Fall from Grace: The Untold Story of Michael Milken
Summary
The reference has not verified this book in detail; the summary states only what the title, author and subject establish.
Bailey wrote this account of Michael Milken during the aftermath of the prosecution. The reference has not verified the book's detailed contents.
The established facts of the case are covered in several books in this reference and can be summarised. Milken built the high-yield bond market at Drexel Burnham Lambert from the late 1970s, starting from research showing that below-investment-grade bonds had been priced to yield more than their default experience justified. He extended this from fallen angels, meaning downgraded bonds of established companies, to original issue high-yield debt used to finance growth companies and later acquisitions and leveraged buyouts. He assembled a network of buyers including savings institutions and insurers. Drexel's highly confident letter gave bidders the credibility to attack much larger companies. Milken was indicted under racketeering provisions, Drexel settled and cooperated, and Milken pleaded guilty in 1990 to six counts of securities and reporting violations, served twenty-two months and paid substantial penalties.
Books written in this period divide sharply between prosecution and defence positions, and this reference contains examples of each: Stein's hostile account, Fischel's defence and Kornbluth's more ambivalent treatment.
Bailey's book was published in 1992 and the reference has not established which position it takes or what original reporting it contains. Readers should verify its stance and sourcing before relying on it, and should read across the competing accounts rather than any single one.
Key takeaways 7
- Milken's original thesis came from research showing below-investment-grade bonds yielded more than their realised default losses justified.
- He extended the market from downgraded bonds of established companies to original issue high-yield debt.
- High-yield financing let bidders without capital attack much larger public companies, which changed corporate control.
- A network of buyers dependent on Milken for their own financing allowed issues to be placed regardless of merit.
- Milken pleaded guilty in 1990 to six counts of securities and reporting violations rather than to insider trading.
- Books published in this period divide sharply between prosecution and defence positions and should be read against each other.
- The reference has not verified this volume's stance or its original reporting, which readers should check before relying on it.
Who should read it
Readers surveying the Milken literature, who should verify this volume's position and sourcing and read across the competing accounts.
Where it sits in the reference 2
Similar books 6
Chosen by shared topics, the entries that hold them, and the people who recommended both.
