Jimmy Cayne Almost Died Trying to Save Bear Stearns

Photo: Patrick McMullan

We'd like to imagine that William D. Cohan's epic interview with Jimmy Cayne in Fortune today took place in the former Bear Stearns CEO's $27.4 million Plaza apartment. The two have just viewed a pirated copy of Pineapple Express on the big screen, and now Cayne's ready to talk. "This story about smoking marijuana with some woman in a bathroom at a tournament site is pure fiction," the chief says, sputtering as he exhales. He hands Cohan the doobie. It was actually behind Denny's, Cayne explains, and afterward he was like, "I'm gonna eat 50 eggs," like Paul Newman in Cool Hand Luke, but when they got in there, he actually had a hankering for waffles — but anyway Cohan bungles his tape recorder during that part because he's baked. He manages to get it working by the time Cayne, his inhibitions lowered by the powers of Maui Waui, really opens up and tells him about how he almost died this past September when he got sepsis in his prostate, and about his struggles with commercial airlines (like he doesn't know they exist), and a couple of embarrassing stories about Alan "Ace" Greenberg, since he's still pretty cheesed off at Alan for charging him sucker prices when he dumped his stock back in March. Anyway here's one: Back in the eighties, Cayne says, Greenberg was "increasingly concerned about the risk of contracting AIDS" (per Fortune; we imagine Cayne said this in a more colorful manner) and so:

"He decides he's going to get married," Cayne says. "And he's one of the guys that's dating Barbara Walters … He says to me, 'I've decided I'm going to marry Barbara Walters.' The very next day in the papers she's engaged to Merv Adelson. I never said a word. Now normally — you know, if it was one of my buddies — I'd say, you know, 'Pretty good call there, pal. You're marrying her, except that she's marrying somebody else … That's called bigamy.'"


Other things he told Cohan:

• On September 11, when Bear's stock was nosediving after the implosion of two hedge funds; Cayne went into the hospital with a prostate infection. Doctors gave him a 50/50 chance of survival. He kept the whole thing quiet because he feared a public disclosure about his health could further damage the firm.

• Growing up, Cayne wanted to be a "bookie." Instead he drove a cab, sold photocopiers, and worked for his father-in-law's scrap-iron business. He came to New York with the aim of becoming a professional bridge player.

• When he met his now-wife, she told him to "get a serious job, or get a new girlfriend."

• He bonded with Alan Greenberg over their shared love of bridge, but he refused to call him "Ace" and billed those who used the nickname in his presence $100.

• He bonded with Joe Lewis, on whom he unloaded $860.4 million worth of shares last September, over "a shared love of gin rummy."

• Why he resigned in January: "The options were limited," Cayne says. "When you become roadkill, when you happen to have lost some weight and you're not really healthy, but you know one thing — you know that you have worked your ass off and you're not smart enough to know the answer — that's tough."

• He was late to the meeting where Bear decided to sell to JPMorgan because he couldn't find a private plane to take him to New York from Detroit, where he was playing in a bridge tournament. (He placed sixteenth.)

• He's sorry about all that, by the way: "I didn't stop it. I didn't rein in the leverage."

• But actually he doesn't think it was totally his fault. He thinks principals at Goldman Sachs, Paulson & Co., and Dallas-based Hayman Capital conspired to bring down Bear Stearns.

Then he was like, "Dude, you want a fresh-baked chocolate-chip cookie? I got some."

The Trials of Jimmy Cayne [Fortune]