Ace Greenberg: Frog and Toad Are Friends at Bear Stearns

This seems like something out of a children’s book, but read/watch this Bloomberg Television clip on for how Bear Stearns managed risk in the bygone days of having Ace Greenberg at the helm.

We had 3 people who worked for us. We had Cy the Spy, one was called the ferret, and one was called, I think the weasel. And their job was to walk around without any notice, sit down with a trader and look at his book and query him. So constantly we were on guard against the one thing that could cause you into so much trouble, and that’s an employee burying trades, having something that went bad and not disclosing it, and of course it gets worse and he tries to cover up and then you have a loss of a billion dollars or in one case 7 billion dollars.  Which you probably read about a few years ago.  So that was always my big fear and we were particularly rough about that. And any trader that didn’t want to cooperate with those three people, I said “you’ll make my day, just let know about that.”