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The Autumn of the I-Banker


Throughout downtown Manhattan, men like him are braying for their money. His own portfolio is made up of sovereign and corporate debt, equities, and derivatives from the U.S. to Europe to Asia. He travels to check on his holdings on a regular basis, in between social trips to Paris for the weekend. “On British Airways, I’m one of the guys in first class to whom the stewardesses have to pay special attention,” he says. “I deal with the fuckwits in these countries during the week, and steal weekends on both sides.” He strides around the globe, taking note of the way people are living in each country, their dress, their choice of purchases, divining the truth about their economy’s inflation. The demographics in these countries are on the side of growth—short Western Europe now!—and they want to live the good life. “There’s massive concentrations of wealth embracing massive leverage, all chasing the new BMWs and iPhones,” he thunders.

Now, the bosses are insisting that he sell his bonds, immediately. “Every day I get calls from investors begging, ‘Please, can you buy this from me,’ and normally I’m good for it, but when the shit hits the fan, I can’t do that,” he says. “So I’m like, ‘Fuck no, I can’t buy it. But hey, can I sell you more?’ We are in the midst of mass confusion. The system is broken.” It’s a global margin call, with selling begetting more selling. The billion-dollar portfolio he has created for the bank is dwindling quickly. “In three years, this thing would be a gold mine!” he says, his broad, flat face turning hot, and his eyes blazing with furious resentment. “It’s a massive empire.” If he can only keep the barbarians at the gate ...

The streets of Soho are dark as he wanders home, past the design store Moss—“The margins on that stuff are just preposterous”—and several shops displaying kids’ couture. “Two foot mannequins,” he barks. “We should’ve known we were in trouble when Prince Street began to bring in two-foot mannequins.”

His phone rings: it’s a hotel where his girlfriend has been staying. “I just got a margin call from them,” he says, slipping the phone into his pocket. “Per their new policy.” He snorts. “Now, when your bill goes over a few thousand bucks, they’re charging it to your card.”

In this midst of the esprit de corps of the Street, there’s always been a nagging question—what do I do, exactly? “I don’t make anything,” says one trader. “I could go to cooking school in Thailand. Or I could become an artist. I want to do something real.” These existential questions demand answers. They might not have made anything, and now there might not be anything left to be made. Get out your gold bars and duct tape, and let’s take a conceptual-level trip—what is your $20 worth? It’s only worth something if it buys a cab ride or a pack of smokes. A bank in California already screwed the depositors—‘Oh, you want your $100,000 back?’ they said. ‘Well, here’s a bagel.’ “We’re talking about, ‘Want milk? Bring me a cow,’ ” says a hedgie. “We’re talking about going to Costco and your AmEx doesn’t work. We’re talking, ‘I’m not taking a check from that bank.’”

And whose fault is it, anyway? “The smartest people in the world built all these sophisticated products and convinced us there was no risk, and now it’s like, ‘What the hell happened?’” says a wealth investment adviser. “Well, they were wrong.” His voice begins to rise. “So now they tell us, ‘Sorry, I was wrong. I meant to replace your hip, and instead I took out your heart.’ Can you imagine your doctor saying that?” He pauses. “If I say, ‘Sorry, I was wrong,’ the repercussions are dramatic—I get sued for everything I have! ‘I know you were relying on me to invest for your future, but I decided to buy all one-penny stocks and not tell you. Whoops. Sorry, I was wrong.’”

Last Friday, the trader returned to Jersey from a few days in D.C. He lives in an elegant house on a quiet cul-de-sac, with a backyard of endless green and porch awnings trimmed in blue and white. We sat in his mauve-colored parlor room on formal yellow couches, embroidered with bluebirds. His wife, tall and blonde, strides by with his daughter, who is on her way to the spa. The house is paid off. “I still pay my mortgage on my vacation home,” he says, a little uncomfortably. He’s getting tattooed in the market, but he doesn’t want to go short—he has a family, and he can’t take on that kind of risk, plus he’s an optimist. There’s a part of him that doesn’t take this drama too seriously. “I mean, one day I can tell my grandkids, ‘Turn to page 68 in that history book, where it says that in 2008 the U.S. experienced the worst recession in history,’ ” he says with a sheepish grin. “And I’ll say, ‘What do you want to know? I know everything about it.’ ”

He’s starting to hire low-to-mid-level managers, to help the Treasury Department with the bailout. “I get a ton of calls asking about what it’s like to work for the government,” he says. “I got a call from a guy in Florida earlier today, whom I worked with at Citi. He’s done, and he wants to know if the government wants a consultant.” He raises his palms. “Hey, it’s a stable paycheck and a guarantee of benefits.” There are some things he can’t get used to about D.C., like having to move around to different hotels, according to whichever one has subsidized rooms at the government limit of $150 a day, or not having an expense account. “I just pay for whatever I want and eat the bill,” he says. Then there’s the way that everyone’s office dimensions are based on their rank, and no one talks to each other. “You can go for days without talking to someone in that place,” he marvels. He and his boss tore down the wall between them, and someone reported them. “People make careers out of looking into your personal life down there,” he says. “On the street, you go after other guys’ P&L, but you never go after them personally.”

He drained a can of Coke, then his mind began to wander. He was stressed about being out of the flow, getting stale. His friends are raising hundreds of millions of dollars at new funds, to buy distressed loans and other vulnerable assets. They’ve told him to hang in D.C. as long as he can, that the next generation of whatever is going to generate fast cash hasn’t been put together yet. But he was eager to figure out a way to reinvent himself. “If I’m totally honest with myself, I’m happiest when I’m making money,” he says, lacing his hands together. “We’re just built differently on the Street—we never give up.” He looks out the window, at his freshly cut lawn. “If I had it to do all over again, you know what?” he says. “I would’ve lost more. I would’ve been bigger.”


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