The Match King: Ivar Kreuger, The Financial Genius Behind a Century of Wall Street Scandals
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corporations of the day, such as American Telephone and General Electric, and the partners carefully avoided even a hint of self-interest. When James Storrow, Jr, a Harvard graduate from a prominent Boston family and a Lee Higg partner, became the lead banker and advisor to General Motors, he refused to permit the firm to own shares of the company. This policy cost Lee Higg a fortune in missed profits as General Motors shares soared in value, but it preserved the firm’s venerable reputation.
this book was a master of investor psychology, and his various schemes - legitimate and not - captured the imagination of shareholders in the 1920s in the same way dot.com internet ventures, auction rate securities, analyst stock tips, and derivatives backed by subprime mortgages have recently. We tend to think of these kinds of investments as scandalous because ultimately they caused so many people to lose money. But each of them also enriched those who understood what the schemes were designed
seemed too good to be true. The timing was perfect, Morgan was vulnerable, and Lee Higginson was well positioned. It was the idea of a lifetime. Ivar’s speech had done the job. Lee Higg’s partners gave Durant permission to begin soliciting American investors. Durant confronted skepticism at first. Ivar had no track record as an international lender, and he didn’t have any deals lined up. Swedish Match had been an active exporter throughout Europe, and Ivar had developed strong relationships
International Match’s board of directors, and its investment bankers, agreed to everything Ivar asked. Lee Higginson already was more focused on International Match’s next deal than on the details of what was happening within the company. Ivar knew the offshore scheme was bold, and even with Ernst August and Continental in place he was nervous about getting caught. Just days before the gold debenture issue was finalized, Ivar wondered whether wiring money right away was too risky. He informed
losing Berning’s loyalty, so he invited Berning to come to Sweden to meet Anton Wendler and get a better sense of the Swedish audit process. Berning booked a cabin on Berengaria, but Ivar asked him to take a different ship, Homeric, and to meet him first at his flat in Pariser Platz, Berlin.35 Meeting in Berlin was mostly for show, and to give Berning a trip to another country in Europe (albeit without his wife). Ivar showed Berning his apartment and the swanky neighborhood, including the