All language subtitles for remux-The.Eighties.S01E04.WEBRip.x264-ION10_track3_[eng]

In "Money Matters" this morning,
Wall Street,

where leaping stocks
have investors jumping.

We're going to turn
the bull loose.

Ivan Boesky:
One of the great things
about this nation

is that we can seek profit.

Shriver: Is money
the number-one goal?

Yes.

Rogers: We've had 29-year-olds
making $1 million a year,

expecting to make $2 million
the year after that.

Diana Ferry:
But if you've got plastic money,

there's nothing
holding you back.

History will prove
the Bakkers were honest people.

Reporter: Insider trading could
become Wall Street's Watergate.

Pauley: What do we call greed
the day before an indictment?

I'm afraid recently,
we've called it success.

♪♪

Robinson:
The U.S. economy, which used to
be the envy of the world,

is in the most serious trouble
since the Great Depression.

Inflation is rising while our
standard of living is declining.

Thomas:
There was tremendous inflation

and not much growth.

The country was not
in a great depression in 1980,

but the United States
was in the dumps.

Dobyns: On Wall Street, it was
cold, gray, wet, and miserable.

There was no comfort
to be found outside.

And for investors, there was
not much inside, either.

The tickers carried
almost nothing but bad news.

McLean: We'd come off
a terrible decade for investing.

People were skeptical
of the stock market.

It was a very sleepy Wall Street
back then.

Most economists expect
a serious recession,

with at least 2 million more
Americans losing their jobs.

President Reagan:
I regret to say

that we're in the worst economic
mess since the Great Depression.

Literally from the first moments
of his presidency on,

President Reagan let it be known

that his top priority
is the nation's economy.

I put a freeze
on pending regulations,

and set up a task force
under Vice President Bush

to review regulations

with an eye toward getting rid
of as many as possible.

The philosophy
behind deregulation

was that markets worked better
than government controls.

This bill represents
the first step

in our administration's
comprehensive program

of financial deregulation.

Tett:
Introducing deregulation,

finance began to get
much more creative

and, frankly,
much more profitable, too.

In "Money Matters" this morning,
Wall Street,

where leaping stocks
have investors jumping.

When the market opens
for trading this morning,

the Dow Jones industrial Average

will stand
at its highest level ever.

Cordtz:
The past few months

have been among the wildest
in Wall Street's history.

I need 65.

Stock and bond prices soared
in a frenzy of activity.

Red sheet,
pick up Tanner!

Optimists on Wall Street
are talking about

the beginnings
of economic recovery.

Gumbel:
The supporters of deregulation

point to the soaring
stock market as evidence

that a deregulated economy
makes money for everyone.

Sorkin: The stock market
took off like a rocket,

and the public
saw this happening,

and they would read about it.

And so all sorts of people

who used to have
nothing to do with this world

started pouring
their own money into it.

And that's in large part

also what drove prices
to go even higher.

Donaldson:
The Ronald Reagan motorcade

rolled onto Wall Street today
to the New York Stock Exchange.

In the last five years,
we've moved from malaise

to hope, confidence,
and opportunity

with the volume of shares traded
hitting record highs

and more Americans
than ever before

participating in the market.

We're bullish
on the American economy.

[ Cheers and applause ]

[ Crowd chanting "Ronnie!" ]

When Reagan shows up
at the Stock Exchange,

them yelling "Ronnie! Ronnie!"

is a way of saying
"America's back."

And that was
Ronald Reagan's genius.

He was able to link economic
faith with faith in America.

Donaldson: No sitting president
had ever visited

the New York Stock Exchange
before,

but it seems safe to say
that no recent president

would've beaten Mr. Reagan
for the honor

if a vote had been taken
among the floor traders.

They gave him
round after round of cheer.

We're going to turn
the bull loose.

Auletta: The whole world
from Reagan's White House on

was basically saying Wall Street
is the engine of our economy.

It represents growth,
it represents opportunity,

it represents
the American dream.

And so these guys were basically
saying "We're gonna go do it."

Brokaw: This is the big draw
on Wall Street --

the smell of money.

This is where the action is.

This is the over-the-counter
trading floor

of Shearson/Lehman.

More than 17,000
daily transactions

involving millions of shares
and millions of dollars

made and lost here every day.

And it's a game
for young people.

When you get home
at the end of the week

and you look back on what you've
done sitting in this desk,

what gives you
a sense of satisfaction?

I guess, uh...

making a lot of money.

For yourself
or for the company?

Myself and for the firm,
yeah.

When the economy started to
recover and become more vibrant,

I think there was a great sense
of exhilaration.

You know, we survived
this miserable period,

"Let's celebrate. Let's party.
We have money to spend."

Today, the fad among young
people is to have big salaries,

fancy clothes, and fast cars,
and they are called Yuppies.

