By Bradley Keoun & Phil Kuntz -
Aug 22, 2011 8:19 AM ET
Citigroup Inc. (C) and
Bank of America
Corp. (BAC) were the reigning champions of finance in 2006 as home
prices peaked, leading the 10 biggest U.S. banks and brokerage
firms to their best year ever with $104 billion of profits.
By 2008, the housing market’s collapse forced those
companies to take more than six times as much, $669 billion, in
emergency loans from the U.S.
Federal Reserve. The loans dwarfed
the $160 billion in public bailouts the top 10 got from the U.S.
Treasury, yet
until now the full amounts have remained secret.
Chief executive officers from
eight of the largest U.S. banks receiving government aid testify at a
House Financial Services Committee hearing in Washington, D.C on Feb.
11, 2009. Photographer: Brendan Smialowski/Bloomberg
Aug. 22 (Bloomberg) -- The
Federal Reserve's unprecedented effort to keep the economy from plunging
into depression included lending banks and other companies as much as
$1.2 trillion of public money.
The largest borrower, Morgan Stanley, got as much as $107.3
billion, while Citigroup Inc. took $99.5 billion and Bank of America
Corp. $91.4 billion, according to a Bloomberg News compilation of data
obtained through Freedom of Information Act requests, months of
litigation and an act of Congress. Erik Schatzker and Sara Eisen report
on Bloomberg Television's "InsideTrack." (Source: Bloomberg)
Aug. 22 (Bloomberg) --
Robert Eisenbeis, chief monetary economist at Cumberland Advisors Inc.,
talks about $1.2 trillion of public money the U.S. Federal Reserve
secretly loaned to Wall Street banks and other companies.
Eisenbeis, speaking with Mark Crumpton on Bloomberg Television's
"Bottom Line," also discusses the outlook for Fed monetary policy and
the U.S. economy. (Source: Bloomberg)
Aug. 21 (Bloomberg) --
Robert E. Litan, a former Justice Department official who in the 1990s
served on a commission probing the causes of the savings and loan
crisis, now vice president at the Kansas City, Missouri-based Kauffman
Foundation, Richard Herring, a finance professor at the University of
Pennsylvania, Roger Lister, a former Fed economist who’s now head of
financial-institutions coverage at credit-rating firm DBRS Inc., and
Kenneth Rogoff, a former chief economist at the International Monetary
Fund and now an economics professor at Harvard University, talk about
the U.S. government's $1.2 trillion bailout of the banking system and
the outlook for regulatory overhaul of the industry. (Source: Bloomberg)
Aug. 22 (Bloomberg) -- Neil
Barofsky, former special inspector general for the Troubled Asset Relief
Program and a Bloomberg Television contributing editor, talks about the
Federal Reserve's emergency loans during the financial crisis.
Fed Chairman Ben S. Bernanke’s effort to keep the economy from
plunging into depression included lending banks and other companies as
much as $1.2 trillion of public money, according to a Bloomberg News
compilation of data obtained through Freedom of Information Act
requests, months of litigation and an act of Congress. Barofsky speaks
with Erik Schatzker on Bloomberg Television's "InsideTrack." (Source:
Bloomberg)
Aug. 22 (Bloomberg) --
Charles Peabody, an analyst at Portales Partners LLC, and Bloomberg
reporter Bradley Keoun discuss the Federal Reserve's emergency lending
programs and the capital position of U.S. banks.
They speak with Erik Schatzker and Michael McKee on Bloomberg
Television's "InsideTrack." (Source: Bloomberg)
To view the Bloomberg interactive
graphic of the Fed's financial bailout, click on the link in the
seventh paragraph of the story. Source: Bloomberg
Citigroup Inc. and Bank of
America Corp. were the reigning champions of finance in 2006 as home
prices peaked, leading the 10 biggest U.S. banks and brokerage firms to
their best year ever with $104 billion of profits. Source: Bloomberg
Lloyd Blankfein, CEO of Goldman
Sachs; Jamie Dimon, CEO of JPMorgan Chase and Co.; Robert P.Kelly, CEO
of the Bank of New York; Ken Lewis, CEO of the Bank of America; Ronald
E. Logue, CEO of State Street; John Mack, CEO of Morgan Stanley; Vikram
Pandit, CEO of Citigroup; and John Stumpf, CEO of Wells Fargo, testify
during the House Financial Services oversight hearing of the Troubled
Assets Relief Program (TARP). Photographer: Scott J.
