by Studs Terkel
Oh, the yacht is a serious status symbol. A lot of the wealthier class people live right smack against Lake Shore Drive in those high rises overlooking Belmont Harbor. It’s almost impossible to get a yacht in that harbor. They have a long waiting list. I’m sure those people sit in their apartments and say, “Oh yes, that’s my yacht over there.” Some of the yachts aren’t even used, just kept as status symbols, pure and simple. They want to say, “I got a yacht.”
They jump about five feet at a time, for status. First they’ll start with an outboard, which I know nothing about. They’ll come to me usually at thirty feet. They’ll sell the thirty-footers, and want a thirty-five. They’ll jump up five feet at a time until they get up to sixty or seventy feet. And that’s it. There wasn’t much jumping in ’70, I’ll tell you that.
There’s two classes of buyers. One who’s never had a yacht before, who you have to shepherd along. You baby-sit with him until you’re confident he’s well versed in the handling of the yacht. You can’t give him the key and walk away and have him get in trouble on the lake. I’m emotionally involved with the man, I’m responsible for him. There’s just purely selfish motives, too. Any bad publicity on the lake is bad publicity for yachting and bad publicity for the broker. I’ve got to see that he’s safe.
You get involved with people that are overnight experts in boat construction. At first I used to argue with ‘em. But now I just sit there and smile. You’re a dummy, you just don’t know anything. You just let them tell you. Doesn’t matter any more. I regret this work. If I had to do it over again, I wouldnt’ do it. I’d be an engineer, a construction designer.
There’s some fine men in this field. I don’t think there have ever been used car dealers in the yacht business. The yachting fraternity is quite a gossipy clique. It doesn’t take too long to get around if a fella throws a lot of curves. If you establish a good reputation, which I hope I have, that gets around too.
Sometimes you feel like you’re appreciated and needed. Other times they make you feel like you’re a parasite. What burns me up is after you’ve worked real hard on selling the man’s yacht and showed it to a great number of people and you get ready to close the deal, he says, “I don’t think I owe you seven percent.” “Why not?” “You made only one phone call and this fella bought it.” They don’t know how many hours, how many months, how many days and years you sit there hoping something will happen. And the overhead goes on.
The frustration, the humiliation—but that’s in any business, isn’t it? Some of the people you trust the most want to chisel you the most. Your biggest danger is when you get to like a person. You become less businesslike than you should be. You don’t get him signed up. You think, Well, I just can’t ask the man. I’ve been a guest at his house, I’ve wined him and dined him and we’re on a first name social basis. But when you sit down at the table, you’re got a different man entirely. Two different people. You find this out too late. You’ve got a law suit on your hands.
I had one man I thought so highly of, it was remarkable. He’s an ex-Air Force pilot, had been a bombing pilot. And God, he’s good looking, tall, slender, most gracious smile. He’s a WASP, if you know what I mean. He looked like he could be an elder in any church in the country. And he had a very sociable wife. If you wanted somebody to represent the upper crust yachtsman, he would be the one. My God, how he disappointed me.
I sold the man his first yacht. I knew him for years and admired him. He traded in this yacht on a great big expensive diesel. His son, who was a teen-ager, was throwing wild parties on the boat. His wife was afraid something was bound to happen. She said, “We’re going to sell it and get out of yachting entirely.” They put the pressure on me constantly to sell the boat. Finally I got him a buyer. I had done a good job and got him a hell of a good price for it. (Sighs.) After all these years, I didn’t—like a damn fool —if my attorney told me once he told me a thousand times, “Never trust anyone when it comes to business.”
(Takes a deep breath.) The buyer got a forty-thousand-dollar loan at the bank, which I arranged. And the bank hands my old friend a cashier’s check for forty thousand dollars. I said, “Charlie, what about my commission?” It came to over twenty-eight hundred dollars. He looked at me real blank. He glances at his coat pocket where he’d keep his wallent and said, “Oh, I forgot my checkbook.” He didn’t have to finish the sentence. I knew I was in trouble with this man, ’cause I had nothing in writing.
