Finance: Salvaging Salomon Brothers

A white knight and his new team fight to keep Solly afloat despite a tide of client desertions

When billionaire financier Warren Buffett announced he was assuming the chairmanship of Salomon Brothers on an interim basis last week, he stepped into a morass that threatened to grow worse for the 81-year-old Wall Street firm before it got better. In fact, Buffett's salvage job began even before he was able to warm his new seat. The Treasury Department, in an attempt to restore confidence in the market, barred Salomon from bidding at further auctions. In a series of telephone calls with vacationing Treasury Secretary Nicholas Brady, Buffett successfully lobbied for leniency. Salomon was permitted to trade, but for its own...

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