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This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.

Short Answer Questions

1. CMO's are divided into slices, or _____.

2. The Salomon Brothers expense account is used as a _____ compensation system.

3. This person is charged with coordinating all deals on the trading floor.

4. What is jargon for a gamble that is sure to succeed?

5. Gutfreund is treated like a _____ in London.

Short Essay Questions

1. From the moment the Federal Reserve lifted interest rates in October 1979, what happens to the thrifts?

2. What characterizes Stu Willicker's leadership style?

3. Why do costs at Salomon Brothers seem to suddenly matter in 1985?

4. What are some of the bad habits mortgage traders have developed regarding the use of the Salomon Brothers expense account?

5. What are the two kinds of friction at Salomon Brothers?

6. The author is convinced that the worst thing a man can do with a telephone without breaking the law is what?

7. What is a tombstone and how does it apply to the German interest warrant created by the author and Alexander?

8. Why do thrifts come back for more, even though they don't understand what is happening to their loans in the mortgage bond market?

9. What is selling short?

10. Who took the hit for the AT&T bond loss that the author advised Herman on?

Essay Topics

Write an essay for ONE of the following topics:

Essay Topic 1

Describe the training program at Salomon Brothers. How is it perceived by other firms? What is the difference between the people who sit in the front row and the people who sit in the back row of the training sessions? How are the Japanese trainees perceived? How do they perceive themselves? To which speaker does the back row respond favorably? Why?

Essay Topic 2

Compare the personality traits of Lewie Ranieri and Michael Milken. What is the difference between their careers in regards to their respective companies? Compare the amount of money each person made. Why did one make more money than the other?

Essay Topic 3

What happens when the author interviews for Lehman Brothers? Why does he interview for Lehman Brothers? Who comes to interview him? What does he say that affects the outcome of the interview? Why is the author perplexed at the reaction the interviewers have to his answer to their question?

(see the answer keys)

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