The chairman of Salomon Brothers was also familiar to readers of the social columns of newspapers and magazines. By 1991 Salomon was said to be the world's most profitable corporation per employee. But after a treasury bond rigging scandal Gutfreund resigned in 1991. He felt like a fall guy. His parting words as he left the final meeting were: "Apologies don't mean shit." Eight years on Gutfreund, who turns 70 this year, runs a corporate advisory firm with two assistants. He speaks to Philip Eade from the office above New York's Central Park about his early days on Wall Street, leaving Salomon Brothers and the truth about that hand of liar's poker.
In the 1980s, you were called a "world-class financial celebrity". How did you see yourself?
As a very lucky fellow. I was part of a very good organization and by virtue of that job I got to meet some of the more successful people in financial services and industry in general in different parts of the world and that's a treat. By virtue of my position, a lot of doors were opened to me. That's a nice thing.
Looking back, how do you feel about leaving Salomon Brothers?
I had 38 great years. The last seven or eight haven't been as good.
When I left Salomon in 1991, it was under a cloud. There had been a scandal which I was not the perpetrator of, but as the CEO I felt accountable. This was turned by the media into the perception that there may have been some guilt there. So although this was not the case, I was left tarnished.
I choose not to look back because if I dwell on inequity or my mistakes or my non-forthcomings, whatever it was, that would not be a useful exercise. I had the rest of my life to live, and the rest of my life was going to be different. I was cut off, totally, for a variety of reasons, some of which were my own doing. I felt that it was in Salomon's interest to be totally remote from me, and it was.
I'd asked Warren Buffett to come in as a temporary CEO and that worked. But because for some people I was a useful means of expressing their displeasure in the short run, I became demonized. I had never been particularly interested in the media. Nor had I been particularly interested in pushing my own reputation forward.
Did you deliberately sever your ties with the people at Salomon?
I did. There was no contact. It was my choice and theirs.
And that included with Buffett?
I talked to Warren a few times but we had a fundamental disagreement about what I thought I was owed having worked there 38 years - not very large [amounts of] money by today's standards. They cancelled all my options which I had never cashed in and some stock awards. So I lost a huge amount of money for me, and then I fought when they didn't want to settle on the terms that I thought were appropriate and I lost that. But that was the environment of the time.
So when you talk about looking back, why should I dwell on something so painful, so unfair in my view? I had to re-establish a life for myself. Obviously, you look forward but you're not stupid enough to forget the past. You don't make the same mistakes repeatedly. But again, what useful purpose does it serve to rehash something like that or to rehash [the story of] Paul Mozer who was the fellow who caused this debacle at Salomon, or the attitude of Warren subsequently, playing God on High.
Gerry Corrigan at the Fed said publicly through spokesmen that they never asked for my resignation. That was my choice. Warren spun the story, but Warren is a master at handling the media and I've never spent the time to cultivate the media. I felt if I did a good job that would suffice. I was wrong.
What do you think the episode said about Salomon?
It said that the controls were not as good as they should have been. The Federal Reserve did not discover this: we discovered it. The problem was that it was felt that I had not reported quickly enough. It was reported three months later, and it should have been reported immediately. Not as a legal matter, but as a business matter.
If the episode had not happened where would Salomon be today?
I have no idea, but I do believe that it would probably be independent, with a much larger asset-management business.
And I feel that Citigroup, Travellers, Smith Barney, Salomon is too big to manage. I don't see the synergies. I don't see the cross-selling, it's just too big. I don't think it suits the employees particularly because they lose their identity. I don't think it suits the shareholders necessarily, and I certainly don't think it suits the customers. It may suit the management. It's like dealing with the telephone company here: if your telephone's botched up, it's a hell of a job getting it fixed.
And where would you be?
I'd certainly be out of there. I would have expected to have left when I was 65, and had some nice cushy office where I could do whatever I could do to help the company. But I would certainly not have anything to do with the management, and if they'd wanted me 100% out that would have been fine with me.
And you'd be richer
I'd be rich - $50 million or $100 million at least, as opposed to a next-to modest amount. But does it make a hell of a lot of difference to me? No. I'm not going to worry about it.
Tell us something about your childhood and how you chose a career in banking
I grew up in the suburbs of New York City. My father was in the meat business and then the trucking business. At school I was weak in the sciences and strong in English and history, poetry and drama. When I went to college at Oberlon, Ohio that trend accelerated. I ran a drama club which had some success in the summer theatre.