Rose: But who are these partiers
with portfolios,

these Yuppies?

A Yuppie is a person
who owns a Macintosh,

who eats fine quiche,
and drinks white wine,

and that's me.

I'm having
a great time here.

29-year-olds
making $1 million a year,

expecting to make
a million and a half next year

and $2 million
the year after that.

Shriver: For this generation,
business is hip.

Capitalism is no sin.
It's in.

Shriver: Is money
the number-one goal?

Yes.

♪♪

♪ All of the fun ♪

♪ Is waiting for you
at the Castle ♪

♪ Trump's Castle ♪

Wallace: In a world where mere
millionaires are a dime a dozen.

there's a new billionaire
in town.

He's 40 years old,
his town is New York City,

and he's made his money mainly
from Manhattan real estate.

He puts his name on
almost everything he builds --

says it's a symbol of quality.

But others say
it's part of the hype.

Troy: Donald Trump,
he is the brand,

and he is the symbol
of a new swashbuckling approach

to commerce,
to entrepreneurship,

and also to
conspicuous consumption.

Smith: We definitely
do now have people

who have become celebrities
just from being rich.

I'll take the Trumps
as a good example.

I mean, their celebrity
is generally that they are rich.

Donald Trump has also ventured

into gambling
and professional football

and says he could negotiate
a nuclear disarmament treaty

with the Soviet Union.

Wallace:
They say he's land-hungry,
money-hungry, power-hungry.

The power is nonsense.
I love the creative process.

Wallace: What about the name
of Trump City?

Trump Tower
we're sitting in?

Trump Plaza?
Trump Castle?

It sells, Mike.
All I know is --

That's all it is?

It has nothing to do
with the ego.

All I know
is it sells.

What do you do?

Security.

We don't need
security here.

Let's go outside.
We have people outside.

Auletta: Leona Helmsley
was the wife of Harry Helmsley,

one of the major --
much bigger than Trump --

real estate developers
in New York.

I asked for something.
I did not get it from you.

I want it.

You have nothing to do?

Connelly: Leona Helmsley,
"The Queen of Mean."

The idea was
that she was so mean

because she wanted you to have
a great experience

in one of her hotels.

Really?

Seemed like
she was just mean.

Oh, my.
It's paradise.

He stands here and he says
"I'm taking inventory,"

I own this, I own this,
I own this,

and that one and that one
and that one."

He plays Monopoly,
but with real buildings.

With real buildings.

Wallace: They bought this
Connecticut estate a year ago --

26 acres, 28 rooms --
for just the two of them.

And this building structure
is just what?

Tell him.

It's the enclosure
of the swimming pool.

And up top?

On top, we're going to have,
of course, a dance floor.

♪ Dance in
an old-fashioned way ♪

Leona Helmsley became
a kind of a symbol

of the excesses of the '80s.

Am I comfortable?
I make a living.

Kuralt:
This is the way we live now.

Nice even temperature,
no rain, no snow,

no loud noises,
music is playing.

Everything's perfect
in the mall.

Troy:
In the 1980s, you have 16,000
malls popping up like mushrooms.

And they become the high temples

of the great
American religion -- shopping.

Kuralt: Pam and Melissa,
15 years old,

come to the mall
almost every day.

They call themselves
mallrats.

I love it, too,
Pam.

It's only $24.

Tett: Consumerism definitely
took off in the '80s.

People emerged from the 1970s,
which were tough economic times,

and went "Wow,
we can now spend."

I want you to think about
this Florentine Plum also.

Honey, that's what's gonna
set your eyes off.

Brands:
The economy started growing,

and it was largely
a consumer-driven growth.

But the consumer economy
was funded by debt.

Kiker:
The national bankruptcy rate
is soaring.

Greg and Diana Ferry --
annual income $32,000.

They had over $12,000
in unsecured debts

when they bought a new home.

Then they bought
a new washer, a dryer,

a microwave oven,
and a Betamax TV recorder.

Then they went bankrupt.

I knew I didn't have the money,
but if you've got plastic money,

there's nothing
holding you back.

All of a sudden, it became
very acceptable to have debt.

It became very acceptable
to have a credit card.

More than acceptable

if you wanted to pull it out
of your wallet and use it.

Live from Tampa Bay, Florida,
it's the Home Shopping Club.

[ Horn squeaks ]

Safer:
Every doodad and and tchotchke
that man's hand hath wrought.

Americans seem utterly hooked
on home shopping.

Your order has been completed
for one of the ruby bracelets.

So, I have you down for two
of the plush musical bunnies.

[ Cowbell clanging ]

Safer: There are
Home Shopping Club parties.

Like-minded consumers
gather together

to do what comes naturally.

I want four
of those bird figurines.

You don't have to
leave your house,

and stuff will come to you.

Welcome to America.

