Inside Job Transcript - Final Version - 9.30.10 - Sony Pictures Classics

Inside Job transcript – Sony Pictures – September 2010 36
JONATHAN ALPERT: Absolutely does, yeah. I know for a fact that it does. It extends
to the very top.
01:47:36.19
{ALLAN SLOAN
SENIOR EDITOR
FORTUNE MAGAZINE}
ALLAN SLOAN: A friend of mine, who, who's involved in a company that has a big
financial presence, said: Well, it's about time you learned about subprime mortgages.
So he set up a session with his trading desk and me; and, and a techie, who, who did all
this – gets very excited; runs to his computer; pulls up, in about three seconds, this
Goldman Sachs issue of securities.
It was a complete disaster. Borrowers had borrowed, on average, 99.3 percent of the
price of the house. Which means they have no money in the house. If anything goes
wrong, they're gonna walk away from the mortgage.
01:48:11.17 This is not a loan you'd really make, right? You've gotta be crazy.
But somehow, you took 8,000 of these loans; and by the time the guys were done at
Goldman Sachs and the rating agencies, two-thirds of the loans were rated AAA, which
meant they were rated as safe as government securities. It's, it's utterly mad.
01:48:33.18
NARRATOR: Goldman Sachs sold at least 3.1 billion dollars' worth of these toxic CDOs
in the first half of 2006. The CEO of Goldman Sachs at this time was Henry Paulson,
the highest-paid CEO on Wall Street.
01:48:49.19
{MAY 30, 2006}
GEORGE W. BUSH: {COUGH} Good morning, welcome to the White House. I am
pleased to announce that I will nominate Henry Paulson to be the secretary of the
Treasury. He has a lifetime of business experience; he has an intimate knowledge of
financial markets; he has earned a reputation for candor and integrity.
01:49:04.08