Goldman’s Thain, who had the most intimate knowledge of Long-Term, described the portfolio risks. The group agreed that any investment should be in the form of equity, but no one beyond the four lead firms was ready to commit. Most of the banks thought they would lose less than $250 million if Long-Term failed; why throw good money after bad? Allison said that the fallout could be truly scary, even worse than after Russia. Long-Term had $100 billion of assets and $1 trillion in notional derivative exposure, he reminded the group.
