Up, Down, & Sideways
Robert H. Patton
New York
for Vicki, of course
and for B. V., with thanks
… to disintegrate on an instant in the explosion of mania or lapse for ever into a classic fatigue.
W. H. Auden
1
When I was young my hobby was the weather. First thing each morning I would look to the sky for cloud types and to the lawn for frost or rain puddles. I checked the thermometer on my windowsill and the flying-horse weathervane atop the old carriage house, now a three-car garage, across the circular driveway. I recorded my findings in scholastic notebooks. The columns of data comprised a textbook I’d created, a manual not only of meteorology but of proper manual making. Even as an adolescent I presumed that my experience was instructive, a lesson others should heed.
Eventually I made my own weather predictions. In competing with TV professionals, I appreciated who were genuine aficionados and who were mannequins hired for their smiles and good hair. I rated them in my notebooks and occasionally sent fan letters, stamped and mailed by my father’s secretary.
She must have said something, for my father began to criticize what he once had called sensible, evidently alarmed that I might actually become a weatherman. He set about altering the object of my fascination but not its habits, the research and analysis that were my main enjoyment. Soon he’d weaned me off weather and turned me on to the stock market. Rather than clouds, I would track the flow of money.
He bought me subscriptions to Value Line and several market newsletters. Annual reports appeared on my bedside table. In the evening we discussed stock picks. He favored blue chips. I liked new technologies with high P/E’s, yet with huge potential to fly. I was sixteen then, in 1976. A conservative, I looked backward for direction. Today, almost twenty years later, I’m still a conservative, but with a twist: I know the past is what you make it.
Father opened an account for me at Tilton, Mayhew stock-brokers on Congress Street in Boston. Providing me ten thousand dollars to start investing with, he forbade me to buy on margin or to trade options short or long. My first three purchases were Wyant Computer, Digital Electronics, Merrill Lynch. I made a few hundred dollars but got bored with so little leeway to operate under Father’s restrictions. I dumped my money into Shenandoah Oil at 26 and concentrated instead on losing my virginity, another tale of investment and yield whose payoff was a wash at best. A year later I persuaded my father to let me trade my account like a man.
I sold Shenandoah at 30, and with almost $20,000 in leveraged buying power was ready to start fresh. I’d noticed the emergence of drive-in/walk-up bank teller machines. Research turned up Diebold as a comer in the field. I got in under eight, and eventually owned 2,000 shares when the stock hit 87 in 1983. Damon was another success. My 2,200 shares rose from four bucks in 1980 to 38 in ‘83. Other winners were Drexler Technology, Minot Optics, U-Save Stores, cash-rich companies whose minimal debt made them strong in the face of high interest rates.
I scored with option calls on Bethlehem Steel during the worst of the Reagan recession. The steel industry was collapsing, but Bessie took steps, closing old factories, trimming the workforce, cutting away fat. The stock continued to tick down. Calls were trading at eighths. I bought more. The company announced a billion-dollar loss—the news I’d been waiting for, the bottom. When people started buying I tripled my money.
On the negative side, I had a stock go bankrupt in 1986, the year my father died. His doctor had fielded my questions about CAT scans with a tip on Alpha Partners, the patent holder on a portable breast scanner designed for home use and mobile clinics. Several hospital supply companies were looking to take the company over, he said. I bought in big. A good gambler pushes his luck when it’s good, a bad gambler when it’s bad. My luck had stunk for a while, yet when Alpha upticked a fraction I doubled my stake. The stock faltered. I averaged down, hoping for a home run. When the stock went belly-up, it left me worse than broke. Like market speculators who jumped out Wall Street windows in 1929, I’d lost not what I had but what I didn’t have. The money I’d sunk into Alpha was borrowed. I was glad my father wasn’t there to see it.
He would have tried to help, admonished me with maddening rectitude before issuing a check. I’d endured his help the year before, when I’d been desperate for money and lawyers to bail me out of trouble. I’d suspected, during that low point in my life, that Father enjoyed my humiliation. I’d left the family under acrimonious circumstances several years earlier. My prosperity in exile had irritated him—just as, later, my personal and financial woes seemed to gratify him, to conveniently knot some last loose end in his life before he had to leave it.
2
My family is an old New England conglomerate, the getting of whose fortune we don’t discuss. The family used to be better than it is today, by which I mean more industrious. The patriarchal name is Stalls. I’m a Halsey. On the Stalls family tree we Halseys are a twig and so must earn a living. The real money is nearer the tree trunk, doubled and redoubled through generations of prudent matrimony. Of my older relatives, some are working professionals, but most have yet to take a job. Instead they keep occupied. There are ladies busy in charity work, who garden, raise horses, ladies of a certain masculine handsomeness who consider dyed hair and painted fingernails the mark of idle minds. Their husbands often run whimsical businesses at serious deficits, millionaire owners of farm stands and marinas, art galleries and trout nurseries. Whittlers of duck decoys, breeders of foxhounds, they sell one or two a year and call it enterprise.