Ferrell/Congressional Quarterly/Getty Images
Two weeks after Lehman Brothers
Holdings Inc.'s bankruptcy triggered a global credit crisis, Morgan
Stanley countered concerns that it might be next to go by announcing it
had 'strong capital and liquidity positions.' Photographer: Jeremy
Bales/Bloomberg
A Wall Street sign stands outside
the New York Stock Exchange in New York, U.S. The loans dwarfed the
$160 billion in public bailouts the top 10 got from the U.S. Treasury,
yet until now the full amounts have remained secret. Photographer: JB
Reed/Bloomberg
Citigroup Inc., along with Morgan
Stanley and Citigroup Inc., were the biggest borrowers under seven U.S.
Federal Reserve emergency-lending programs. Photographer: Robert
Caplin/Bloomberg
The Federal Reserve provided as
much as $1.2 tillion in public money to banks and other companies from
August 2007 through April 2010 to head off a depression. Source:
Bloomberg
Morgan Stanley, along with
Citigroup Inc., and Bank of America Corp., were the biggest borrowers
under seven Fed emergency-lending programs. The three banks' combined
$298.2 billion in hidden Fed loans was triple what they received in
publicly disclosed bailouts from the U.S. Treasury. Photographer: Peter
Foley/Bloomberg
Bank of America Corp., along with
Morgan Stanley and Citigroup Inc. was one of the biggest borrowers
under the U.S. Federal Reserve's emergency-lending programs. The three
banks' combined $298.2 billion in hidden Fed loans was triple what they
received in publicly disclosed bailouts from the U.S. Treasury.
Photographer: Jeremy Bales/Bloomberg
The Royal Bank of Scotland took
$84.5 billion in loans from the U.S. Federal Reserve's emergency-lending
programs. Photographer: Simon Dawson/Bloomberg
UBS AG, Switzerland's biggest
bank, got $77.2 billion in loans from the U.S. Federal Reserve's
emergency-lending programs. Photographer: Gianluca Colla/Bloomberg
Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets. Photographer: Scott Eells/Bloomberg
U.S. Federal Reserve borrowings
by Societe Generale SA, France's second-biggest bank, peaked at $17.4
billion in May 2008, four months after the Paris-based lender announced a
record 4.9 billion-euro ($7.2 billion) loss on unauthorizedstock-index
futures bets by former trader Jerome Kerviel. Photographer: Judith
White/Bloomberg
U.S. Federal Reserve borrowings
by Societe Generale SA, France's second-biggest bank, peaked at $17.4
billion in May 2008, four months after the Paris-based lender announced a
record 4.9 billion-euro ($7.2 billion) loss on unauthorized stock-index
futures bets by former trader Jerome Kerviel. Photographer: Antoine
Antoniol/Bloomberg
Fed Chairman Ben S. Bernanke’s unprecedented effort to keep
the economy from plunging into depression included lending banks
and other companies as much as $1.2 trillion of public money,
about the same amount U.S. homeowners currently owe on 6.5
million delinquent and foreclosed mortgages. The largest
borrower,
Morgan Stanley (MS), got as much as $107.3 billion, while
Citigroup took $99.5 billion and Bank of America $91.4 billion,
according to a Bloomberg News compilation of data obtained
through Freedom of Information Act requests, months of
litigation and an act of Congress.
“These are all whopping numbers,” said
Robert Litan, a
former Justice Department official who in the 1990s served on a
commission probing the causes of the
savings and loan crisis.
“You’re talking about the aristocracy of American finance going
down the tubes without the federal money.”
(View the Bloomberg
interactive graphic to chart the Fed’s
financial bailout.)
Foreign Borrowers
It wasn’t just American finance. Almost half of the Fed’s
top 30 borrowers, measured by peak balances, were European
firms. They included Edinburgh-based Royal Bank of Scotland Plc,
which took $84.5 billion, the most of any non-U.S. lender, and
Zurich-based
UBS AG (UBSN), which got $77.2 billion. Germany’s Hypo
Real Estate Holding AG borrowed $28.7 billion, an average of $21
million for each of its 1,366 employees.