Jim Bakker:
Give us 300 more people

to call on their credit card,
right now...

If you and enough people
will send me $100 immediately,

I need some very quick money.

Go to the phone right now.

Now!

Quit talking about
saying you believe in God

without ever acting on his word.

Now!

Faith is an act!

Koppel: In all, there are
1,600 television ministers.

And of the $1.5 billion
grossed annually,

just three of them --
Pat Robertson's,

Jimmy Swaggart's,
and Jim Bakker's --

took in close to $500 million.

Safer: The prime-time preachers
say they need the money

to stay on the air,

and they need to stay on the air
to raise money --

money for the kind
of electronic equipment

any network
would be proud to own.

I believe God wants us
in the next 30 days

to have every one of these bills
paid in full,

and PTL can live
if we pay our bills.

It pays the bills

if we would all just do
[Voice breaking] something.

Troy:
As televangelism grows,

Jim Bakker is the one
who truly gets it.

He understands that preaching
on television is not just about

standing up and giving
a fire-and-brimstone speech.

He understands
that in the age of television,

the Johnny Carson approach
to televangelism,

that being more intimate,
showing your lifestyle,

and your beautiful family
is essential

because it brings people in.

And he's
a brilliant entrepreneur,

and he's a brilliant salesman
of himself.

♪ PTL ♪

And now here are Jim and Tammy!

Clayton:
Their appeal is powerful.

Last year,
a million people responded

to the Bakkers' constant request
for money.

Tammy Bakker:
How many do you have right now?

Just about 30.

30 what?

Silver 7000 clubs.

That's $90,000.

Praise God.

Clayton: The Bakkers
have been criticized

for their own lavish lifestyle.

Well, just because
I'm a Christian

doesn't mean I don't like
nice things, either.

I love nice things,

and Jim and I work
very, very hard for nice things.

They say the only difference
between men and boys

is the price
of their toys.

Rose: Toys like
a fleet of luxury cars

and a string of fancy homes

from Palm Springs, California,
to Tega Cay, South Carolina.

Troy: They create what I call
the "Gospel of Prosperity"

where they think
that by them living well,

by them having Rolls-Royces
that everyone will think, "Ah.

God is shining his countenance
upon them, and thus upon us."

And PTL also becomes the vehicle
for their media empire,

for their theme parks.

Jim Bakker: If we are to be
fishers of men --

that's what the Bible says,
we are fishers of men --

we've been using
some pretty lousy bait.

We've just built better bait
to reach people.

You can have
a lifetime partnership with PTL

for a one-time gift of $1,000.

Four days and three nights

every year
for the rest of your life.

Troy: That mix of God and greed
ends up derailing them,

and ends up leading them
to breaking the very rules

that they are preaching about.

Television evangelist Jim Bakker
has stepped down

as the head of
the Praise the Lord,
or PTL, ministry.

Hazinski: Bakker's resignation
reportedly came

because of a sexual encounter
seven years ago.

Hall: Jessica Hahn
is to be paid monthly

as long as she keeps quiet
about the incident.

It turns out that Jim Bakker has
been paying off this secretary,

and that shakes
the evangelical world.

The evidence seems to indicate

that effort and money have been
expended to cover moral failure.

If Jim Bakker paid Jessica Hahn
"hush money,"

what else has he been doing
with the PTL money?

Do you worry about
the investigations
that are going on?
Jim and Tammy: Not at all.

History will prove
the Bakkers were honest people.

We interrupt this program
for an NBC News Special Report.

Jim Bakker, the defrocked head
of the PTL ministry,

has been found guilty

on all 24 counts
of fraud and conspiracy

by a jury
in Charlotte, North Carolina.

Jones:
Bakker kept selling lifetime
partnerships at Heritage USA

even though he knew
they were oversold.

For example,
the Heritage Grand Hotel

could accommodate
only 25,000 partnerships,

but 65,000 were sold.

And for the lower-priced
Bunkhouse partnerships,

about 7,000 were sold

for a building
that had only eight rooms.

Gumbel: Estelle Pollard sent
Jim and Tammy Bakker's PTL Club

$15 a month for 15 years.

She thought
that by giving to them,

God would ease her pain
and that of her ailing husband.

I have been one to help make
millionaires out of those people

when I don't have enough
to even live on.

Jones: Bakker could be sentenced
to 120 years in prison

and fined over $5 million.

I would say I feel sad,
but encouraged in God.

Hall:
Tammy Bakker said she could best
describe her feelings in song.

♪ On Christ,
the solid rock I stand ♪

♪ All other ground
is sinking sand ♪

Smith: Today, we travel
to the Lone Star State

to visit tycoon entrepreneur
T. Boone Pickens,

the highest paid CEO
in the country.

Even here,
Wall Street is in charge.

Wall Street being a parrot --
green, as in money.

