Today’s scouting report on America’s Dream Team Steven Mnuchin, Secretary of the US Treasury

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Steven Terner Mnuchin
December 21, 1962
New York City, New York
Spouse(s) Heather deForest Crosby (1999–2014)
Domestic partner Louise Linton (engaged)
Children 3

Steven Terner Mnuchin is a former Goldman Sachs partner and senior manager and hedge fund investor. On November 30, 2016, it was announced that Mnuchin would be nominated as Secretary of the Treasury in the coming administration of President-elect Donald Trump.

After he graduated from Yale University, Mnuchin worked for investment bank Goldman Sachs for 17 years, reaching its management committee. After he left the bank in 2002, he worked for and founded a number of hedge funds. During the financial crisis, Mnuchin bought failed house lender IndyMac. He rebuilt the bank as chairman and CEO in the subsequent years under the name OneWest Bank, and sold it in 2015 to CIT Group. Mnuchin joined Trump’s presidential campaign in 2016, and was named national finance chairman for his campaign.

Goldman Sachs
Mnuchin’s first job was as a trainee at investment bank Salomon Brothers in the early 1980s, while still studying at Yale. After he graduated in 1985, he started working for Goldman Sachs, where his father had worked since 1957. He started at the mortgage department, and became a partner at Goldman in 1994. Until he left the company in 2002, Mnuchin held the following positions as a partner.

November 1994 – December 1998: Head of the Mortgage Securities Department
December 1998 – November 1999: Overseeing mortgages, U.S. governments, money markets, and municipals at the “Fixed Income, Currency and Commodities Division”
December 1999 – February 2001: Member of the Executive Committee and co-head of the Technology Operating Committee
February 2001 – December 2001: Executive Vice President and co-Chief Information Officer
December 2001 – 2002: Executive Vice President, member of the Management Committee, and Chief Information Officer

According to the 2001 Goldman Sachs Form 10-K, Mnuchin served as a member of the development board of Yale University, as board member of the Riverdale Country School, as member of the national board and senior member of the non-profit youth organization Junior Achievement, to which he had donated money, and as a board member of the Hirshhorn Museum and Sculpture Garden. He left Goldman Sachs in 2002 after 17 years of employment, with an estimated $46 million of its stock and $12.6 million that he received in the months prior to his departure.

Hedge funds
After he left Goldman Sachs in 2002, Mnuchin briefly worked as vice-chairman of hedge fund ESL Investments, that is owned by his Yale roommate Edward Lampert. The following year, he established the company SFM Capital Management together with financier George Soros. Mnuchin founded a hedge fund called Dune Capital Managment, named for a spot near his house in the Hamptons, in 2004 with two ex-Goldman partners. After its founding, Mnuchin served as the CEO of the company. The firm invested in at least two Donald Trump projects and, in one of them, was sued by Trump before a settlement was reached.

When Merrill Lynch was selling a portfolio of residential mortgage-backed CDOs during the financial crisis, Mnuchin investigated buying the portfolio, but was outbid by private equity Lone Star Funds. It was sold for $6.7 billion.

OneWest
A group led by Mnuchin bought California-based house lender IndyMac for $1.55 billion in 2009 from the FDIC. The house lender had been taken over by the FDIC in 2008 after it got into financial problems during the financial crisis. Mnuchin’s group, that he compiled in December 2008, included George Soros, hedge fund manager John Paulson, former Goldman Sachs executive Chris Flowers, and Michael Dell, the founder and CEO of Dell. The FDIC agreed to hold on to some of the more problematic assets of the bank, and signed a loss-sharing agreement, that would go into effect if losses would surpass 30%. The main possessions of IndyMac were $23.5 billion in commercial loans, mortgages, and mortgage-backed securities. After purchasing the bank, that was renamed OneWest Bank, Mnuchin served as CEO and chairman.

As the CEO of OneWest, Mnuchin bought several other failed banks, namely First Federal Bank of California in 2009 and La Jolla Bank in 2010. Furthermore, OneWest bought a portfolio belonging to Citi Holdings for $1.4 billion. In 2015, Mnuchin sold OneWest to CIT Group for $3.4 billion, twice as much as Mnuchin paid for the bank in 2009. Since he had bought the bank, he had turned it into the largest bank of Southern California with assets worth $27 billion. After the acquisition, Mnuchin remained at the bank, and became member of CIT Group’s board.

Motion pictures

In 2004, he founded RatPac-Dune Entertainment as a side business, which was the financier of a number of notable films, including the X-Men film franchise and Avatar.

In Hollywood, Mnuchin, along with film producer Brett Ratner and financier James Packer, working with RatPac-Dune Entertainment, produced American Sniper and Mad Max: Fury Road. Mnuchin was co-chairman of the trio’s movie company, Relativity Media, but left before it went bankrupt. A source close to the company said that he had resigned because of the potential for a conflict of interest between his duties at Relativity and OneWest.

Mnuchin worked with RNC counterpart Lew Eisenberg on a late-developing joint operation for the committee and the Trump campaign. The late-summer fundraising goal was $500 million dollars. The New York Times described his role during the campaign as “relatively behind the scenes,” and the newspaper noticed he never “seemed to seek the spotlight.” During an interview, Mnuchin said that because of his connection to the Trump campaign “a lot of people in California and New York wanted to stop being friends.” After Donald Trump won the election, he announced Mnuchin would join the transition team on November 11.

Views
In an interview in November 30 on CNBC Mnuchin called it the Trump administration’s job to “make sure that the average American has wage increases and good jobs.” Furthermore, he said his priority was getting a sustained growth of GDP of three or four percent. He said in order to get there “our number one priority is tax reform.” Mnuchin said he would reduce corporate taxes to 15%, cut taxes for the middle class, and simplify the tax system. When asked about trade, he said he believed in trade deals with individual countries, as opposed to regional trade deals. About Trump’s deal with Carrier Air Conditioning to prevent jobs from going to Mexico, Mnuchin said “this president […] is gonna have open communication with business leaders.” Furthermore, he said he wants to “strip back parts of Dodd–Frank,” because he argued it was too complicated, and it prevented banks from lending. He called the stripping back of Dodd–Frank “the number one priority on the regulatory side.”

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