He brought in eight hundred dollars in cash and said, “This is unreported. You don’t have to show it on your books. Internal Revenue will never know anything about it. I’m doing you a favor.” I said, “You’re trying to beat me out of two thousand bucks and put me in a penitentiary. Boy, you’re the biggest surprise to me that I’ve ever had. I thought you were the ne plus ultra of everything a yachtsman would represent. You are the biggest phony I have ever met.” He’s president of a big coal and oil company. Top flight. It makes you wonder if you’re too bright. God, to get hurt by a man like this.
You think a yacht broker is all smiles, and everything is milk and honey. You have your select circle of friends. And you just wonder how bright you are when you establish that circle. You just can’t trust people. Regardless whether they’re street cleaners or bank presidents, you can never tell when they’re gonna throw that curve at you.
(A long pause.) The sooner I retire, the better. I’m getting to sixty-five and I’m just fed up. I can’t roll with the punches like I used to. They bother me more than they used to. So I feet—what for? I should have quit years ago. Oh, I don’t know what I’m gonna do. You know these people your whole life. You have no social life other than yacht broking. I don’t know if I have anything to sell. Maybe you’d find some retired man that’s looking for occupational therapy, that would keep him busy and would bring in about a thousand a month? (A dry chuckle.)
DAVID REED GLOVER
We’re in the offices of Reed Glover and Company, a brokerage firm on La Salle Street, along Chicago’s financial district. “My father was a founding partner. There are twelve partners. We have about twenty salesmen, who also handle the customers’ accounts. These salesmen are otherwise known as customers’ men.
“Our firm was founded in 1931 by my father, Reed Glover. He had been a banker in a downstate town. He felt an investment firm was needed to serve the small community banks. Now there are fifteen thousand bankers, mostly in the middle states, who receive our letters. After having been on the list for forty years, many of them get around to calling us. I’d say we’re medium sized.”
I’m forty years old. I started in the securities business in 1954, the only job outside the army I’ve had. I believed we were in a new era. I thought the founding partners of my firm were hampered by a Depression-era psychology, that they didn’t understand there could no longer be a severe collapse in stock prices. The senior brokers were considered old fogies and stodgy for their unwillingness to go along with some of this new thinking. There has been a great chastening among younger men.
What happened in 1968 and 1969 is that a great many large firms overexpanded. Worse than that, they recommended stocks which were unsound. I’m talking now about the conglomerates. You’ve heard about the Four Seasons nursing homes, about electronic stocks. This became the rage. When the downturn occurred in ‘69 and ’70, many of these firms went out of business. They forgot that there really isn’t a new era. The business cycle is not going to vanish. You must be prepared for adversity as well as prosperity. I realize now there are certain principles that must be adhered to.
There have been many times of personal questioning about my occupation. The worst time came when I approached the magic mark of forty. (Laughs.) During that time we were in the heart of the bear market (laughs), and this is a highly emotional business. When the market is on its way up, you have a feeling of well-being and fulfillment, of contributing to the welfare of others. When the market is going down, this is a rather unfortunate line to be
in. When you’re dealing with an individual’s money it’s a terrific responsibility.
The individual of means is exposed to so many people in the brokerage business that it’s quite a compliment to have him turn to you for investment service. The rule I’ve always gone by is that I expect to have my brother-in-law’s account and my roommate in college. But it seems everybody has a roommate in college or a brother-in-law who’s in this business. So I don’t really use my social acquaintances for purposes of business. My closest friends are with many of the brokerage firms. At social gatherings we don’t discuss the market, other than in an amusing rather than a serious way.
I’m amazed how rarely the individual customer will find fault with the broker. Along with that, there’s no written contract in our business. If the stock goes down, the customer’s word is his only pledge. They all pay. This is an honorable business.