He reigns over an entry foyer

that runs
the entire length of the house,

and at the end
of that long foyer,

we find this morning
Boone Pickens.

Good morning, sir.
How are you?

Good morning, Harry.

Why don't we go ahead

and head into the trophy room,
if you don't mind?

Sure.

Nocera: T. Boone Pickens
was a Texas oilman

who became
the original corporate raider.

He would buy a bunch of stock
in the company,

talk about how the executives
needed to be tossed out,

and make a play
to take over the company.

Rodriguez: Pickens' company,
Mesa Petroleum,

which is only
1/20th the size of Phillips,

moves first by buying
5.8% of the stock privately.

Now Pickens lets it be known

that he wants to buy another 15%
from the shareholders

and thus gain a seat
on the corporate board.

There's one thing
I want to put in place,

is that stockholders
own companies

and managements are employees.

Stahl:
Phillips agreed to buy back
its stock from T. Boone Pickens

to stop his takeover bid.

The profit to Pickens
and his partners -- $89 million.

It is no secret that you've made
about a half a billion dollars

through losing
on your attempted takeovers.

Do you go into it

anticipating that a loss is
still gonna stand you very well?

Well, you never like to lose,
but if you lose and make money,

well, it makes it
a little easier.

I remember I was someplace

and the guy got up and said,
"I have a question."

He said, "You're making
a lot of money out of this,"

and I said,
"The shareholders are, too."

He said, "Yes,
but you're a fast-buck artist."

"Fast-buck artist."

I said, "Who in the hell
would want to be known

as a slow-buck artist?"

I see it as a free-enterprise
system working at its best.

Burrough: Pickens was really
the first major investor

to realize how undervalued
American companies were

and what you could buy there.

And it was his early tilts
at Gulf, City Services,

all these famous deals
that brought this new reality

to the attention
of other investors,

who followed in his wake

and sought to imitate
what he did.

I freely admit that
I'm an investor and
I want to make a profit.

I freely admit
I'm not Robin Hood.

It is not wrong to want
to profit in capitalist America.

It's fair.

Delaney:
Ivan Boesky has made a fortune
buying into companies

being pursued
by takeover artists.

Boesky doesn't want
to run those companies --

just to profit from the run-up
in their stock prices.

Levine:
Forbes magazine lists Boesky

among the 400 richest people
in America,

estimating his wealth
at well over $200 million.

Where's my share
of the profits?

Stewart: Ivan Boesky
gave the commencement speech

1986 at Berkeley,

and he really became famous
for one line in that speech.

[ Laughter,
cheers and applause ]

[ Laughter ]

Stourton:
A new film, "Wall Street,"
used Boesky's words

as the basis
for some of the dialogue.

Greed is good.

Greed is right.

Greed works.

[ Applause ]

Auletta: When Michael Douglas,
in the movie,

said, "Greed is good," I mean,
it was a cartoon expression.

But there's truth to it.

There was a sense
that it is okay to be greedy,

it is okay
to maximize your wealth.

What I want to see above all

is that this country
remains a country

where someone
can always get rich.

Brokaw: Big companies
gobbling up little companies.

Little companies
gobbling up big companies.

Eight years ago, there were
1,500 corporate takeovers.

Last year, there were 4,000,
involving $200 billion.

Aug: This type of deal is called
a leveraged buyout.

The company borrows the money

using its assets
as collateral for the loan.

In return
the company issues IOUs.

Because the deal is so risky,

those IOUs carry
very high interest rates,

and they're called junk bonds.

Now, you may not have heard
of Michael Milken

of the investment banking firm
of Drexel Burnham Lambert, Inc.,

but this 40-year-old
Wall Street whiz

is said to be the most powerful
financier in America.

He brought respectability
to low-rated junk bonds

and then used the money

to finance corporate raids
and takeovers.

Without Mike Milken
T. Boone Pickens couldn't

have raided Gulf, Unocal,
and Phillips Petroleum.

Pickens: The Gulf deal
was the first time I saw Milken.

He said, "If you really want
to take over Gulf,

it's gonna cost you
$13 billion."

[ Laughing ]
And I said, "Yeah, I get it."

And he said,
"I can get the $13 billion."

Palmer: He's the guy
that T. Boone Pickens goes to,

and most people
haven't heard of him.

Well, that's just the way
he likes it.

He doesn't care about publicity.
He doesn't care about pride.

All he cares about

is making money, doing deals,
and having power.

Burrough: He was this shadowy
Howard Hughes-like figure

that those of us
even in the press never saw,

you just heard
[Whispering] "It's Milken."

But, you know,
it was Milken's genius --

and I think
that is the correct word --

that created an entire market

and fueled
this takeover phenomena.

Reich: We romanticize
these characters.

The fact of the matter is,
these are fat cats,

first cousins
to the financial manipulators,

the robber barons
of the late 19th century.

