The former Bear Stearns CEO speaks out for the first time since the firm's collapse, presenting his version of how things went wrong.
Cayne enjoys a cigar in what his wife calls the "womb room" in their New York City apartment.
At the end of November 2007, Bear Stearns reported the first quarterly loss - of $854 million - in its history after taking a write-down of $1.9 billion on its rapidly deteriorating holdings of mortgage-backed securities and other debt obligations. The write-down shaved 7% off Bear's $12 billion book value. By December the CEO was tired of being a "piñata," so he told his handpicked board he was thinking of retiring.