautician, okay? And you're not using Donald Trump's hair dye either, so. Right. Thank God. You know,

we don't want it to look orange. No. Bill, thank you so much for joining us. The two books that we highlighted today, four friends, promising lives cut short and power failure. A recent New York Times bestseller, best business book of the year by The Economist, Financial Times Best Book of of 2022, New Yorker, Best Books of 2022, Power Failure, The Rise and Fall of an American icon, the Story of General Electric. Thank you, Anthony. Always a pleasure to be with you. As Bill said, and I often repeat a line from Mel Brooks about relaxing, none of us get out of here alive. I think Bill wrote this amazing book about his friends whose lives were cut short for various reasons. Some of them had to do with their family, some of it had to do with their risk

taking. But by and large, it was a group of people that had great potential. And yet as Bill and I sit here 20 years, and in some cases 25 years after the deaths of some of his friends, we have sadness because we realize how much of their life and all of these great things that we've been able to experience in our lives that they've missed. Of course, none of us can predict our future or what our fate is. But what I loved reading in Bill's book was the compassion. What I loved reading was the stoicism. And so unfortunately, we can't interview Marcus Aurelius, the great Roman general that wrote the book Meditations. But we have great writers like Bill that we can interview that capture the same spirit of understanding the fragile nature of life, the fragile nature

of the human condition. And no matter what our riches are, our family lineage, the different privileges that we've been born with in this life, we are all given our set of problems. We have to witness our own demise. We have to witness the demise of our friends and loved ones. And of course, as Freud said, this makes us at times hysterical because we're the only animal on the planet that, I mean, maybe the elephants to some extent, we're not sure, but we're the only animal on the planet that recognizes its own death. And so with it comes a lot of hysteria and unfortunate sadness. So love that book. I encourage people to read it. It's a great philosophical, earthy anchoring to the importance and the meaning in life. And, you know, listen,

that was a phenomenal book. Power failure, another great read, much longer book. Jack Welch, well, I mean, what a character. I frankly didn't go into the Ken Langone interviews with Bill. I'm going to pat myself on the back here for a moment, if you don't mind. I introduced Ken to Bill. Ken is typically skeptical of journalists. He's now gone on to become a very close friend of Bill Cohen. And I've got to tell you, the interviews in power failure between Langone and Bill Cohen are enjoyable. You will laugh out loud if you decide to read the book. So I don't want to miss that treat in my closing remarks. But if you enjoyed this chat with Bill, then make sure you read his other books.

I'll be holding tight for his next book on Apollo Management, the legendary private equity firm. I had Bill Cohen on. He's a very famous author. And he wrote about four of his friends that, died tragically, he went to high school with them, but they all died around the age of 40, including JFK Jr. You remember when JFK Jr.? Jack Kennedy's son, Jackie Kennedy's son, died in the plane crash? Yes, of course.

What do you think about people that are coming from money? They have a lot of pressure on them. You know, one of the kids that died was the grandson of Harry Truman, President Harry Truman. Another one was the inheritor of great wealth. What do you think happens to people that have this type of pressure on them? coming from families that have these high profiles. It depends on how the person that has the high profile treats their children, which I don't think you'll ever have that, because you treat everyone equal, including your children.

When you have five children, and I know for sure that you have all five of your children equally as well. And I think that's another gift that you have. I sound like I'm wacky, but I don't think you have very many faults. I don't see any fault in your personality. All right. All right. You're very sweet to me, Ma. You know, I love you too. All right. Let me ask you this. You remember Jack Welch from General Electric? Yeah. What'd you think of him? I never really read about him or anything, so I can't really give you an opinion. What did he do?

No, but he was a very famous guy, but he ran the business very tight. Some people are critical of him because he pushed too hard on the accounting, but I liked him. And I remember the day you got your first washer and dryer. They were both General Electric. That was good, right? I used to enhance General Electric. When I was young, first of all, it was good for the average person. But I don't know. My father was a hiker in his day, and he had many, many businesses. And I was raised very, very spoiled. And I have a son like you who have spoiled me immensely.

And I can't thank you enough. That's how I feel. I am Anthony Scaramucci, and that was open book. Thank you for listening. If you like what you hear, tell your friends and make sure you hit follow or subscribe wherever you listen to your podcast. While you're there, please leave us a rating or review. If you want to connect with me or chat more about the discussions, it's at Scaramucci on Twitter or Instagram. You can also text me at Plus 1, 917, 909-29-9-9-6.

I'd love to hear from you. I'll see you back here next week.