Tag Archives: stock market

Occupying Wall Street

It’s Monday, July 10, 2006, and I’m wearing a dark suit and pantyhose, standing in a sea of dark suits, all nervous and fidgety.  It’s the first time I’ve worn something from the Misses section at TJ Maxx, and it feels like a personal milestone.  Goodbye, Juniors, with your bedazzled t-shirts and l.e.i. jeans with patches on them: I’m a suit n’ pantyhose woman now.  And why wouldn’t I be, here, in midtown Manhattan, standing in the marbled lobby of a $40 billion company on the first day of my summer internship, the first job to pay me more than minimum wage, the first place where I’ve spent a whopping $89 on a suit jacket to still look like a street urchin in a Brooks Brothers catalog.  I’ve made it, Ma, I’ve made it!

As our group of eighty-or-so interns is herded into the auditorium for orientation, we pass through sleek elevator banks hidden by translucent glass panels, the ultimate markers of lobby opulence.  I never thought I’d end up in this kind of fancy place; in fact, my almost-Marxist teenage self would’ve totally pooh-poohed it: “Ugh, so corporate.  Gross.”  But now, sitting in a plush leather chair, facing a gourmet spread, I’m thoroughly ready to drink the hoity corporate Kool-Aid: drink it, guzzle it, pour it into an IV bag and take it intravenously, whatever.  All I know is that I have just one goal now: do well this summer and get a full-time offer, ‘cause this is where I want to be.  Maybe, just maybe, I could work here for the rest of my life.

“Hello, summer analysts,” the HR rep says. “Welcome to Lehman Brothers.”


My mom always says that you don’t know what you like until you try it.  This is her rationale for why “trying out” Wall Street would be a good idea (although this doesn’t seem to extend to drugs, skydiving, or black guys).  In truth, I’m totally up for it.  All my friends are working in banks, so Wall Street sort of becomes our white-collar pregnancy pact.  We get the chance to live in New York, make money, and piss it away like spoiled-rotten socialites–what could be better?  Plus, there’s a certain prestige that comes with working on the Street: If you manage to land an internship at one of the big investment banks, you earn 50 douche points for Gryffindor, and everyone at Harvard wants to be Head Douche.

So that’s how I end up at Lehman: eager, young, impressionable, and in search of shits and giggles.

After our week-long orientation, I’m placed in the Equity Research group, reporting to a man who is the spitting image of Mr. Bean (perhaps with less charm).  His second-in-command, and the guy who is in charge of dealing with me, is a big, rotund, former offensive lineman who I call Diabetes, but not to his face.  While they’re nice, well-mannered, aromatic men, I get the feeling that despite my best efforts, giggles will be hard to come by.

Once I start the job, Mr. Bean and Diabetes have this crazy notion that I’m actually interested in what they do.  So they regale me with stories about free cash flows and outsize valuations and setting appropriate price targets for the stocks they cover.  Diabetes gives me a stack of research reports to read, which I use to create a little fort in my cubicle to play Berlin Wall (“Left hand, tear down this wall of annual reports!” “Okay, right hand!” *Crash.* And that’s the end of the game).  I find ways to amuse myself, because while Lehman might have a lot of money (in 2006), it’s severely lacking in personality.  At one point I try to joke around with Mr. Bean: “You’re such a lucky guy, getting to play around with all these models.”  Blank stare.  “Like, financial models.”  Blank stare.  “It was a joke.”  Curt nod.  “Okay, if you need me, I’ll be at my desk, trying to draw a pterodactyl in Windows Paint.”

I have a feeling this will be a long summer.


As the weeks go by, I start to understand why bankers have such a high suicide rate.  The job is a depressing combination of number crunching and Powerpoint presentations.  Sometimes the highlight of my day is doing extensive data entry.  Other times, I get the privilege of formatting a chart.  I’m beginning to think that my job can be filled by a seventh-grader with basic typing skills and a knack for bar graphs.

