Coming up next. Guest host larry doyle. All authorize of in bed with wall street. The guest this week, nomi prins, author of all the president s bankers exploring the multigenerational relationships in the financial and political worlds that are the basis of car and influence in the u. S. Of power and influence in the u. S. The program is about an hour. Welcome. Im pleased to have with me today a wall street insider, renowned journalist, author, and speaker, nomi prins. Having worked at Chase Manhattan Bank here,man brothers, bear stearns, and a managing director at Goldman Sachs, nomi prison s had a distinguished career on wall street and has only distinguished herself further by sharing heir her expertise via the written, spoken word. She had written a number of acclaimed works, including other peoples money, it takes a pillage, and black tuesday. She joins me today to discuss her most recent work all the president s bankers the hidden alliances that drive american powers. Nomi, welcome concluder congratulations on such a fabulous back. As we take a look into washington, wall street, and the families that have had such an enormous impact on our nation and the world. Guest thank you so much, larry thank you. Thank you for the lovely introduction as well. Host my pleasure, very easily done, given the fabulous career you have had, both on wall street and now off wall street in the literary world. So at it really a pleasure to have you. Lets dive right in. This is truly an incredible i would say an unparalleled written history of the relationships between wall street, the large banks that have dominated our nation, and washington. What motivated you to take on such an incredible amount of effort and exercise . Guest a slight bit of insanta, in the amount of time i spend working on it and the intensity. But the novel i had written, black tuesday on the crash of 29, had a scene in it i researched slightly on six bankers that had gotten together at the house of morgan one noon to decide to try and save the markets that were crashing around them in late october 1929 by themselves. And a fellow named tom lamont, the acting chair of the morgan bank at the time, his real chair, jack morgan, was gal vanitying around the elsewhere. Gathered five other bankers together, the most powerful families of bankers running the most powerful banks on wall street, saying we need to do something to save the markets. And they decided with just 20 minutes to throw in 25 million each into a buying pool, tell one of your guys to buy a lot of stock and basically buy themselves, try to boost the market falling around them. I just found that really fascinating, this idea this big six banks. And i noticed today we have six banks and i looked back in time just cursory analysis and there were six banks 100 years ago in the panic of 1097, and they were all largely the same banks. The first part of the century, the same families, now similar legacies. But i started to say, what is that relationship . I was fascinated in other works i had done with the Political Association of bankers, so i decided to look at the history of the period and look at the Real Relationships between six bankers, who are the most important one was at any point in time in our nations history during that century back and their connection tore president , and what i found, because i didnt know that every single president from Teddy Roosevelt through barack obama had strong associations, not always with six key bankers but certainly with a subset at least of six bankers through documents and letters and phone calls and all sorts of other forms of communications as well as social connections through clubs and harvard and other places where they immediate. Host relationships are everything. And whether people want to promote those relationships or not. Lets take a step and go behind the scene. Could you take us into your research. Where did you go . Whom did you meet to unearth some truly incredible material . Guest i decided to good to all of the president ial libraries to make the research very even and always start from the president out, to weather they had associations with particular bankers. So, for every period in time i wanted to make sure id at least had the appropriate historical events that would have occurred at that time. I used to joke with me editor and i would say i just dont want to forget that world war i happened or forget vietnam. So i had an outline of major events that happened, and each president , of course, and treasury secretary, and went to all the president ial archives where the material existed throughout the country, for example, i was at abilene, kansas, in one hot august, working with the archives of president dwight eisenhower, from where i went to independence, missouri to look at the archives of president truman. I started actually in austin with lbj, and went back to austin self times throughout the period of research, because i found that that period very critical in terms of relationships and changing attitudes in america between president s and bankers, citizens and president s and so forth. And i really just dug in deep, and i didnt know what i would find in some cases i had to submit foias, freedom of information acts to unearth certain documents for the more recent president s that had not been unearthed yet. The Reagan Library in california, the archivist really kind of took my project to heart and spent some of her own time really trying to look for documents for me as i was sitting there going through the boxes i had. When you do research they bring out carts and boxes and its almost like a race. Youre going through the bongses. What can i find in through the boxes. And there would be anything, like hari