When you’re dealing with a person’s money and investments, you deal with his hopes and ambitions and dreams. More people are becoming sophisticated in understanding that they can actually own part of a corporation like General Motors simply by placing an order for an intangible item like a stock certificate.
It’s quite easy to look around and say this is a parasitical business. All you’re doing is raking off your cut from the productivity of others. That is, I think, an erroneous view. Frankly, I’ve wrestled with that. It comes down to this: the basis of this country’s strength and prosperity is the finest economic system that’s ever been devised, with all its inequities and imperfections. Our system depends on a free exchange of publicly owned assets, and we’re part of the picture.
If there were no stock market, I think the economy would be stifled. It would prevent the growth of our companies in marketing the securities they need for their expansion. Look at Commonwealth Edison. It came out just the other day with a million shares. Without the stock market, the companies wouldn’t be able to invest their capital and grow. This is my life and I count myself very fortunate to be in this work. It’s fulfilling.
RAY WAX
He has been a stockbroker on Wall Street for several years. He lives in an upper-middle-class suburb on the outskirts of New York City. He is married, has two grown children.
“I really believed when I was growing up that somehow I would score. As a kid—I was no more than twelve—I’d get up at five ’ in the morning and go to an open market where they sold cakes in an open stall. It was so goddamned cold you had to cut the goddamned cakes with mittens. I made four, five dollars a day. That was a lot of money in those days. I worked. I fell good about it.
“I was a golf caddy at fourteen. I used to carry two sets of golf bags for eighteen holes for $2.50. I guess it’s a ten-dollar bill today. You really earned your pay when you went through eighteen holes. If the caddy master liked you, maybe you did thirty-six holes.
“I felt even though there was money in the house, I was supposed to work. I was supposed to earn something. It was one of the things you had to do. If you did, it was supposed to make you feel good. I was a good caddy and I felt good about it. I felt that somewhere along the line someone would recognize that I had that special gleam. Horatio Alger—which is a crock of shit.”
For twenty years he engaged in all sorts of enterprises and “I was generally successful. Then I lost interest or I thought the promise had gone out of it and I went on to something else. ln the late fifties I had exported cars to South America. I was doing a million dollars a year and sort of ran out of steam. My one virtue was I didn’t rip anybody off. For a while I thought I could live in South America. And I found out that the whole world was rigged. They didn’t want me to do anything legit.”
What kept you from becoming a millionaire?
“I just wasn’t . . . I wasn’t facile enough. I was bright enough to do the things I had to do to make a good living, but I really didn’t come up with the big score. And . . . (Pause.) Well, there was a limit to what I was prepared to do to make money in a crazy way. But that’s no good. You’re supposed to do everything you have to do to make money. I guess at some point there’s a limit. You either demean yourself or change yourself or something happens where you become something else. Later, when I owned a hotel, the only way I could survive is if I let a pimp put four broads in the bar. I passed. I couldn’t do it. I eventually lost the hotel.
He became a land speculator. “I kinda ran out of money, because land takes a lot of money. I became a real estate broker in self-defense. I began to peddle land. I sold land to builders. I realized they were just one cut above running a candy store. Within a couple of years I was building houses and building them better than anybody’s ever built them before. I really had some kind of responsibility to build a house that was a good house. Until I began to run out of land . . .”
I loved building houses. It’s really a marvelous thing. You work with people that work with their hands. When the carpenters come in to work, goddamn it, they’re good. When the bricklayers came in, they gotta know their job. I had a roofer, a Norwegian or whatever the hell he was—when he went up on that fuckin’ roof and he bucked that stuff there, man, you knew you were gonna have the best roof you ever had on a house. I didn’t cheat on the house. I sold my own houses, wouldn’t turn them over to an agent. I enjoyed doing that more than anything I ever enjoyed in my life. I don’t know why I didn’t continue it.
I was kind of driven. I had to go on doing something else. I couldn’t see myself building a development of fifty, a hundred houses, little boxes. I couldn’t get the kind of plots where I could put five, six houses on one or two acres, to build a house with enough nuances. The challenge went out of it after a while.