Soon I realize that I can get by with minimal effort as long as I present something that already confirms Mr. Bean’s hypothesis: “You were right again, the lagged NASDAQ index is a better indicator for revenue trades.”  This strategy seems to work well, especially when combined with my flowery new finance vocab.  Still, even though I’m barely working, often eating, and most likely napping in the handicapped stall with the bench in it, I’m in the office past 9 pm every night.  Because despite the Wall Street stranglehold on words like “optimization” and “efficiency”, the mantra of “face time” rules over them all.*

In my last week at Lehman, I’m given an offer to return full-time.  At the start of the summer, I would’ve been ecstatic.  Now, I’m not so sure.  Diabetes takes me out to lunch to discuss “my future at the company.”  His argument is a good one: it’s a great offer, at a prestigious company, in the best city in the world.  But I have spent the last eight weeks painstakingly manufacturing fun in a job I hate.  I know now that no gourmet spread will be able to sway me.

So, I decline my offer.  Two years later, Lehman declares bankruptcy.  I guess it was a good decision.


I never foresaw the economic crisis that would lead to Lehman’s demise.  As much as I like to think that I psychically predicted this, I simply left because I didn’t enjoy the work.  And since that summer, I’ve been detached from the turmoil that’s surrounded Wall Street.  I can sympathize with both the protestors and the good people I used to work for.  Ultimately, though, I hope that both sides can see that we’re in this slog together: We need our banks to efficiently allocate capital, and we need an informed public to keep it in check. We need enthusiastic young people to work hard and kick out those caught napping in the bathroom.

But no matter how much we compromise, everyone—people and institutions—must recognize the human fallacy that can be the source of our problems: it’s much harder to take a stand on your own, and it’s much easier to blindly follow the crowd.  That’s how I ended up shoveling shrimp cocktails into a TJ Maxx power suit, and that’s how our country got stuck in this current financial mess.

When I was at Lehman, our group published a 100-page research report in August 2006.  In the report, we predicted that one of the stocks we covered would be trading at $32 by next year, based on our sophisticated (financial) models.  Diabetes had wondered if we were being too bullish, so Mr. Bean asked me to compare our target to that of the other banks.  After a thorough Bloomberg inquiry, I found that we were right in line with the Street: all the other big firms (Fidelity, Moody’s, Merrill, etc.) were giving targets within spitting distance of $32.  So we went with it, confident that we were in the ballpark.  Make little ripples, not waves, they say.  All these smart people can’t be wrong, right?

A year later, the purported $32 stock was at $3.



*Also, in most big banks, if you work past 8 pm, you can order dinner. If you work past 9, you can get a black car to take you home. So if you’re already there at 7:30, why not stick it out for another half-hour and get some food out of it? Resourcefulness.


Filed under Careers, Economy, Life

Rising to #1 on the Billboard Charts: TARP Commentary from Flo Rida and Britney Spears

Throughout the history of music, we’ve always had a knack for uncovering subliminal messages hidden in our favorite songs. Sometimes the discovery was subtle and unexpected, like playing the Beatles’ record backwards to hear “Paul is dead.” Sometimes the messaging was not as subtle, like hearing Britney Spears beg for someone to “If You Seek Amy” in her new salacious (and radio-censored) song.

Most of the time, pop music is like Brit-Brit: it’s quite literal. Thus when the pop diva asks us to satisfy her penchant for four-letter words, we know what she means. When Beyonce implores the male species to “put a ring on it,” she’s giving our deadbeat boyfriends a pretty clear directive. And when Lady Gaga sings “Just Dance”, well, we…just dance. But for every straight shooter in the music business, there’s always someone out there who just wants to if-you-seek-ay-with our heads.

The following are some examples of masterful, even Shakespearean, trickery; behind the poppy lyrics and tempo beats, we have discovered their true intentions:

volcanoBurnin’ Up (Jonas Brothers): “I’m slipping into the lava / And I’m trying to keep from going under / Baby who turned the temperature hotter / ‘Cause I’m burning up, burning up”

  • Take it literally: The musically-gifted but awfully-coiffed trio is on the precipice of an exploding volcano. An exploding volcano of love.
  • Think about it: If the brothers were to actually slip into lava, they would immediately die. So this song isn’t about love at all; it’s about an extreme fear of love. After all, who wants to burn to death in a pool of flaming magma? Not anyone I know.