truman, why did are you drop the atomic bomb, from letters from bankers for saying thank you for your support, and him writing back, keep it have done it without you. So all sorts of things you find and you get into this mode of being in that time and that president with those people. Going through just this immense amount of documents and typing it up at night, editing throughout the process, and then going on to the next location and the next president. Were there any libraries that were that you deemed to be somewhat reluctant to share information . Guest well, until reagan actually from fdr through the Reagan Library era, there was a certain code under which everything is classified. Military information, finance information, financial, personal relationships, and its very clear and almost easy to access the information. The carter library, i went there shortly after the film argo came out and there had been a team of argo researchers down there before the movie looking up information about the iran hostage crisis and what happened, and they had this cool rack system where you could go in and look digitally at a lot of documents, not every library has that. But then when some of the more recent libraries the Clinton Library theres little already open and thats because theres an immense amount of information and now you have email and everything needs to good through security clearances and its in a different code. After reagan came in the codes came. A lot harder to find information. The reason i could find it in the Reagan Library is because the archivist had worked at one hoff the prior libraries so new the difference between in the new codes and old codes. But i still have foias outstanding at the Clinton Library, still have foias at the George Bush Library in texas and the george w. Bush library just opened so i didnt have the opportunity to look at anything in there, and obama is in office. Host was there a point in time where the pictures started to or the started to sharpen in terms of the nature of some of these relationships, where it really where you started to realize, wow, this actually goes deeper than perhaps either yourself as well as the public would have imagined, or might even still imagine . Guest yeah. Because i didnt really start at the beginning of the president s, i kind of worked more on geography and flight patterns. I was doing a little jumping back and forth. So for example i would to the lbj library and see his relationship with sidney wineberg, the chairman of Goldman Sachs at the tomorrow, and then be at the fdr larry and see how they had been closed friends because of something lbj said to sidney wineberg, we were both fdr men, so good to have you on me time again. And then when i went to the fdr library to see the beginnings of that relationship. So, a lot of times starting in the middle of history and going backwards allowed me to catch up in the middle and good to the same bankers and see their relationships with all the president s in between. When i saw many instances if you had a relationship with one president , you had a relationship with many. And going back furor further in time i mentioned how tom lamont was the chairman at jp morgan in the crash of 1929. And what i didnt know i found another when i what at the fdr library in hyde park, where i grew up and had gone as a kid he actually had rented out his townhouse on 65th 65th street in manhattan to Thomas Lamont for several years while fdr was the assistant Navy Secretary under Woodrow Wilson. So the tie that happened after the crash and into the Great Depression when fdr was then president , started way back. They had both gone to harvard. They had both been involved with the crimson harvard paper over there tom lamont had actually been one of the editors of the paper when he was at harvard. And they had a very long history, which then lasted through several decades. So, you just kind of there was an onion effect where you just layer and layer and wouldnt be history Going Forward. It was history going backwards and decaded and relationships in between. Host so the relationships really went from not only the business and the political but often into the social as well, then. Guest yeah. Exactly. One of the other bankers, for example, winthrop al dribble who was a yacht0sman, and one of his boats won the world cup. And there was a lot of that going on, and fdr and his sons were interested in that. And so of course jp morgan had a trim yacht at the time, the equivalent of Larry Ellison so there were similar tastes as well that came into play. And so there were social gatherings. Going forward in history, for example insuring 1938, fdr had at this point appointed welsh known name, wellknown family name, Joseph Kennedy to be the first head of the ftc when it was created, and also he appointed million to be uk ambassador in the late 30s after joe kennedy was head of the fcc. So now joe kennedy is off in england, having a gala coming out party, very lovely social event for his daughter, kathleen, who unfortunately died young as part of another kennedy tragedy, but john f. Kennedy, a young john f. Kennedy, was at that event. David rockefeller, who was part of a long history of industrial, financial family strengths, was also there. In fact he somewhat dated Kathleen Kennedy for a minute back at the time. And so the ties, these connections, were went through all sorts of social and events that people wouldnt be involved in. Host not just the social and the individuals but as youre just alluding to, the strength of the families as well. And those family ties that run deep. The morgan, rockefeller, kennedys. Guest the roosevelts, james roosevelt, fdrs father, and jp morgan, the famous and powerful