Inherited wealth has kept many Stalls men terminally young. Disguised as adults, they hold the attitudes of boys, childish or childlike depending on your politics. Browbeating a nephew, they display the brutality of the schoolyard. Over cocktails they may invoke some prep-school prejudice or a dusty theme like destiny or class to analyze what’s wrong with America. Then there are those Stallses whose total lack of professional accomplishment has opened their hearts to all the world’s losers. Gentle and sad, they make no show of excellence. They sip twelve-year-old whiskey in ten-year-old tweeds and raise toasts to better men. “Finest kind!” they’ll say when they hear of someone’s triumph. “Keep it up!” You look for envy in their faces, a glimmer of loathing; it isn’t there. Like happiness, success is something they can live without. They prefer the dream.
Any discussion of money bores them completely. They don’t care where it comes from, they don’t care where it goes. These are people who have never paid income tax. The family financial office does it for them, also pays their mortgages, their kids’ tuitions, their servants’ salaries. All their lives they have received quarterly income checks drawn from family cash funds. For years, my father, as head trustee at Stalls Associates, signed those checks. The office originally hired him as an accountant in 1952. At the time it was still managed by direct descendants of Samuel Stalls, the shipping magnate (and slave trader, if you must know). They’d refashioned Stalls Associates from an active business into a private investment firm, quietly tending the trust portfolios of Samuel’s many beneficiaries.
As his example faded to myth, however, interest in finance waned within the family, prompting fears among the elder trustees that Stalls Associates might someday be Stalls in name only, its offices overrun with outsiders, its homey benevolence lost to the smiling contempt of MBA mercenaries for their overprivileged clients. Father’s eventual appointment as head trustee put those fears to rest. He always had been popular with his employers. His status as a salaried tax mechanic evolved with each clambake and golf game into something approaching a partner. His marriage to my mother won him full acceptance. She was one-sixteenth Stalls. Their
merger made him family.
He had no family of his own. To hear him talk you would have thought his life began in 1946, when he emigrated to the United States from Great Britain. His parents had been killed in the Blitz, he said, and he’d served in the British Army during World War II. His reticence about the past arose from belief that his foreign origins would keep him from the club, the Stalls fraternity; he even had recast his English accent into the regionless, formal intonations of a classical music deejay. Yet in later years he often purposely declared himself not a member of the Stalls family, not an equal, by letting slip suggestions of illegitimacy and childhood poverty. I wish I could say that he offered these hints to exalt his ascension from such difficult origins, or that his self-deprecation was a tactic to put others at ease. But in his office he received the heirs of Samuel Stalls with genuine deference, indeed with the breathless servility of a contented royal footman.
In private he allowed that some Stallses were less than perfect. They were spoiled, he said; clumsy with freedom. In the 1960s, when a number of my cousins became hippies and draft dodgers, he lamented what he called a failure of bloodlines (he was against the Vietnam War but in favor of sacrifice). When they returned in the 1970s, older and wiser and wondering about their inheritance, he embraced them as prodigal children. At Stalls family gatherings a favorite toast proclaims, “We’re the best!” Father believed it. He believed it to his grave, which lies in ultimate assimilation in the Stalls family plot on Boston’s North Shore, albeit in a corner.
3
I was born with two trust funds to my name, one technically termed a revocable trust, the other irrevocable, each worth about $100,000 in 1980 when I turned twenty. Dividends and interest on $200,000 are not enough to live on if you’re thinking house and children and a comfy situation, plus any capital you spend cuts income even more. So in 1980 I went to my father requesting that the trusts be turned over to me, that I might manage them to suit my needs. I’d opened a new account with a discount brokerage and I wanted my money today. He was impassive. “Are you in trouble? Is it drugs?”
“I’ve read the terms of the trust. No explanation required.”
“I’m asking as family, not your trustee.”
“This is business,” I said. “Family time was last month.” While home on vacation last month, I’d announced to my parents that I was quitting college after the spring term of this, my sophomore year; my joke about us splitting the saved tuition hadn’t amused them. “It’s not drugs,” I assured Father now. “Managing money is what I do best. To do it right, I need time and I need capital. This’ll be my full-time job.”
“Last month we agreed to a year off.”
“To start.”
Father, then sixty-one, was balding from the back of his head forward. He wore a square-cut suit and L. L. Bean walking shoes; the shoes identified him as a boss beyond dress codes. His office recently had been refurbished. Amid modular furniture and track lighting he seemed ensconced here through duty alone, a monk in a gallery of modern art. He said, “It’s a pain moving these assets for so short a time. Why not trade through us?”
“I can do it cheaper through a discount house. And I want to keep my business private.”
His eyebrows arched. “What sort of investments are you planning?”
“Market futures, options. Whatever it takes.”
He considered. “No. I can’t allow it.”
I’d expected this; still it knocked me dizzy a moment. I pressed on, reciting the script I’d practiced. “You can’t stop me. I’ll sue for malfeasance.”
“As your trustee I’m responsible for your financial welfare. If I believe you’re jeopardizing that welfare, I must act against you.” He paused. “I’ve seen it too often, Philip. Cousins who pissed their inheritance away on divorcees and religious gurus, on nutty save-the-world causes. Nat Stalls? When he was your age he gave half a million dollars to the American Civil Liberties Union. He sells cars now—a Stalls! His father has sat right where you’re sitting and wept.”