akonRight Now (Akon): “I wanna make up right now na na / I wanna make up right now na na / Wish we never broke up right now na na / We need to link up right now na na”

marketcrashRight Round (Flo Rida ft. Katy Perry): “You spin my head right round / Right round / When you go down / When you go down down”

  • Take it literally: So yeah, it sounds like he maaayy be talking about fellatio… Or stripping.  Either way, adult activities.
  • Think about it: It’s a recession, people. And Katy Perry clearly has a thing for girls. So what else is going down down, and making our heads spin right round? Of course… the stock market. The Dow just can’t keep it up, and with all the painful pullbacks, it’s been one wild ride on the Street. There’s nothing sexual about it. And if you seek proof, just ask for Amy.

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It’s Beginning to Feel a Lot Like… a Recession

So it’s official: we’re in a recession. On Monday, the mere confirmation that we’re in a recession caused the Dow to drop 680 points. Did we need more proof? The auto industry has been on the verge of collapse for the past few months. Banks are still on life support, trying to raise capital. And yesterday, Harvard announced that its endowment lost 22% of its value in the past four months, or, oh just $8 billion.

And how are our harbingers of corporate America doing?

  • Google (GOOG), which was approaching $700 at the beginning of this year, is now trading at $280
  • General Electric (GE) is currently trading at $18, a ten-year low, and down from $37 since March
  • Goldman Sachs (GS) closed at $199 in May, a mere six months ago; since then, its stock has fallen 65%, now trading at $68

It is not a good time to be checking your 401(k).

It seems like the complete desecration of the stock market has come painfully fast. So, out of curiosity, I looked up some of the other recessions in this century to see if we saw similar declines in the market. According to the gospel of Wikipedia, these are the official recessions since 1929 that have lasted over two years:

  • 2001-03: Bursting of dot-com bubble, September 11, Enron and Worldcom scandals
  • 1980-81: Result of 1979 energy crisis and tight monetary policy to control inflation
  • 1973-75: High oil prices and Vietnam War leading to stagflation

From Google Finance, I looked at a four year period before and after the recession – I’ve also included the largest % declines in the Dow during this time.





Some things that jump out:

  • With our current recession, it’s only been a year, and the Dow has already lost 36%, or over 4,800 points. The last time it was this bad, during the 1970s, this pain was spread over two whole years.
  • Bottoming out seems to occur about 1.5 to 2 years after the high point… which means we might still have some time to fall.
  • The good thing is, in all cases, we see the Dow bouncing back a few years after we hit rock bottom… so, if we’re patient, our 401(k)s may recover their losses in a couple years.

Guess I’m waiting until 2011 to buy that flat-screen TV…

Updated (3/11/09): Four months have gone by, and Google and Goldman seem to have recovered nicely… while GE is now trading around $9. Hmm. But not to worry, the General certainly has company: the Dow is now 51% removed from December 2007, versus a mere 36% in December 2008. Again, just by looking at these graphs of the previous recessions, it seems like we’ve got at least two years to go from the peak… By my calculation, it’s looking like December 2009 may be the inflection point where the market will finally bottom out and perhaps start turning up again. With the way things are going now, I’d hope so.

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The New and Improved Chinese Zodiac for Christmas

Over Thanksgiving break, I made the unfortunate decision to have lunch at a local “Polynesian-Chinese” restaurant. polychinaTiki Palace was dead empty when my grandmother and I arrived at noon. The waiter with the leather jacket and lazy eye further confirmed my growing suspicion that the place was a front for the Polynesian-Chinese mob. While waiting for the food and trying to catch a glimpse of illegal opium dealings, I found myself perusing the Chinese zodiac placemats. I’d forgotten how wonderfully descriptive these zodiac signs were. Born in the year of the Ox, I read that I am supposedly easy-going, fierce, demanding, and good with my hands… I would be a good hairdresser, the zodiac proselytized.

It seems like you can always convince yourself of some truth if you think about it long enough. After reading about my Ox-ness, I started reconsidering careers in which I could put my good hands to use, like becoming a concert pianist or a cardiac surgeon. chinesezodiacIt also got me thinking: if such attributes can be gleaned from something as arbitrary as year of birth, how else can we be convinced of our easy-going fierceness? So, given that this blog is inspired by exposing arbitrariness, overgeneralizations and frivolous categorizations, I have decided to create a zodiac of my own. Based on a complex mathematical algorithm, basic principles in quantum physics, and an undying belief in Santa, this revised zodiac is a marked improvement upon the old, vague, anything-goes version. My only hope is that Tiki Palace will one day carry my zodiac… and take their orange chicken off the menu.


