Salomon's Court Summary and Analysis

Buffett convened a meeting of Salomon managers and, one by one, asked them privately who should run the company. Overwhelmingly, they selected Deryck Maughan from their ranks. While Buffett was holding this meeting, he learned that the Treasury Department had just banned Salomon from its auctions. Buffett spent the remainder of the day in conference calls with Treasury officials and Federal Reserve Board Chairman, Alan Greenspan. He plead for grace and time. In the meantime, he also had Salomon's lawyers prepare bankruptcy papers.

On the next day, Secretary of the Treasury, Brady, called Buffett, who updated him on the changes in management and gave promises to fundamentally change Salomon's business practices from the ground up. While Brady was not particularly concerned about the potential demise of Salomon, he did know Buffett. By a strange coincidence, Brady, an MBA from...