“Nat’s a flake. I don’t have a need to be poor.”
“You want to be rich? You’re rich already.”
“Two hundred thou is nothing. It’s a beginning.”
“One hundred thou. The irrevocable’s principle you can take only at my discretion.”
“You’d withhold it?”
“I have to protect your issue.”
“I don’t have any issue!”
“Neither did your mother’s father when he established the trust. Be glad he planned ahead.”
“This is crap. I’ll get a lawyer.”
“My secretary can give you some names.”
“I don’t want one of your golf cronies. I want a sharp Jew who likes a fight.”
He was silent a moment. “We won’t fight. It’s a business dispute between you and this office. The family needn’t hear of it,” he added, and my way to win was clear.
At a Stalls wedding reception soon thereafter, I cornered several cousins and informed them their wealth was disappearing. The stock market, I said, was in a long bear phase and everyone’s worth was down. My cousins shrugged; their pockets were full enough. I quoted price declines, quoted the market doomsayers, columnists whose ill-invested readers crave company in hardship. I told them the wait-it-out policy of Stalls Associates was a sure slide to the poorhouse, still they were unmoved. What finally roused them was my naming of investment firms that did better, that through daring and diversification outperformed our family office. “No!” they exclaimed, for though they couldn’t relate to dollars and cents, they could relate to competition, with its echo of the playing fields. I told them that’s why I was leaving, pulling out my money—I cared about the score.
They confronted my father. From across the reception room I watched him in action. He touched their jacket sleeves as he spoke to them, calming their alarm. Over their shoulders his eyes met mine. My heartbeat felt like a fingertip jabbing under my breastbone, telling me to pay attention, be careful, beware. Then Father nodded tersely and turned his back to me.
I was scared of him, you see. I often wonder why. He wasn’t coarse or domineering. He winced at violent confrontation. Yet his composure could seem clenched and barely contained, a willful put-on rather than his natural self. I wondered if his stern placidity was a self-administered antidote to some trauma in his youth—to his experiences in World War II, perhaps, and the memory of whatever bad things he’d seen or done. I understand some veterans compulsively display aggression in their postwar hobbies and demeanors. Not Father. His hands never closed to a fist. When angry, he’d flatten them in his lap or on the tabletop, like a cardsharp declaring his honesty.
Lofty in his professional status (Stalls Associates represented more than $500 million in assets), he was personally nondescript. Fiercely stubborn when he chose to be, he maintained a pose of passive awe before the Stalls escutcheon of old-world Anglican vanity. It was this contradiction that intimidated me, his manner of bland inscrutability that didn’t square with the power he wielded. My pushy bravado in our recent exchanges was a kind of hysteria on my part, a petulant holding of breath until I turned blue. I was looking to get a reaction from him. He, as best I could tell from his non-reaction, was looking to see me smother myself.
At the wedding reception I imagined that his nod to me was a gesture of respectful surrender, for I’d taken our dispute where he wouldn’t fight it, to the family. Within two months I’d wrested my inheritance from his control, and certainly his nod prefigured that concession. But penalties and fees he deducted beforehand bespoke the resentment he never showed. He was cool as a hangman. His nod merely meant goodbye.
4
My banishment from the family carried an outlaw glamor. It gave me identity and gave me a cause: I would succeed on my own, for spite. In dismantling my trusts, the office squeezed me for attorney’s fees, a two-percent disbursement penalty, wiring costs, and broker commissions. The market was falling, so
each day’s delay, each day I couldn’t sell, hurt. No family member had ever cut ties with Stalls Associates before. When word of my defection spread, my cousins were a little miffed, wishing me well while soothing Father with predictions of my failure. For twenty years he’d godparented their newborn and eulogized their dead, a sun and moon on their lives. They wanted no shadows, no change or disquiet. He was their invaluable servant, and a household collapses if the servants aren’t happy.
What guilt I felt about upsetting him was assuaged by his petty reprisals. As for my mother, though she was chagrined by the rift between her husband and only child, I confess I wasn’t much moved. My years at boarding school and college had rendered her a bystander in my life. Our reunions always were a letdown to me, like seeing actors in the flesh.
Banishment implies a certain melodrama that was absent in my case. No curses or decrees came down, I just stopped going home. In subsequent years our continued proximity (I lived near my college in Providence, Rhode Island; Father was an hour’s drive north, in Boston) emphasized the humdrum nature of our estrangement. The distance dividing us might as well have been an ocean, or the virtual moat a manicured lawn can be between two suburban homes. I spoke with Mother by phone and sometimes met her for lunch in Providence, when she rode the commuter train down. Attorneys handled my communications with Stalls Associates and the transfer of assets from its bank to mine. In time I received a wire of $185,000 and change. But my old account at Tilton, Mayhew remained a problem—established when I was sixteen, it was still in my father’s name. I asked Mother for help in procuring the profits I’d earned the past four years. Certain our feud would end by Christmas, she rather playfully offered to petition Father on my behalf if she could tell him that I loved him. I told her it’s a deal.
Up, Down and Sideways Page 1