jp morgan,crafted together among a few other established families, the Metropolitan Club in new york, very exclusive club where these men could get together and talk about affairs of the day and decide things, in a very small, tight environment. Host borders on royalty almost. Guest it really was. When you think about it, even the terms today that are used for ascension, the throne, the hierarchy. Terms used i after the panic and after jp morgan got friends together to decide which banks or trust companies could live or die or how much money eached a to pony up to back them up, he was a little afraid, and thought, i dont want to have to do this exercise again. I would prefer a central bank as well. So the bankers who got to this idea of having a central bank to help subsidize or stabilize them so they wouldnt have to put their own money in, whether or not they caused the panic and from a government standpoint, Teddy Roosevelt didnt talk about so it much but when taft came in as president he pushed the idea of having a central bank. And Nelson Aldridge and the Aldridge Family was close to the taft family and basically decided they would do these expeditions into europe and see what was going on with the bank of england and france and see if america couldnt produce something that was more american or have this powerful central bank to bank bankers and the emerging currency going to be the most powerful currency in the world, the dollar. So fast forward a few years of factfinding and traveling around europe, and Nelson Aldridge went with James Stillman quite often, the head of National Citibank, and he got back, and filed documents, and things werent at an official level. Jekyll island happened because it was time to make it official. And jpmorgan said you need to do this somewhat privately, only after Nelson Aldridge was hit bay trolley car on madison avenue. He was in new york, discussing things with bankers, his son lived in new york as well. He got hit on 60th street by the trolley car. So he was convalesced and had been planned to have a big meeting at his estate . Rhode island. But now he is in new york, with the bankers, and morgan has this Club Membership at the Jekyll Island club, and sponsored which is something i found out when i went there myself sponsored this sixpeople, again, to Work Together at in secrecy, away from eyes, to bash out this idea of the fed. The sort of cloak and dagger stuff is a little bit exaggerated. It wasnt like you had paparazzi flying in, and at Jekyll Island its generally at the time it was off the coast and couldnt get there. Couldnt drive there. And there were posts of men watching if boats came in to make sure they couldnt even dock near the Jekyll Island club. So it was a pretty secure place already anyway. And thats where they bashed out the plan, and at the end of them bashing out this plan, nelson goes back to washington to present it to the senate. And what happens was he was still not feeling well from the trolley car situation, and so what occurred was two of the bankers who had been at the meeting, frank vander lift, the number two at National Citibank, and henry davidson, who was one of the Senior Partners at the morgan bank, actually presented the plan to washington, which i did not know eitherring this is something i discovered in the book. So wasnt even the bankers planned this whole thing. They actually went to washington to present the findings. The actual Federal Reserve act that was passed ultimately under Woodrow Wilson looked a little different from that plan, but it had a lot of similar aspects of it. This idea of a central bank. The concession was there would be a new york fed, which would be close and has continued to be close to wall street banks, and then theres the Federal Reserve, which the president would appoint the chairman, and so there was kind of this idea of a balance of power, and everybody was happy and there was a whole bunch of stuff in the book about all the maneuverings at midnight and 1 00 a. M. In the white house until that finally did get passed and signed under wilson. Host clearly the Federal Reserve is a lightning rod, especially currently, giving the easing programs going on. But right from the outset, its always been promoted as an independent institution. In your opinion, can it be independent, given the nature of the relationships as you have laid out . I mean, exquisitely in your book . Guest no. At it naive to think it can be independent. One, because the very structure has member banks within each of the Federal Reserve banks, shares in the Federal Reserve as a entity. So theres an even ownership type of relationship there buttoned that, in the philosophical relationship, the strong one, that started back in Jekyll Islands and has gone through today, its actually benny man strong, one of the guys who has been at Jekyll Island. So got to be head of the new york fed, and paul warberg, another of the men at jecking island, was aopinioned by Woodrow Wilson to be one of the governors of the first Federal Reserve, and from the beginning through world war i. So, from the getgo there was a connection between how it was established, why it was established, and the appointments that were allowed and physically don done by the president and that hasnt changed. Theres never been a suggested appointment thats come through a president that has not been accepted by congress who was supposed to have an extra say in this. Its always been a very slamdunk situation. Larry summers took his name out of the plate and other stuff happened there can but for the most part historically, every time a president wanted someone at the helm of the Federal Reserve it happened, and from the beginning, these people tended to be ban