These days the masters of the Wall Street universe are exposed for what they really are, grossly overpaid overly aggressive master salesmen who usually make bad managers.

But never worry for their future. The top people who brought to the world the securitization of mortgages and all sorts of wild derivative instruments may be out of work for the moment, or barely hanging on, but most will go on to other positions taking a considerable amount of their plunder with them. One thing that they know very well is how to take care of themselves.

The big swinging dick masters of the universe may not have the same swagger as before but just as a professional criminal con man will always find a new way to make a come back after being released from prison these guys and gals will probably give the world another high powered gift in no time at all. We had all best beware.

I had a small taste of the Wall Street mentality back in the 80’s when I worked in a building adjacent to the World Trade Center as a commodity futures broker. One of the firms I worked for was a leader in the just beginning to boom futures managed account commodity industry. I had already been a commodity broker for a number of years and thought that I knew a thing or two about the markets.

I guess that as a man in my early forties I should not have been surprised by the fact that the firm cared little about how much you or the other brokers knew about commodity markets or how good or bad of a trader you might be. Their interest was in whether or not you could bring in money. Period.

No money coming in for a month or two , no job. It was as simple as that.

The first week on the job was a terrifying experience. The new guys were herded into a conference room and the training immediately started. Role playing was the order of the day. The trainers were highly experienced brokers who rotated off the sales and trading floor and in front of the class of newbies started with their pitch. The new guys played the role of prospects and were expected to come up with objections which the trainers would promptly put down.

Of course, the sales presentation was highly scripted. And it was long. Really long, an hour or so. And all of the news guys were expected to learn it fast and so well that no one could tell that it was scripted.  The pressure was on and stayed on until you either went to lunch or the bathroom, never to return, or mastered the presentation.

After about two weeks of constant drilling and role playing as both a prospect and salesmen/broker what was left of the class, there was about a 50% dropout rate, something like US Navy Seals training, you were finally given a phone and a endless stack of junk leads and expected to work about twelve hours a day making your presentation.

You wouldn’t expect the firm to give you premium leads to start would you? You had to prove yourself by closing at least a few junk leads first. These were mostly people who had already said no a few times before. Some of them were not too happy to be called yet again. You had to be tough to survive in this business.

Some of the presentation techniques we were taught were almost unbelievable. But they worked. The first order that was given to a prospect was “grab a pencil and a piece of paper. I’ll hang on”. The second order was “now write this down”. You see you wanted to find out right away if the prospect would follow orders, for later you would order him to send you money.

If a prospect said “I have to think about it” you might say “think about what? I just gave you all of the facts that you need to have to make a decision. Instead of taking smart investor action you’ve probably been thinking about things all of your life. And how successful are you with your investments? Let me ask you? Do you have to get your wife’s permission to invest your own money?”

The prospect might say “of course not, I make my own decisions” Then you would come back with ” then here is what I want you to do right now. Now write this down. Send me $25,000 to (wire instructions would follow ). Now is $25,000 too small for you?”. If he still objected you might say “are you a man or a mouse? Are you capable of making a smart investment decision on your own? You do realize that these are fast moving markets, don’t you? If you delay the opportunity will be lost to you. Now write this down”

And so it went. You were taught to cover all of the bases. And why would a grown man or women put themselves through this grind of making never ending phone calls six days a week (we worked about six hours on Saturday). Why for the money, what else?

We had twenty two year old young men just out of college making $20,000 grand a month. That’s probably about fifty grand in today’s dollars. We had immigrants just off he boat, well so to speak, they probably flew in, who could hardly speak English, making five to ten thousand dollars within their first month or two. They thought American capitalism wonderful. It was amazing how fast their English improved as the money started to flow in.  

We had sales contests with fabulous prizes. Once a quarter we had a top achievers dinner. You and your spouse or date were treated to a private limo, driven to a super New York City expensive classy restaurant, treated to a fine meal and unlimited amounts of fine wines or beverages of your choice, and oh yes, an expensive gift and trophy. You would kill to gain the recognition and peer approval that making the President’s Club dinner would bestow.

Out of this tough sales training and performance oriented background the masters of the universe emerged. Typically, the top sales people, “brokers”, were promoted to managers. Bringing in the money at all costs was the name of the game.

And bringing in the money was what these sales masters did. People who really should have known better poured billions into the Wall Street coffers. In stocks, options, commodities, managed accounts, forex, it mattered not. The masters of the universe could sell anything to anybody, from the hedge fund manager to the small investor living in a Podunk town somewhere.

Damn, they were and still are good. But dangerous. Our whole financial system has been brought to the edge of a disastrous failure by the masters of the universe. But they alone are not to blame. The greed in all of us allowed them to exploit us, to manipulate our sense of right from wrong. Our own greed for a little more yield on our investments placed us into a position of taking on huge risks.

Who knows how all of this will play out? Not too well I expect. Don’t make the mistake of believing any of the masters of the universe that the disaster will be averted. That includes the US Secretary of the Treasury. He was once one of the elite masters of the universe. I imagine that years of intensive training and experience on Wall Street has so influenced the man that he believes his own BS as being the absolute truth.

Like saying over and over again that the United States favors a strong dollar and that the US economy is strong and resilience. Har, Har!

We had all best beware.

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