The largest borrowers also included
Dexia SA (DEXB), Belgium’s
biggest bank by assets, and Societe Generale SA, based in Paris,
whose bond-insurance prices have surged in the past month as
investors speculated that the spreading sovereign debt crisis in
Europe might increase their chances of default.
The $1.2 trillion peak on Dec. 5, 2008 -- the combined
outstanding balance under the seven programs tallied by
Bloomberg -- was almost three times the size of the U.S. federal
budget deficit that year and more than the total earnings of all
federally insured banks in the U.S. for the decade through 2010,
according to data compiled by Bloomberg.
Peak Balance
The balance was more than 25 times the Fed’s pre-crisis
lending peak of $46 billion on Sept. 12, 2001, the day after
terrorists attacked the World Trade Center in
New York and the
Pentagon. Denominated in $1 bills, the $1.2 trillion would fill
539 Olympic-size swimming pools.
The Fed has said it had “no credit losses” on any of the
emergency programs, and a report by Federal Reserve Bank of New
York staffers in February said the central bank netted $13
billion in interest and fee income from the programs from August
2007 through December 2009.
“We designed our broad-based emergency programs to both
effectively stem the crisis and minimize the financial risks to
the U.S. taxpayer,” said James Clouse, deputy director of the
Fed’s division of monetary affairs in Washington. “Nearly all
of our emergency-lending programs have been closed. We have
incurred no losses and expect no losses.”
While the 18-month U.S. recession that ended in June 2009
after a 5.1 percent contraction in gross domestic product was
nowhere near the four-year, 27 percent decline between August
1929 and March 1933, banks and the economy remain stressed.
Odds of Recession
The odds of another recession have climbed during the past
six months, according to five of nine economists on the Business
Cycle Dating Committee of the National Bureau of Economic
Research, an academic panel that dates recessions.
Bank of America’s bond-insurance prices last week surged to
a rate of $342,040 a year for coverage on $10 million of debt,
above where
Lehman Brothers Holdings Inc. (LEHMQ)’s bond insurance was
priced at the start of the week before the firm collapsed.
Citigroup’s shares are trading below the split-adjusted price of
$28 that they hit on the day the bank’s Fed loans peaked in
January 2009. The U.S. unemployment rate was at 9.1 percent in
July, compared with 4.7 percent in November 2007, before the
recession began.
Homeowners are more than 30 days past due on their mortgage
payments on 4.38 million properties in the U.S., and 2.16
million more properties are in foreclosure, representing a
combined $1.27 trillion of unpaid principal, estimates
Jacksonville, Florida-based Lender Processing Services Inc.
Liquidity Requirements
“Why in hell does the Federal Reserve seem to be able to
find the way to help these entities that are gigantic?” U.S.
Representative Walter B. Jones, a Republican from North
Carolina, said at a June 1 congressional hearing in Washington
on Fed lending disclosure. “They get help when the average
businessperson down in eastern North Carolina, and probably
across America, they can’t even go to a bank they’ve been
banking with for 15 or 20 years and get a loan.”
The sheer size of the Fed loans bolsters the case for
minimum liquidity requirements that global regulators last year
agreed to impose on banks for the first time, said Litan, now a
vice president at the Kansas City, Missouri-based
Kauffman
Foundation, which supports entrepreneurship research. Liquidity
refers to the daily funds a bank needs to operate, including
cash to cover depositor withdrawals.
The rules, which mandate that banks keep enough cash and
easily liquidated assets on hand to survive a 30-day crisis,
don’t take effect until 2015. Another proposed requirement for
lenders to keep “stable funding” for a one-year horizon was
postponed until at least 2018 after banks showed they’d have to
raise as much as $6 trillion in new long-term debt to comply.
‘Stark Illustration’
Regulators are “not going to go far enough to prevent this
from happening again,” said
Kenneth Rogoff, a former chief
economist at the
International Monetary Fund and now an
economics professor at Harvard University.
Reforms undertaken since the crisis might not insulate U.S.
markets and financial institutions from the sovereign budget and
debt crises facing Greece, Ireland and Portugal, according to
the U.S. Financial Stability Oversight Council, a 10-member body
created by the Dodd-Frank Act and led by Treasury Secretary
Timothy Geithner.
“The recent financial crisis provides a stark illustration
of how quickly confidence can erode and financial contagion can
spread,” the council said in its July 26 report.
