Wall Street in Perspective

I entered Wall Street in 1956. Banker's Trust, then Ball, Burge & Krause in Cleveland. Reynolds Securities, Oppenheimer, Drexel and Dean Witter. The old Wall Street was privately owned. The top tier of ownership made up to 30% on their equity--the middle group ranged up to 15%. They were risk adverse. Leverage over 3-to-1 was considered speculative. Mike Milken introduced cash flow equity. But, he too was risk adverse.

Merrill Lynch demanded negotiated rates. The old timers cashed in and fled. Public ownership followed. A young breed of business schoolers replaced the old timers. Greenspan made cheap money available. The new group arbitraged the spread between government money and what the market would bear. New and unintelligible products replaced traditional investing.

The youngsters made millions--far beyond the modest profits of prior bankers. Ponzi ruled. The government provided the tulips.

Then, like dancing school, the music stopped and with one chair short, a domino effect crashed the market. Each day another entity caught short. Short sellers ruled. Hedge funds turned to commodities--the riskiest of all investments. That bubble burst. The government called in markers. Bernanke/Paulson faced Greenspan's profligacy. His double speak was revealed. Where will it end?

Perhaps reality has brought us new leadership. The 2008 election may be the most important in our lifetime.

HARK!

Hark! Who ventures through these dank mists? Hail! 'Tis noble Alex! What brings thee to this dreary place? 'Tis talk of a quarter, perchance a half, me hopes a point. But sooth! Our foes would have us believe that a mere quarter would sink our nation into inflation, unemployment, or both. What say you? Fear not. Our great nation has withstood the pestilences of the past fifty years. Have we not slain the ghost of that double-speak, Greenspan? Stand up, brother Hamilton in defiance. Proclaim our paper to be money good that our economy is the best in the world--our confidence in master Bernanke is steadfast. Defeat the Keynesian dragons that I may sleep--perhaps to dream of that shining city atop the hill.