My FT column this week is about Robert Rubin and Citigroup:
In Robert Rubin’s autobiography, he recounts, as Treasury secretary in 1995, trying to persuade President Bill Clinton to back a bail-out of Mexico that might cost $25bn. You mean $25m? someone asked. “No,” said Larry Summers, then an undersecretary, “billion with a B”.
Rescuing an entire country for $25bn seems like a bargain these days, when Citigroup, Mr Rubin’s current employer, has just been bailed out to the tune of $45bn by Hank Paulson, the current Treasury secretary.
Citigroup’s rescue was not only more costly than Mexico’s but has tarnished Mr Rubin’s reputation, which was so high when he left the Treasury in 1999 that he could virtually name his price.
Name it he did: an initial three-year contract with Citi that guaranteed him at least $15m a year, barring “extraordinary circumstances drastically negatively affecting Citigroup operating results”.
Funny, that rainy day is here.
You can read the rest of the column here and comment below.