21,000 Transactions
Any new rescues by the U.S. central bank would be governed
by transparency laws adopted in 2010 that require the Fed to
disclose borrowers after two years.
Fed officials argued for more than two years that releasing
the identities of borrowers and the terms of their loans would
stigmatize banks, damaging stock prices or leading to depositor
runs. A group of the biggest commercial banks last year asked
the U.S. Supreme Court to keep at least some Fed borrowings
secret. In March, the high court declined to hear that appeal,
and the central bank made an unprecedented release of records.
Data gleaned from 29,346 pages of documents obtained under
the Freedom of Information Act and from other Fed databases of
more than 21,000 transactions make clear for the first time how
deeply the world’s largest banks depended on the U.S. central
bank to stave off cash shortfalls. Even as the firms asserted in
news releases or earnings calls that they had ample cash, they
drew Fed funding in secret, avoiding the stigma of weakness.
Morgan Stanley Borrowing
Two weeks after Lehman’s bankruptcy in September 2008,
Morgan Stanley countered concerns that it might be next to go by
announcing it had “strong capital and liquidity positions.”
The statement, in a Sept. 29, 2008, press release about a $9
billion investment from Tokyo-based Mitsubishi UFJ Financial
Group Inc., said nothing about Morgan Stanley’s Fed loans.
That was the same day as the firm’s $107.3 billion peak in
borrowing from the central bank, which was the source of almost
all of Morgan Stanley’s available cash, according to the lending
data and documents released more than two years later by the
Financial Crisis Inquiry Commission. The amount was almost three
times the company’s total profits over the past decade, data
compiled by Bloomberg show.
Mark Lake, a spokesman for New York-based Morgan Stanley,
said the crisis caused the industry to “fundamentally re-
evaluate” the way it manages its cash.
“We have taken the lessons we learned from that period and
applied them to our liquidity-management program to protect both
our franchise and our clients going forward,” Lake said. He
declined to say what changes the bank had made.
Acceptable Collateral
In most cases, the Fed demanded collateral for its loans --
Treasuries or corporate bonds and mortgage bonds that could be
seized and sold if the money wasn’t repaid. That meant the
central bank’s main risk was that collateral pledged by banks
that collapsed would be worth less than the amount borrowed.
As the crisis deepened, the Fed relaxed its standards for
acceptable collateral. Typically, the central bank accepts only
bonds with the highest credit grades, such as U.S. Treasuries.
By late 2008, it was accepting “junk” bonds, those rated below
investment grade. It even took stocks, which are first to get
wiped out in a liquidation.
Morgan Stanley borrowed $61.3 billion from one Fed program
in September 2008, pledging a total of $66.5 billion of
collateral, according to Fed documents. Securities pledged
included $21.5 billion of stocks, $6.68 billion of bonds with a
junk credit rating and $19.5 billion of assets with an “unknown
rating,” according to the documents. About 25 percent of the
collateral was foreign-denominated.
‘Willingness to Lend’
“What you’re looking at is a willingness to lend against
just about anything,” said Robert Eisenbeis, a former research
director at the Federal Reserve Bank of Atlanta and now chief
monetary economist in Atlanta for Sarasota, Florida-based
Cumberland Advisors Inc.
The lack of private-market alternatives for lending shows
how skeptical trading partners and depositors were about the
value of the banks’ capital and collateral, Eisenbeis said.
“The markets were just plain shut,” said Tanya Azarchs,
former head of bank research at Standard & Poor’s and now an
independent consultant in Briarcliff Manor, New York. “If you
needed liquidity, there was only one place to go.”
Even banks that survived the crisis without government
capital injections tapped the Fed through programs that promised
confidentiality. London-based
Barclays Plc (BARC) borrowed $64.9
billion and Frankfurt-based
Deutsche Bank AG (DBK) got $66 billion.
Sarah MacDonald, a spokeswoman for Barclays, and John Gallagher,
a spokesman for Deutsche Bank, declined to comment.
Below-Market Rates
While the Fed’s last-resort lending programs generally
charge above-market
interest rates to deter routine borrowing,
that practice sometimes flipped during the crisis. On Oct. 20,
2008, for example, the central bank agreed to make $113.3
billion of 28-day loans through its
Term Auction Facility at a
rate of 1.1 percent, according to a
press release at the time.