I invested in a hotel. It had 101 keys. I got fascinated with hotels, the operation of it, how it was put together, who came, who went. I came out with a quarter of a million and I built my own hotel—alongside the World’s Fair grounds. We did the biggest job of any motel at the fair. In two years the fair was a shambles. The area was a desert, death. I walked away with a whole skin, but gave the hotel back to the bank.
While I was fiddlin’ around with the hotel I began to play the market. I got lucky at some point and made about a hundred thousand dollars. That convinced me I could make this my way of life. I thought it would be a nice way to live. I began to study to be a stockbroker. I passed the exam. You learn the ethical side of the business, what you can and can’t do. It’s all mumbo jumbo.
The New York Stock Exchange has 1,066 members. I always think of it as the Norman Invasion. These are William the Conquerors. The 1066 is one of the greatest clubs in the world. A seat on the exchange costs anywhere from a hundred thousand dollars in bad times to a half a million in good times. These guys didn’t pay that price of admission without deciding that they’re gonna take care of each other, protect their own. They’re the guardians of all the stock. They’re the specialists. They dole out these stocks to each other and they have the edge. They become the bookies on all the stocks. This is the only wheel in town.
I really thought of the market as a sort of river. Money running to the sea. I figured all I had to do is just stand on that bank and lower a bucket every once in a while and take a little bit of that out. I didn’t care how much these gentle gentiles, with those little briefcases under their arms, took back to Larchmont or how much went up to Westport. I figured they’re gonna let me lower my bucket. But they don’t let anybody lower a bucket.
I’m afraid the work of a stockbroker is superfluous. He did have a function at one time, when little people were allowed in the market and given a chance to share in part of the goodies. The market really is a game played by very skilled people, who accumulate stocks at low levels so they can be distributed at high. The market is rigged. Knowledgeable people buy certain stocks, whether they have intrinsic value or not, and at some later hour the public is told these stocks represent good values and should be purchased. By the time Joe Blow goes in, the people who’ve created this atmosphere go out. Fo
r every dollar made in the market, a dollar has been lost. The pros make it, the 1066 boys.
The brokerage firms need some people to make this whole machine work. Somewhere in this pattern of things is the stockbroker. Here’s where I come in. We’re all hooked in. I’m watching every transaction. Everything that happens in the market I see instantaneously. I have a machine in front of me that records and memorizes every transaction that takes place in the entire day. It’s called a Bunker-Ramo. It’s really a television screen that reproduces the information from a master computer that sits in New Jersey. Within a fraction of a second, when I press for the symbol I want, it goes to the central computer and it automatically comes back. When I take my hand from the machine, the screen in front of me is already reproducing the information.
I watch eighteen million, twenty million shares pass the tape. I look at every symbol, every transaction. I would go out of my mind, but my eye has been conditioned to screen maybe two hundred stocks and ignore the others. I pick up with my eyes Goodrich, but I don’t see ITT. I don’t follow International Tel, I’m not interested in that. I don’t see ITT, but I do see IBM. There are over thirty-two hundred symbols. I drop the other three thousand. Otherwise I’d go mad. I really put in an enormously exhausting day.
It’s up at six thirty, I read the New York Times and the Walt Street Journal before eight. I read the Dow Jones ticker tape between eight and ten. At three thirty, when the market closes, I work until four thirty or five. I put in a great deal of technical work. I listen to news reports avidly. I try to determine what’s happening. I’m totally immersed in what I’m doing. For the amount of work and intelligence I bring to this job, I’m not being properly compensated. I make a routine living now. The only compensation is like me against the machine. I’m trying to use my intelligence against the wheel. I’m a fuckin’ John Henry fightin’ this goddamned steel drill, and I’ll probably die with my hammer in my hand. (Laughs.) Because I don’t want to buy the package. Maybe I’m wrong, but I want to get there my own way. It’s very difficult, that’s God’s truth.