These guys are out there,

they're trying to make a buck
by doing nothing.

and they're putting people
out of work.

Kent: Economists agree
that some unemployment,

some hardship is unavoidable,
in the vitally important process

of making the United States
lean and mean again --

what the takeover specialists
call corporate restructuring.

Corporate America needs
some kick now and then

to become
a little bit more efficient,

a little bit less entrenched,

and that will probably
do our economy a lot of good.

Thursday, Goodyear fended off
a hostile takeover bid,

but victory didn't come cheap.

Smith:
Goodyear won by buying back
roughly half its stock

and taking on a huge debt.

Plants were closed
and workers laid off.

The company pays
$1 million a day in interest

to 17 banks worldwide.

These fellas jump out
of the closet, shout "Gotcha,"

and they buy up a company
with its own assets,

dismember it,

and erode the industrial base
of this country.

Maybe we didn't understand
how it all worked,

but we saw a lot of people
losing their jobs

and a few people
getting super-rich

and the vibe of the culture
being "That's cool."

Kent:
How much is enough?

Enough what?

Enough money,
enough power,

enough influence,
enough takeovers?

This is my work.
This is what I do.

Let me do what I do.

It's not a question
of how much. [ Snickers ]

Miller:
It was a week to remember.

Banker's hours
posted on the doors

of savings and loan institutions
in Ohio didn't mean a thing.

The doors were locked.

The run on Ohio's
savings and loans began

when Home State Savings Bank
was besieged by depositors

who demanded their money.

I don't have a whole lot,
and I'm 79 years old,

and, golly, I need that money.

Celeste: I made a decision
after weighing several options

that we had to close all 71

of the privately insured
savings and loan institutions.

Vito: Celeste is faced
with the dilemma of solving

the worst financial crisis
in Ohio history,

a situation that is being called
the worst banking crisis

in the U.S.
since the Depression.

In the deregulatory climate
of the 1980s, savings and loans,

which had traditionally invested
only in mortgages,

were free to invest in pretty
much anything they wanted.

Basically what happened was,
the entire S&L industry

got taken over
by a bunch of entrepreneurs

who saw them as piggy banks.

Abel:
Vernon Savings was shut down
by federal regulators,

saddled with $1.3 billion
in bad loans.

The owner, Don Dixon,
lived a life of private jets,

yachts, and mansions.

They took risks that should've
been untenable for a banker,

and when that all went blooey,

the entire industry
ultimately went belly up.

Well, get in line
so we can have this --

I am in line!
I'm next!

Quiet down!
Man: Guys,
quiet down!

I'm going to disperse
the whole bunch of you.

McCarthy:
This was the third day

of the run on the Old Court
Savings and Loan Association.

The only thing I can do
at this point,

I have no choice --
we have to close.

I don't think it's right.
That's our money.

This year, a record 260 banks
will go bust.

That's almost 800
in the past five years.

Bad loans to the Third World,
bad loans to the oil industry,

bad loans
to real estate developers.

Nocera: One of the reasons
bankers made outrageous loans

was because
of Federal Deposit Insurance.

If the loan went well,
then you rake in the profit.

If the loan went poorly,

then the federal government
picks up the tab.

Collins: With deregulation,
the S&Ls got into

that commercial
real estate market

and lost their shirt.

Pizzo:
All over the United States,

people were building projects

for which
there were no buyers --

mile after mile of these
partially completed condos.

And they're all
on the S&Ls books.

There's something wrong

about the savings and loan
industry today.

And it isn't me.

Charles Keating was a lawyer
who got into banking

and was able to buy
a savings and loan.

Kroft: When Keating bought
Lincoln Savings and Loan

of Irvine, California, he used
it as a private piggy bank

for his own ambitions,
like the Phoenician Hotel,

which cost $500,000 per room
to build.

That hotel
is a magnificent investment

for savings and loan's dollars.

No question about it.

The real problem is, when
our appraisers looked at it,

they said, "Eh,
it's not such a bad hotel,

but it's worth $200 million,
not $300 million.

Pizzo: Bill Black was
one of the chief regulators

at the Federal Home
Loan Bank Board,

who was really the guy who
spearheaded going after Keating.

Black:
We discovered likely fraud --

just really basic things
that no honest bankers would do.

"The examiners looked
at 52 real estate loans

that Lincoln had made...

There were no credit reports
on the borrowers in all 52."

And on top of that,
Charles Keating

has Lincoln Savings
sell uninsured junk bonds,

and he targets the widows
in the retirement community.

Goldin:
There were 23,000 customers

who would buy $250 million
of these bonds.

We had sold our home
in Sherman Oaks.

My husband had had a stroke.

We moved down here,

went to Lincoln Savings
down here.

Goldin:
How much is your debenture?

