Sunday, August 14, 2016

249. Wall Street: A Roman Orgy, Greed, and "Bro Talk"


     Wall Street, that citadel of wealth, has always had a bad press.  Back in 1849 George G. Foster, a New York Tribune journalist, in his anonymously published New York in Slices, hailed it as the great purse-string of America, but went on to decry “the million deceits and degradations and hypocrisies played off there as in some ghostly farce.” 

Wall Street!  Who shall fathom the depth and the rottenness of thy mysteries?  Has Gorgon passed through thy winding labyrinth, turning with his smile every thing to stone – hearts as well as houses?  Art thou not the valley of riches told of by the veracious Sinbad, where millions of diamonds lay glistening like fiery snow, but which was guarded on all sides by poisonous serpents, whose bite was death and whose contact was pollution?

Foster knew his Greek mythology and Arabian Nights, but he also knew Wall Street.  And this was in 1849, before the likes of Daniel Drew and Cornelius Vanderbilt, Jim Fisk and Jay Gould – remembered today as robber barons – had hit their manly stride, manipulating and convulsing markets in their lust for riches and their delight in turning Wall Street and foreign markets upside down.

     Of course all that was back in the nineteenth century, before even a hint of government regulation, back when laissez-faire was played to the absolute limit.  And today?  Let’s have a look.

     By “Wall Street,” as I explained in the previous post, I don’t mean just the street itself, but the whole financial community, whether headquartered literally on Wall Street or in some more remote location, including even—to the indignation of New Yorkers – the barrens of New Jersey, that decidedly unimperial hinterland across the Hudson that constantly schemes to entice businesses away from the Empire State, even while insidiously laying claim to the Statue of Liberty and sending us its hordes not of immigrants but mosquitoes.

     So what about Wall Street, in this larger sense, today?  Let’s begin with Tyco International, a security systems company whose CEO and CFO (chief financial officer) were found guilty here in 2005 of stealing more than $150 million from the firm.  And what had Dennis Kozlowski, the CEO, done with these ill-gotten funds?  Here’s a sampling that came to light at his trial:

·      A $30 million Fifth Avenue apartment
·      A $6,000 gold-and-burgundy shower curtain
·      A $15,000 dog umbrella stand
·      Paintings by Renoir and Monet worth millions
·      A multimillion-dollar oceanfront estate on Nantucket
·      $1 million in 2001 to pay half the cost of the 40th birthday party for the second Mrs. Kozlowski on the island of Sardinia, a party featuring helmeted gladiators to welcome arriving guests, toga-clad waiters crowned with fig wreaths, wine served in chalices, and an ice statue of Michelangelo’s David pissing vodka.  (Mrs. Kozlowski later filed for divorce.)

     Born in Newark, N.J., in 1946 to second-generation Polish-Americans who worked for the city, Mr. Kozlowski was a good example, if not of rags to riches, at least of a rise from modest beginnings to dazzling financial success.  Photos of him show a man in his sixties with an oval-shaped head, quite bald, and a hearty grin.  His lavish life style came to symbolize the decadent luxury of high-living Wall Street and hastened his downfall, since videos of the party were shown to jurors, who saw dancing women and near-naked male models cavorting with guests, and a beaming Kozlowski promising guests a “fun week” with “eating, drinking, whatever.  All the things we’re best known for.” 

     Mr. Kozlowsi’s celebrated “Roman orgy” recalls impresario and financier Jim Fisk’s reputed revels with scantily clad Opera House dancers and free-flowing champagne in the late 1860s, except that those revels may never have happened, whereas Mr. Kozlowski’s are well documented.  The famous shower curtain landed him on the cover of the New York Post under the headline “OINK, OINK.” 

     In a 2007 interview he maintained his innocence, arguing that jurors, hearing that he was making $100,000 a year, must have thought, “ ‘All that money?  He must have done something wrong.’ I think it’s as simple as that.”  After serving eight years, he was paroled in January 2014 and now lives modestly in a two-bedroom rental overlooking the East River with a nondescript white shower curtain and wife #3. 

     But there’s more to Wall Street than living high on the hog.  Cliché though it is, how about greed?  In our capitalist economy, it can take you very far.  My post #150, “Wall Street Greed and Addiction” (October 26, 2014), draws on reminiscences of former hedge-fund trader Sam Polk, published as the article “For the Love of Money” in the New York Times of January 19, 2014.  When, at 22, Polk first walked onto a trading floor in Boston to begin a summer internship, he was dazzled – not by a floor of screaming, frenzied traders, as it was not so long ago – but by the glowing TV screens, high-tech computer monitors, and phone turrets of today.  Instantly he knew that this was what he wanted to do for the rest of his life.

