Extreme Money: Masters of the Universe and the Cult of Risk

10. Private Vices

In the film Rain Man, the institutionalized, autistic savant Raymond Babbit (Dustin Hoffman) informs his brother Charlie Babbit (played by Tom Cruise) that he won’t fly on any airline except Qantas because it had never crashed. Qantas remains a profitable, full-service airline, with its safety record more or less intact. When Ralph Fiennes, the English actor, who was alleged to have been involved in an intimate encounter with a flight attendant in an aircraft toilet, some dubbed the carrier—Quickies available near toilet ask staff.

In 2007 a consortium of private equity investors bid A$11.1 billion ($9.2 billion) for Qantas, around A$8.5 billion ($7 billion) (77 percent) borrowed from banks. LBOs were now private equity and ...