4 - A New Deal

Summary

In the 1930s, a group of New Deal reformers joined the investment bankers and the credit men to refashion the bargaining environment once again. The consensus that emerged during this decade is the focus of the book’s fourth chapter. The New Deal reformers brought their own distinctive understanding of how judges were to oversee negotiations among creditors and their common debtor. They believed that judges had to take steps to ensure that, at every turn, the bargaining process did not slight the rights of passive investors who had neither the information nor the sophistication to bargain on equal terms with Wall Street insiders.