     Three weeks after his internship ended, his girlfriend dumped him, saying, “I don’t like what you’ve become.”  But when, now a trader, he got his first end-of-the-year bonus of $40,000, he was thrilled until, one week later, another trader only four years his senior was hired away by another outfit for $900,000 a year, 22 times the size of his bonus.  Envy consumed him, and the thought of how much money was available.  Four years later, at 25, he was making $1.75 million a year, but he began to notice the greed and selfishness of most traders, and realized that, for all his outsized salary, he wasn’t doing anything useful or necessary to society.  So he got out.

     But he was addicted to greed.  He would wake up in the middle of the night, terrified by the thought of running out of money, of later regretting his giving up his one chance to be someone important.  But in time he overcame his addiction and began speaking in jails and juvenile detention centers about getting sober, and doing other public services to help the underprivileged.  The implied conclusion of his story:  Can Wall Street greed become an addiction?  The answer: yes!

     And from the same reformed hedge-fund trader, Sam Polk, came a more recent article in the Times of July 10, 2016, entitled “How Wall Street Bro Talk Keeps Women Down.”  If the previous post on the difficulties of women wanting a Wall Street career needs confirmation, here it is.  Polk tells of going to dinner with a director and client when he was a bond trader at Bank of America, and hearing the client announce, once the waitress was out of earshot, “I’d like to bend her over the table and give her some meat.”  Polk forced a smile, later fumed because he hadn’t said anything about the comment.  Having heard men objectify women all his life, Polk asserts that this everyday sexism was nothing compared to the “bro talk” he witnessed on Wall Street.  Women have written articles and challenged the norms, but the men have done little or nothing, preferring to be in the “in” crowd, to enjoy the camaraderie of like-minded males.  Success on Wall Street depends on “fitting in,” on becoming one of the guys.  For Polk, Wall Street is not a swashbuckling, take-no-prisoners culture, but a culture of brutal conformity; not to conform is to throw away millions of dollars in future earnings.  Which means, I suspect, that the culture won’t change easily, or soon.

      A personal aside:  I have known since grade school that men talk differently among themselves, broaching matters not mentioned in mixed company.  I learned this when my father took me to his gun club, where sportsmen gathered for trap shooting.  Every once in a while my father would announce to some of his acquaintances there, "I heard a good one the other day."  Then, in a lowered voice so I couldn't hear, he would tell his story to a circle of listeners, who would soon erupt in laughter.  Yes, men at all ages talk differently among themselves.  By my early teens I knew that I could talk books and theater with my mother, and crime, sex, and politics with my father.  But what Sam Polk reports about the "bro talk" of Wall Street seems to cross some hidden line.

     Does the Donald pay taxes?  This is the question posed by the lead article of the Business Section of the New York Times of August 12, 2016.  Of course we don't know, since he hasn't released his tax returns, but the article makes it clear that, as a big-time real estate operator, he could quite legally pay little or no taxes.  Why?  Because the tax code is full of overly generous tax breaks for developers, and he'd be a fool not to take advantage of them.  Which simply supplements my post #157 of December 14, 2014, "Taxes: Who Pays Them and Who Doesn't."  As for who doesn't (mentioned at the end of the post), you might be surprised.

     My poems:  For five acceptable poems, click here and scroll down.  To avoid five terrible poems, don't click here.  For my poem "The Other," inspired by the Orlando massacre, click here.

     My books:  No Place for Normal: New York / Stories from the Most Exciting City in the World, my selection of posts from this blog, has received these awards: the Tenth Annual National Indie Excellence Award for Regional Non-Fiction; first place in the Travel category of the 2015-2016 Reader Views Literary Awards; and Honorable Mention in the Culture category of the Eric Hoffer Book Awards for 2016.  For the Reader Views review by Sheri Hoyte, go here.  As always, the book is available from Amazon and Barnes & Noble.


No Place for Normal: New York / Stories from the Most Exciting City in the World

The Pleasuring of Men (Gival Press, 2011), my historical novel about a young male prostitute in the late 1860s in New York who falls in love with his most difficult client, is likewise available from Amazon and Barnes & Noble.

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     Coming soon:  Forbidden Zones.  What places, past and present, have been denied to New Yorkers, and why.

     ©   2016   Clifford Browder