The rate was less than a third of the 3.8 percent that
banks were charging each other to make one-month loans on that
day. Bank of America and Wachovia Corp. each got $15 billion of
the 1.1 percent TAF loans, followed by Royal Bank of Scotland’s
RBS Citizens NA unit with $10 billion, Fed data show.
JPMorgan Chase & Co. (JPM), the New York-based lender that touted
its “fortress balance sheet” at least 16 times in press
releases and conference calls from October 2007 through February
2010, took as much as $48 billion in February 2009 from TAF. The
facility, set up in December 2007, was a temporary alternative
to the discount window, the central bank’s 97-year-old primary
lending program to help banks in a cash squeeze.
‘Larger Than TARP’
Goldman Sachs Group Inc. (GS), which in 2007 was the most
profitable securities firm in Wall Street history, borrowed $69
billion from the Fed on Dec. 31, 2008. Among the programs New
York-based Goldman Sachs tapped after the Lehman bankruptcy was
the Primary Dealer Credit Facility, or PDCF, designed to lend
money to brokerage firms ineligible for the Fed’s bank-lending
programs.
Michael Duvally, a spokesman for Goldman Sachs, declined to
comment.
The Fed’s liquidity lifelines may increase the chances that
banks engage in excessive risk-taking with borrowed money,
Rogoff said. Such a phenomenon, known as moral hazard, occurs if
banks assume the Fed will be there when they need it, he said.
The size of bank borrowings “certainly shows the Fed bailout
was in many ways much larger than TARP,” Rogoff said.
TARP is the Treasury Department’s Troubled Asset Relief
Program, a $700 billion bank-bailout fund that provided capital
injections of $45 billion each to Citigroup and Bank of America,
and $10 billion to Morgan Stanley. Because most of the
Treasury’s investments were made in the form of preferred stock,
they were considered riskier than the Fed’s loans, a type of
senior debt.
Dodd-Frank Requirement
In December, in response to the
Dodd-Frank Act, the Fed
released 18 databases detailing its temporary emergency-lending
programs.
Congress required the disclosure after the Fed rejected
requests in 2008 from the late Bloomberg News reporter Mark Pittman and other media companies that sought details of its
loans under the Freedom of Information Act. After fighting to
keep the data secret, the central bank released unprecedented
information about its discount window and other programs under
court order in March 2011.
Bloomberg News combined Fed databases made available in
December and July with the discount-window records released in
March to produce daily totals for banks across all the programs,
including the Asset-Backed Commercial Paper Money Market Mutual
Fund Liquidity Facility, Commercial Paper Funding Facility,
discount window, PDCF, TAF,
Term Securities Lending Facility and
single-tranche open market operations. The programs supplied
loans from August 2007 through April 2010.
Rolling Crisis
The result is a timeline illustrating how the credit crisis
rolled from one bank to another as financial contagion spread.
Fed borrowings by
Societe Generale (GLE), France’s second-biggest
bank, peaked at $17.4 billion in May 2008, four months after the
Paris-based lender announced a record 4.9 billion-euro ($7.2
billion) loss on unauthorized stock-index futures bets by former
trader Jerome Kerviel.
Morgan Stanley’s top borrowing came four months later,
after Lehman’s bankruptcy. Citigroup crested in January 2009, as
did 43 other banks, the largest number of peak borrowings for
any month during the crisis. Bank of America’s heaviest
borrowings came two months after that.
Sixteen banks, including Plano, Texas-based Beal Financial
Corp. and Jacksonville, Florida-based EverBank Financial Corp.,
didn’t hit their peaks until February or March 2010.
Using Subsidiaries
“At no point was there a material risk to the Fed or the
taxpayer, as the loan required collateralization,” said Reshma Fernandes, a spokeswoman for EverBank, which borrowed as much as
$250 million.
Banks maximized their borrowings by using subsidiaries to
tap Fed programs at the same time. In March 2009, Charlotte,
North Carolina-based Bank of America drew $78 billion from one
facility through two banking units and $11.8 billion more from
two other programs through its broker-dealer, Bank of America
Securities LLC.
Banks also shifted balances among Fed programs. Many
preferred the TAF because it carried less of the stigma
associated with the discount window, often seen as the last
resort for lenders in distress, according to a January 2011
paper by researchers at the New York Fed.
