My Surreal Life: Jon Corzine

Although I've never actually had a conversation with MF Global's disgraced former CEO, Jon Corzine, all of the statements ascribed to Corzine below are rigorously authentic.

John Corzine: My grandfather was a big-time farmer, had about 2,000 acres. Unfortunately, he did what a lot of people are doing today: Borrowed too much money. And when the 1920s collapse came, he lost absolutely everything. Everything you do, as a farmer, is at risk.

Alex Dumortier: That's one lesson that never held you back.

JC: [At Goldman Sachs (NYSE: GS  ) ] there was a focus on something other than just the profitability of the firm, but [on] the role of a firm and its people in the community it lives in.

AD: Those were the days.

JC: I'm excited about the next five, ten years at MF Global. I think actually building in an entrepreneurial environment, which I think MF Global provides, is going to be one of the exciting parts of my life. This is an opportunity to create value and a firm that I think will have a long life over a long period of time if we do it right.

AD: There was certainly no shortage of excitement.

JC: I believe there is a very important role for a high ethic, high integrity financial institution to operate in today's global markets. I think we can be good corporate citizens, help form capital and move it to the right places.

AD: Alternatively, you could help form capital and move it to the wrong places.

JC: We have to be disciplined; we can't go running 30:1 leverage ratios on our balance sheet.

AD: I agree. A 30:1 leverage ratio on a balance sheet is unacceptable; that kind of leverage belongs off-balance sheet.

JC: I believe there is substantial ability to grow [revenues] without really changing our risk appetite as opposed to our risk participation.

AD: Huh? I'm not following.

JC: And like every financial institution, making certain that you don't have the kind of car crash that this organization experienced back three or four years ago is essential by having tight controls, tight compliance, and making it part of the culture. And that's the kind of people we're hiring, and that's the kind of culture we're building.

AD: You clearly have your ambitions set much higher than that kind of car crash.

JC: I've spent a lifetime in this and I feel like we have developed an expertise that is consistent with a very best in class.

AD: You stand shoulder-to-shoulder with the Lehman Brothers and Bear Stearns of this world.

JC: We believe that not with every country, but with differentiated amounts of commitment, short dated participation in sovereign debt made sense at a basis that wasn't betting the ranch, but was improving our yields.

AD: As long as you can still bet the farm.

JC: Whatever you do, you've got to try to do very, very well. Try to be the leader in the world that you're about.

AD: Uh huh.

JC: Every institution ends up making mistakes; individuals and even sometimes the organizations themselves.

AD: No arguments there.

JC: As an old washed-up trader...

AD: Your words, not mine.

JC: Let me close by noting that while we recognize and respect the challenges of the environment, we also believe it is filled with opportunity...

AD: ...for your competitors. Thank you, Mr. Corzine.

Our team here at The Motley Fool is continuing to dig deep into the MF Global mess. If you'd like to share any information with us, email tips@fool.com or call our tip line at 703-254-1546.

Fool contributor Alex Dumortier holds no position in any company mentioned. Click here to see his holdings and a short bio. You can follow him on Twitter. Motley Fool newsletter services have recommended buying shares of The Goldman Sachs Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (14) | Recommend This Article (28)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 23, 2011, at 10:42 AM, PhulishMortal wrote:

    "You clearly have your ambitions set much higher than that kind of car crash."

    I laughed at that one.

  • Report this Comment On November 23, 2011, at 11:19 AM, TMFPhillyDot wrote:

    Thank you Alex. I would say I laughed out loud a few different times. Fool on brother!

    Jordan (TMFPhillyDot)

  • Report this Comment On November 23, 2011, at 12:09 PM, c5700 wrote:

    Alex, very well done.

    Now, if only the OWS-types would camp outside his house............to further Mr. Corzine's surreal life of course.

  • Report this Comment On November 23, 2011, at 12:16 PM, DellSpa wrote:

    Funny...it is interesting that JC was preaching ethics and integrity, but he was doing the opposite.

  • Report this Comment On November 23, 2011, at 12:28 PM, TMFBane wrote:

    Outstanding piece, Alex! Here's another quote from JC's Goldman days, "Risk control is fundamental. Legal, credit, market, operational, reputational, expense, and liquidity provision must have first order priority. A breakdown here can be fatal." Yes, fatal indeed!

  • Report this Comment On November 23, 2011, at 12:53 PM, TMFKopp wrote:

    Great work Alex!

    Matt

  • Report this Comment On November 23, 2011, at 1:41 PM, briansal wrote:

    sequel to "car crash", how about "train wreck" or "financial nuclear disaster".

  • Report this Comment On November 23, 2011, at 2:40 PM, TMFMileHigh wrote:

    Terrific stuff. Well done, Alex.

    Tim

  • Report this Comment On November 23, 2011, at 3:39 PM, TMFAleph1 wrote:

    Thanks for the kind comments, everyone. I'll just re-iterate that every single quote in the article from Corzine is factual -- he said all of these things.

    Alex D

  • Report this Comment On November 23, 2011, at 4:25 PM, bretco wrote:

    he wasn't very good as our governer,

    obviously worse as a hedgefund operator,

    hopefully he will be a better prisoner.

  • Report this Comment On November 23, 2011, at 5:09 PM, DividendsBoom wrote:

    What a dufus. Great article, it is clear he got used to the political world where doing things opposite of what you promise has no ramifications.

  • Report this Comment On November 23, 2011, at 5:25 PM, WeWereWallStreet wrote:

    Great piece!

    Poor Corzine. We think he's just hit a rough patch, that the money will turn up and he'll be back in circulation soon. We have a couple ditties on him and the Olympus fools here: www.WeWereWallStreet.com/Corzine-what-goes-round.html .

    Meanwhile, it sure is fun to watch.

  • Report this Comment On November 23, 2011, at 7:05 PM, nickjob wrote:

    For all of us, including me, who did not get hurt by Corzine, we can sit back and laugh at this dufuss. Because I was in the business, however, I know some of the ones who continue to get hurt, and I genuinely feel bad for them. In addition, as one who has been retired for 5 years, it sickens me to think that a business I loved so much, where I met so many good, honest, competitive people can be destroyed by one out of control egomaniac.

  • Report this Comment On December 02, 2011, at 12:56 PM, EquityBull wrote:

    Let's see if our legal system and government work. He signed off on SarBox as CEO. He is responsible for what happened. Congress just subpoenaed him to appear. Will he take the 5th or talk? Will they ever prosecute him and put him away like they did Rajaratnam who only did insider trading? I doubt it but one can dream.

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