Add up the two digits in your DAY of birth (for example, if your birthday is on the 4th, you would add 0+4 = 4). Then take the sum, and match it to the reindeer below.

1 // RUDOLPH – 2 // DASHER – 3 // DANCER – 4 // PRANCER – 5 // VIXEN – 6 // COMET – 7 // CUPID – 8 // DONNER – 9+ // BLITZEN

reindeer(1) RUDOLPH: You are a tireless optimist, filled with fuzzy positivity. You are perennially cheerful, chipper, and trusting. You’re generous with your smile and your exclamation marks. You often sing karaoke, bake cookies and use “heart” as a verb. You don’t notice that sometimes, other people want to bludgeon your sugary goodness with a baseball bat. You get along best with Dancer and Cupid. You should avoid Dasher. You will likely become a customer service representative for a company that sells rainbows and hugs.

(2) DASHER: You rush through life, never noticing a thing. You are perennially busy, edgy, and on the phone. You enjoy Starbucks lattes, walking fast, and eating hot dogs from street vendors. You probably own two phones, a bluetooth headset, and a profanity-heavy vocabulary. You get along best with Vixen and Blitzen. You should avoid children and the elderly. You will likely find yourself sobbing in the bathroom as your fortunes slip away with the withering stock market.

(3) DANCER: You love drama. You swing from extreme highs to extreme lows, from radiant jubilation to a depressing, old Sarah McLachlan song. You are overemotional, sensitive, and sometimes scary to be around. When you’re angry, you like to start fights and challenge strangers to dance-offs. When you’re sad, you like to buy a gallon of ice cream and watch The Hills in sweatpants. You get along best with Prancer. You should avoid hard drugs and The Notebook. You will likely become a high school chemistry teacher/soccer coach.

sadsanta(4) PRANCER: See ‘DANCER’. Sadly Santa was not creative enough to come up with unique reindeer names.

(5) VIXEN: You’re devious, sneaky, and utterly intriguing. You’re a Bond girl before we find out whether or not she is evil. You are mysterious and potentially harmful to others. You enjoy drinking martinis and attending masquerade balls. You get along with nobody. You should avoid everybody. You will likely get arrested, escape, and move to Fiji at some point in the future.

(6) COMET: You revel in your anonymity, coming and going as you please. You are partial to the emo-style nomads, the quiet heroes, and the courageous loners. You want to be in the choir, in the background, disrupting the world as little as possible. You get along best with yourself. You should avoid Dasher and Dancer. You will likely find yourself going down one of two paths: either becoming a) Nobel-winning genius, or b) the Unabomber.

lifetimemovie(7) CUPID: For you, the world is full of love. You love love. You love people. You think that all the world’s ills can be solved by love and diamond rings. When others complain, you immediately think that it’s because they’re not getting enough love. You prescribe Match.com, a stiff drink, and Viagara. You get along best with Rudolph. You should avoid single people. You will likely find yourself as on a TLC reality show, or as the subject of a Lifetime original movie.

(8.) DONNER: Unfortunately, you are dull, boring, and uninteresting. Because “Donner” does not translate into anything literal, you are stuck as the default outcast, the uncool kid on the block. You spend your days doing mundane things, like knitting, making finger puppets, and watching HGTV. You iron your shirts and you have great table manners. The only excitement in your day comes from guessing correctly on House Hunters. You get along best with your friends on Second Life, but you should avoid all normal people. You will likely find yourself in a charming 2BR/2BA brownstone with a leaky roof and cats.

(9+) BLITZEN: You are fifteen minutes ago. You’re brash, outrageous, and completely behind the times. You think you’re a godsend, but everyone does the eye-roll once you leave a conversation. You enjoy debating hot-button issues that you’ve read about in magazines, and you often end up disagreeing with those idiot “experts”. You’re obviously the preeminent authority on all topics ranging from GQ to Us Weekly, so we should listen up. You get along best with anyone willing to listen. You should avoid people who are smarter than you (if they exist). You will likely end up at an Alaska rally for Sarah Palin in 2012.