You really
want to know?

Yes.

It was $30,000, and for us,
that was quite a bit.

[ Crowd murmuring ]

"Capitalize on this,"
the bond salesmen were told.

"The weak, meek, and ignorant
are always good targets."

The regulators were looking
at this and saying, you know,

"This guy is a disaster, man.
We have got to stop this."

But by that time,

Keating had a construction
company in Arizona,

he had thrifts in California.

His tentacles sprayed out
to several states,

so he was able to call on
congressmen and senators

like that and say, "Hey,
get these dogs off my back."

This morning, the S&L crisis
goes to Capitol Hill.

The Senate Ethics Committee

is looking into charges
against five senators

accused of intervening
with federal banking officials

on behalf
of S&L owner Charles Keating.

The so-called Keating Five
are Republican John McCain

and Democrats Alan Cranston,
John Glenn,

Donald Regal,
and Dennis DeConcini.

The Keating Five reportedly
received a total of $1.3 million

in campaign contributions
or donations to favorite causes.

Former bank board chairman
Edwin Gray says the senators

tried to subvert
the regulatory process.

I was told to come alone.

I did.

Kroft:
Did you find that unusual?

[ Scoffs ] Absolutely.

Never happened before.

The whole time
I was in Washington,

I never saw that.

No witnesses?

No. No witnesses.

Deniability perfectly built into
the meeting.

Black: They said
they wanted us not to take

the enforcement action
against Lincoln Savings.

The only thing
that got them to back off

is when we finally said, "We're
making criminal referrals.

You're going to bat
for criminals."

Mitchell: Now awaiting trial
on charges of criminal fraud,

Keating has refused
to testify to the Senate.

McCain:
Was there something wrong
with five senators meeting?

Yes, it's a bad appearance.

But the real question is,

Did John McCain
abuse his office?

The evidence indicates
clearly "No."

Brinkley: The Keating Five
became a symbol of the '80s,

'cause it's a group
of distinguished U.S. senators

that are accused
of taking bribe money.

They get off the hook
eventually,

but it really rocked the country
because it showed that not only

was corporate America
being questioned for corruption,

but the U.S. Senate seemed to be
a beehive of bribery.

One question among the many
raised in recent weeks

had to do with
whether my financial support

in any way influenced
several political figures

who took up my cause.

I want to say in the most
forceful way that I can --

I certainly hope so.

Robinson: The financial scandal
causing increasing concern

involves investors who make
killings on Wall Street

not because of luck or skill,

but because
of inside information

not available to anyone else.

Martin:
This coded document might be
a secret earnings report

showing disastrous losses

or a confidential assessment
of future profits.

If you are one of the 32 million
Americans who own stock,

such information can either cost
you money or earn you money --

perhaps millions of dollars --
if you find it out first.

In either case, it is illegal.

The single biggest currency
on Wall Street

has always been information.

And in the '80s,

that information
was trading back and forth.

And investors
were talking to their buddies

they went to business school
and law school with,

who were actually working
on these deals, to find out.

It was pervasive.

Feldman: The Security
and Exchange Commission,

which monitors potential abuses,

says that currently,
penalties aren't strict enough.

This is a serious course
of misconduct,

and that at present,
the sanction is simply akin

to asking someone
to put the cookies

back in the cookie jar.

In tonight's "Money Matters,"

the biggest
insider stock trading case ever.

Gumbel: Investment banker
Dennis Levine

collected $12.5 million
in illegal profits.

He did it
by getting advance knowledge

of 54 pending takeovers.

Then from a phone booth,

he would call an accomplice
in the Bahamas,

who would buy stocks in the
names of two dummy corporations,

which Levine had set up
in Panama.

Aug: The Levine case
was the first time

the SEC's been able
to nail down insider trading

by one of Wall Street's
big dealmakers --

somebody with
a $1 million-a-year salary,

which, apparently,
wasn't enough.

Brady: Insider trading could
become Wall Street's Watergate.

Cassidy: Plea bargaining is now
under way with Dennis Levine.

Authorities might be able to
develop a list of new suspects.

Carberry:
We started the investigation,

and once his lawyer advised him
his interest to cooperate,

he would give you
the information.

To him,
it was just another deal.

I think the judge made it clear

that he would have given
Mr. Levine a heavier sentence,

except for the cooperation.

Baird: Dennis Levine was one guy
doing insider trading,

and that's not something
that's new.

But what Dennis Levine did
was lead to Ivan Boesky.

The Securities and Exchange
Commission

stunned Wall Street today
when it announced

that investor Ivan Boesky
has been fined

the largest penalty ever
for insider stock trading,

and he has been barred now
from the securities industry.

Monsees:
Boesky did what he publicly
claimed he would never do --

use insider information
to buy huge blocks of stock

in companies secretly involved
in takeover deals.