After the Lehman bankruptcy, hedge funds began pulling
their cash out of Morgan Stanley, fearing it might be the next
to collapse, the Financial Crisis Inquiry Commission said in a
January
report, citing interviews with former Chief Executive
Officer John Mack and then-Treasurer David Wong.
Borrowings Surge
Morgan Stanley’s borrowings from the
PDCF surged to $61.3
billion on Sept. 29 from zero on Sept. 14. At the same time, its
loans from the Term Securities Lending Facility, or TSLF, rose
to $36 billion from $3.5 billion. Morgan Stanley treasury
reports released by the FCIC show the firm had $99.8 billion of
liquidity on Sept. 29, a figure that included Fed borrowings.
“The cash flow was all drying up,” said Roger Lister, a
former Fed economist who’s now head of financial-institutions
coverage at credit-rating firm
DBRS Inc. in New York. “Did they
have enough resources to cope with it? The answer would be yes,
but they needed the Fed.”
While Morgan Stanley’s Fed demands were the most acute,
Citigroup was the most chronic borrower among the largest U.S.
banks. The New York-based company borrowed $10 million from the
TAF on the program’s first day in December 2007 and had more
than $25 billion outstanding under all programs by May 2008,
according to Bloomberg data.
Tapping Six Programs
By Nov. 21, when Citigroup began talks with the government
to get a $20 billion capital injection on top of the $25 billion
received a month earlier, its Fed borrowings had doubled to
about $50 billion.
Over the next two months the amount almost doubled again.
On Jan. 20, as the stock sank below $3 for the first time in 16
years amid investor concerns that the lender’s capital cushion
might be inadequate, Citigroup was tapping six Fed programs at
once. Its total borrowings amounted to more than twice the
federal Department of Education’s 2011 budget.
Citigroup was in debt to the Fed on seven out of every 10
days from August 2007 through April 2010, the most frequent U.S.
borrower among the 100 biggest publicly traded firms by pre-
crisis market valuation. On average, the bank had a daily
balance at the Fed of almost $20 billion.
‘Help Motivate Others’
“Citibank basically was sustained by the Fed for a very
long time,” said Richard Herring, a finance professor at the
University of Pennsylvania in Philadelphia who has
studied
financial crises.
Jon Diat, a Citigroup spokesman, said the bank made use of
programs that “achieved the goal of instilling confidence in
the markets.”
JPMorgan CEO
Jamie Dimon said in a
letter to shareholders
last year that his bank avoided many government programs. It did
use TAF, Dimon said in the letter, “but this was done at the
request of the Federal Reserve to help motivate others to use
the system.”
The bank, the second-largest in the U.S. by assets, first
tapped the TAF in May 2008, six months after the program
debuted, and then zeroed out its borrowings in September 2008.
The next month, it started using TAF again.
On Feb. 26, 2009, more than a year after TAF’s creation,
JPMorgan’s borrowings under the program climbed to $48 billion.
On that day, the overall TAF balance for all banks hit its peak,
$493.2 billion. Two weeks later, the figure began declining.
“Our prior comment is accurate,” said
Howard Opinsky, a
spokesman for JPMorgan.
‘The Cheapest Source’
Herring, the University of Pennsylvania professor, said
some banks may have used the program to maximize profits by
borrowing “from the cheapest source, because this was supposed
to be secret and never revealed.”
Whether banks needed the Fed’s money for survival or used
it because it offered advantageous rates, the central bank’s
lender-of-last-resort role amounts to a free insurance policy
for banks guaranteeing the arrival of funds in a disaster,
Herring said.
An IMF report
last October said regulators should consider
charging banks for the right to access central bank funds.
“The extent of official intervention is clear evidence
that systemic liquidity risks were under-recognized and
mispriced by both the private and public sectors,” the IMF said
in a
separate report in April.
Access to Fed backup support “leads you to subject
yourself to greater risks,” Herring said. “If it’s not there,
you’re not going to take the risks that would put you in trouble
and require you to have access to that kind of funding.”
To contact the reporters on this story:
Bradley Keoun in New York at
bkeoun@bloomberg.net;
Phil Kuntz in New York at
Pkuntz1@bloomberg.net.
To contact the editor responsible for this story:
David Scheer in New York at
dscheer@bloomberg.net.