So, do you believe in the truths held by this zodiac? According to this, I’m a Donner (born on the 26th, 2+6). Ho hum + HGTV + cats? Sounds about right.

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Random Thoughts on… Reason (and the Financial Crisis)

Reason: (noun): a basis or cause, as for some belief, action, fact, event, etc. Logic. (From Dictionary.com)

Reason tells us that 1+1=2. It tells us that if you leave milk out for too long, it will spoil. It tells us that cars need gasoline in order to run.

But, what if the milk spoils even though we’ve kept it in the fridge all this time? What if our car doesn’t start even though we have a full tank of gas? We might tell ourselves that maybe it’s one bad sample, or an issue with our engine. And so we get another carton of milk at the store, and we bring our car in to the shop. But this second glass of milk is spoiled too, and the mechanic says that while our car is a bit nicked up, he has no clue as to why it isn’t starting. And so we think to ourselves, what the hell is going on?

Welcome to the financial crisis of 2008.

Reason would tell us that Thursday ought to have been a good day for the markets. The Fed announced that it would cut its short-term rates by 0.5% to 1.5% (a four-year low). Because lower rates diminish the cost of borrowing (thus encouraging liquidity), usually such a move would cause the markets to jump. The last rate cut in April was only 0.25%, and the Dow jumped 100 points the next day. The previous rate cut of 0.75% on March 18 caused the Dow to jump 420 points. So, with Thursday’s cut, we could have reasonably expected the Dow to rise anywhere from 100-400 points… or, at the very least, be slightly up.

Similarly, reason would tell us that if a big, blue-chip company hits its earnings targets, the market should respond favorably. After market close on Wednesday, IBM announced that it beat third-quarter expectations and would maintain its year-end target. The stock naturally went up 6% in after hours trading. With this good news, we could reasonably expect that the market would at least calm down on Thursday, and rampant fears about tech stocks would be lessened.

Finally, reason would tell us that if the first two instances occurred (big rate cut, strong earnings from a Dow Jones stock), AND no negative news was reported–then we could expect the market to move up, or at least stay somewhat steady.

Oct 9, 2008 (Dow Jones Industrial Average)

But instead, on Thursday, we saw the Dow Jones Industrial Average fall 679 points, closing about 7% lower than it opened. We saw IBM rise and then drop, finishing right about where it was before it announced earnings, at $90. Staying flat was good comparatively, however, as the tech-heavy Nasdaq index dropped more than 5%. In the month of October, the broad S&P 500 index has fallen 22%, which means that Joe Six Pack’s pension may have just lost a fifth of its value. And all of this is happening on the heels of the $700b bailout that was passed last Friday, which should have moved the market up as well, as it was essentially a capital injection and a government promise to buy up poisonous mortgage-backed assets. So now we’re left to wallow in our shrunken net worth, and play guess-where-the-Dow-will-bottom-out.

References to the Great Depression aren't helping.What is the reasoning behind this recent freefall? According to the Wall Street Journal, “this week’s relentless selloff has been driven by deepening fears about the banking system, and the spillover effects it may have on the rest of the economy.” So, the market did not mysteriously tank on Thursday because something fundamentally bad was uncovered; it tanked because we think something bad is going on, and our thinking that it’s bad has just made it worse. We might be right, or we might be wrong–either way, it’s like we’re saying that the milk has spoiled because everyone thinks it will spoil, or that the car won’t start because everyone believes that a nicked-up car can’t run anymore. Thursday shows us that reason has taken a backseat, and our questions, fears, and now lack of greed are just leading to greater volatility and uncertainty. Furthermore, this dangerous, immeasurable force of fear also has huge implications on what the Fed, the Treasury, and Congress can do to solve this crisis. If the market won’t act rationally to potential solutions, then what’s the point?

Many in the finance industry would likely agree that our world seems fundamentally different than it was even just a week ago. Pretty soon, 1+1 might not equal 2 anymore… instead, it’s whatever we think it is. Any guesses on what that might be?

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