Ivan Boesky
was an out-and-out crook,

handing bags of cash to people

who would give him
inside information.

If we had capital punishment
for white-collar crimes,

I'd say
he'd be a prime candidate.

Stourton:
Ivan Boesky arrived in court
to hear himself described

as a man whose arrogance
has been stripped away.

There's no doubt that the man
has become a symbol

of what's wrong
with Wall Street.

The news
of the Boesky indictment

was like the bombshell
of the decade on Wall Street.

What do we call greed
the day before

an indictment is filed,
if you get my meaning?

I'm afraid recently,
we've called it success --

that some of the people
who have now turned out

to have been engaged
in criminal activity,

such as Ivan Boesky,
were being hailed as heroes

while they were
at the peak of their careers.

Green: Millions
of America's small investors

have been appalled
at the Boesky affair.

I think they should get every
one of them, put them in jail.

Jensen: Since 1984,

there had been more than 48
cases of insider trading

brought by New York's
U.S. Attorney Rudolph Giuliani.

Back then, Rudy had the aura,
essentially, of being

the best man in law enforcement
without a cape.

Maybe we can't catch
all of them,

but we sure as heck
can deliver a message,

which is if you do get caught,
you are gonna lose your liberty.

You're gonna go to prison.

Today, as the prospect of a much
wider scandal seems certain,

the market was off
more than 40 points.

This after it was learned
that Ivan Boesky was talking,

and then some.

Braver: As one
former SEC official put it,

this is like arresting
the madam of a brothel

and finding
her private book of clients.

This guy Boesky takes a fall,
and all over Wall Street,

they're practically
jumping out windows.

It comes out that he's been
taping his phone calls,

and maybe his private talks,
for three months.

And Wall Street big shots
begin wetting their --

Well, you get the idea.

Stewart: Of course
Ivan Boesky was guilty.

There was gonna be no defense.
All he had was bargaining power.

Who could he deliver?

Well,
let me ask you this.

Levine was a fish,
Boesky was a shark.

Who's the whale
that they're gonna catch?

I don't know.

Drexel Burnham?

Well, that's --
that's possible.

In the middle of all of this
is Drexel Burnham Lambert --

until a few years ago,
a little-known Wall Street firm.

Then it shot to the top
of this high-stakes world

by specializing
in so-called junk bonds --

high-interest
but also high-risk.

Aug:
The commission says Drexel

and the head of its junk bond
department, Michael Milken,

made a secret deal

with convicted stock swindler
Ivan Boesky

to make millions of dollars
illegally.

Krulwich: For example,

California company Wix
came to Milken's firm

and told them
that it was planning a takeover.

The government charges
that Milken, in effect,

went and whispered that secret
to Ivan Boesky in New York.

So Boesky bought the stock
before it went up,

made millions, shared
the profits with Milken's firm,

but the bottom line is,

Milken betrayed his client,
charged a million-dollar fee,

and then secretly earned
$6.5 million more

at the client's expense.

Levine:
Authorities are worried

that further disclosures
resulting from the Boesky affair

may weaken public confidence
in financial markets

and weaken the markets
themselves.

[ Indistinct talking ]

I just came from inside,
and it looks like a madhouse.

I guess
the bull market's over, huh?

It's a bloodbath down there.

Brady: They're calling it
The Monday Massacre --

the worst drop
in Wall Street history.

Well, I'd call it
the nearest thing to a meltdown

I ever want to see.

Brady: By the closing bell,

the Dow Jones Industrial Average
was down more than 500 points.

This was a crash that people
hadn't seen, frankly,

since the Great Depression.

No one had seen the stock market
fall that quickly that fast.

Brokaw: Paper losses --
more than $500 billion.

October 19, 1987 --
Wall Street's Black Monday.

McLean: That crash
was one of the first signs

of how dangerous
this new era could be --

that what the market had given,
the market could take away,

and it could take it away
really, really quickly.

Lefevre: There's only
two emotions in Wall Street.

One's fear,
and the other's greed.

Usually, we have an excess
of one or the other.

We have now, I think,
an excess of fear.

We will have a recession.
We always do.

It's just a question of when.

My guess is it's probably 1989
rather than 1987.

A little present
for the new president.

Presidents always seem
to manage to get that

as their gift
after the inaugurals.

I promise you, if Congress
tries to raise the taxes

when I'm president --
and you know they will --

I'll say no.

They'll try one more time,
and I'll say no.

And if they try a third time...

...I'll stare them
right in the eye...

...and I'm gonna say to them,
"Read..."

"...my...lips.

No...new...taxes!"

[ Cheers and applause ]

Troy: In 1988,
George H.W. Bush is running

to take on the Reagan mantle.

"Read my lips -- no new taxes."

