Commentary

Brett Cenkus
Traders Magazine Online News

Trump Won't Kill America, Bitcoin Will

In this shared piece, author Brett Cenkus argues that nation-states will cease to exist not because of a who, but a what - and it's already here.

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August 31, 2001

The Great Wall Street Swindle: A Legendary Trader Who's Seen It All, And Done It All, Now Tells It

By Brian O'Connell

Also, Salim doesn't explain how someone so smart, so well tuned in to the scams of Wall Street, allowed himself to be hoodwinked on The Lakes of Arlington luxury housing development. Salim, a great investor and trader, thought he could make tens of millions of dollars on a project that he was warned could easily go over budget. He ignored the warnings. Eventually, Salim is in over his head and has to cut in CS First Boston for a piece of the deal. Its financial backing, he believes, will ensure that the project will be completed.

CS First Boston double-crosses him, Salim claims, and guts the projects. That means tens of millions of dollars of Salim's investment goes down the drain. Salim is angry. He won't let "the suspender boys" get away with it. He'll sue, by gosh. His attorneys, sifting through the documents he signed with CS First Boston, find a smoking gun agreement that basically holds the investment bank harmless no matter what it does. It allows no legal recourse. Salim's name is on the document. There is no doubt he had signed it. Suddenly, the furious Salim hasn't a leg to stand on.

Marx Brothers

His account of this mess is fascinating: "At the closing, the CSFB attorneys asked me to sign two blank pages, telling me these belonged to documents that were copied and would be attached later. But they assured me it would have no effect on the deal," (pages 237) he writes. Salim's situation was so zany that it reminds one of a line out of a Marx Brothers movie in which someone is asked to sign a contract. Groucho: "Hey, that's a blank sheet!" Chico: "That's ok. We fill it in later."

Salim's excuse is that the CS First Boston attorneys, who were not there to protect his interests (and where were Salim's attorneys?), told him that this was, "just boilerplate, routine stuff." That routine stuff cost Salim $14 million. How could this have ever happened to Salim? He had seen some of the biggest crooks in the business and had seen through their tricks. He had beaten some of them at their own game. Jim Salim is a very smart man. But he is not quite as smart as he thinks he is.