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  • America walk stree, the house that greed built
  •  The House That Greed Built

    “GREED is healthy. You can be greedy and still feel good about yourself.” Those words, part of a speech to the graduating class of a business school, reportedly met with laughter and applause. (The Roaring ’80s, by Adam Smith) The speaker was one of Wall Street ’s great successes, worth hundreds of millions of dollars. Not long afterward, though, Fortune magazine named the same man “crook of the year.” Within months, he was in prison.

    Greed, it turned out, was not so healthy after all. But the man’s words are often quoted as typifying the attitude of Wall

    Street . What do the facts show?

    Consider the Wall Street trends we have already observed. Lightning-fast computer trading, frenzied buyouts of companies for enormous profits, mountains of borrowed money, all seem to share a common thread: a focus on the short-term gain.

    All eyes are on the instant profit. An editorial in Canada’s Maclean’s magazine phrased the point powerfully: “The newly rich of the 1980s want something for nothing: the most amount of money with the least amount of effort.” Is it any wonder that such a profit-driven society has spawned its own brand of crime? It is called . . .

    Insider Trading

    “Just what is it?” Awake! asked a retired investment banker. His answer: “In its broadest sense, insider trading is using something that you as a professional know but that the investing public does not know. It gives you an edge if you take advantage of it.”

    This practice is illegal. But it became so prevalent on Wall Street during the 1980’s that in just over one year, some 70 Wall

    Street businessmen were arrested. Like many of Wall Street ’s problems, this one too has swept the globe. In Japan a man under investigation for insider trading tried to bribe a legislator involved with the case, kneeling before him with a briefcase stuffed with $40,000 in cash. But he did not know that the whole scene was being filmed and would later be aired on national television!

    Other stock markets​—Canada’s Bay Street, France’s Bourse, and Italy’s Borsa

    among them—​have been rocked by insider-trading scandals. One insider-trading ring that stretched from England to Israel was uncovered. Markets around the world have set up laws to prevent this kind of cheating, but as the aforementioned banker told Awake!,

    insider trading is “hard to define and even harder to control. We had elaborate systems of security, but information is easier to steal than money.”

    The Yuppie Syndrome

    While the greed of Wall Street led some into crime, it led many more into materialism. Newsweek magazine reported that Wall Street was the very heart of America’s greedy “money culture.” The bull market of the ’80’s attracted hordes of young graduates intent on making their fortune. They were nicknamed yuppies, for young u rban

    p rofessionals. Known for their high ambitions and incomes to match, yuppies were targeted by advertisers as ideal consumers, veritable spending machines.

    A former Wall Street trader who describes himself as an ex-yuppie told

    Awake! about his life on Wall Street during the boom years. The thinking at his firm, he said, was: “Your job is your life. Everything else is second.” It was common to be up at 5:00 a.m., off to work all day, and then out entertaining clients until late in the night.

    He vividly remembers one incident that, to him, summed up the way people were thinking. A colleague showed him a series of photographs of a broker suffering a heart attack on the floor of a stock exchange. Fevered trading went on all around the stricken man; nothing slowed, nothing stopped.

    The New York Times reported that the crash would be a blow to yuppies not only because of their borrowing and spending ways but also because of their thinking. Many yuppies just didn’t know the difference between net worth and self-worth.

    [Blurb on page 10]

    Many yuppies just didn’t know the difference between net worth and self-w


    orth

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