Miklaszewksi: When Ronald Reagan
left The White House in January,

he also left George Bush
holding the bag --

filled with an assortment
of staggering problems.

Bierbauer:
When the president calls,
some come running.

All agree the savings and loan
crisis is an urgent problem.

Brady:
Could the S&Ls be bailed out
without a tax increase?

Is there any other way
to do it?

I don't think there is,

and I think that's becoming
the conclusion of most people.

Pizzo:
Bush had to fill this smoking
hole left by Reagan for him,

and the only way to do that
was to pass new legislation,

because now we had to start
dipping into taxpayer money.

Bierbauer:
Senators say the only bailout
will be for depositors,

not for bad bankers.

No one needs to worry
about one nickel of their money

in these institutions.

This legislation says to tens
of millions of S&L depositors,

"You will not be the victim
of others' mistakes."

Thank you all very much.

And now I'm proud
to sign this monster.

Reporter: Essentially,
George Bush is covering

the biggest overdraft
in history.

[ Applause ]

[ Laughter ]

Bush caves.
He raises taxes.

That kills him politically
but saves America economically.

Listen carefully
to this number --

$500 billion.

That's the latest estimate
of what the failure

of hundreds of federally insured
savings and loans

will eventually cost
American taxpayers.

Reporter: Mr. Keating,
how soon can you make bail?

Man: No questions.

Healy:
The once-rapid growth

of Keating's now-failed
Lincoln Savings of California

had been fueled by the sale of
a quarter billion dollars' worth

of uninsured
and now worthless bonds --

the majority bought by seniors,
many losing their life savings.

I need my money!
Give it to me right now!

Black: Charles Keating
was convicted in two trials,

but both of those verdicts
were overturned,

and then he pled guilty
to avoid a retrial

and was allowed out
for time served.

Stewart:
The climate had gone

from celebrating the excesses
of Wall Street

to condemning them
pretty quickly.

Reporter: Mr. Milken!

Jennings: Tonight's headline --
Milken pleads guilty

in what may be the largest
individual case of fraud

ever to rock Wall Street --
a case which ended

in a plea bargain
with the government.

Frank: Judge Kimba Wood said

Milken's crimes merited
his removal from society.

She sentenced
the one-time king of Wall Street

to 10 years in prison.

Stewart: He didn't end up
serving anywhere near that.

He did go to jail
for just under two years.

But I'm confident when he left,

he was at a minimum
a billionaire,

and quite possibly
a multi-billionaire.

Jensen: The game of Monopoly
could have been invented

for Donald Trump.

But Monopoly is a tricky game.

When you borrow $2 billion

and the economy
goes into a tailspin

and you can't pay the interest
on your loans,

the bankers move in.

Donald's $100 million yacht

goes to the Boston Safe Deposit
and Trust Company.

His half-interest
in the Grand Hyatt Hotel

goes to Bankers Trust.

His Trump Shuttle
goes to Northwest Airlines.

The man who was
the darling of the '80s

is seen as a man in trouble,
and he knows it.

McInerney:
Insofar as we can say

that the '80s was a period
of hedonism and excess,

then the end of the decade
was the hangover.

It's more like the rich
are taking their tumble now.

O'Reilly:
Leona and Harry Helmsley,

one of the richest couples
in the world,

were today treated
as common criminals,

booked in Manhattan
on 139 counts of fraud,

tax evasion, and extortion.

The government charges
that the Helmsleys renovated

their $11 million
Connecticut estate

and wrote the cost off as a
business expense on their taxes.

Clayton:
A former housekeeper said
Mrs. Helmsley once told her,

"We don't pay taxes.
Only little people pay taxes."

Helmsley was sentenced
to four years in prison,

given a $7 million fine,

and ordered to serve
750 hours of community service.

For some,
the sentence was too light.

I have done nothing wrong.
I'm innocent.

My only crime
is that I'm Leona Helmsley.

No matter how many white-collar
thieves get sent away,

no matter how long
they're locked up,

the public
will still be paying for this

long after they're out.

So, what did the 1980s
add up to?

We put that question
to a fair number of people,

and more than 95% of them
said simply,

"It was the decade of greed."

Well, we learned
that greed may be good,

but too much greed is bad

and that sometimes,

people on Wall Street
get a little too greedy.

But they learn their lesson,

and they would
never do it again.

Some argue that today's bright
spotlight on unethical behavior

has exaggerated the problem.

But there's no denying
the problem is real.

And if we excuse
unethical conduct

by saying
"Well, everyone does it"

or "It's really okay
unless you get caught"

or "It's not against the law,"
we miss the point

of why it's important
we not do it period.

The point may be
no less than national survival

as a people who can
live together honorably.

If we let
lying, cheating, and stealing

become an accepted way of life,

it's not just a few dollars
that'll be lost.

It's the spirit of the country
that would be lost.

The decision is ours.