Monkey Business

by John Rolfe

  Now through all these comings and goings I hadn’t forgotten my original goal for the evening—the identification and pursuit of free love. In fact, throughout my evening of sedentary pleasure there at the table I’d had an ongoing dialogue with a number of prospects, but none of them had come to full fruition. As I saw Troobie walk by, I corralled him.

  “Troobie, what’s going on?”

  “Not much.”

  “I’m all fucked up. I just peed underneath the table.”

  “You did what?”

  “I peed underneath the table here.”

  “Well then why the hell are you still sitting there? Move your lazy ass somewhere else, you filthy pig.”

  “Yeah, I guess I’d better.”

  “Well, what do you want to do, Rolfe? The party here’ll be going on for another hour or so, then they’re gonna shut it down. The question is whether we stay here to take our chances or go and get a sure thing.”

  “What do you mean, sure thing? You mean a strip joint?”

  “Yeah, what else.”

  Right there, Troobie and I should have realized how far we’d sunk. We were so hard up to get a peek at some ass that we were about to leave a fully paid, top-shelf party, full of all kinds of women just itching to get laid, so that we could hunker down in a seedy sex parlor and pay a bunch of gyrating Delilahs to let us fondle their anatomy. And while some might argue that perverts are born, not made, I’d take exception to that. The job had shifted reality for us. It was making us crazy. We had no life outside of work because we were working hundred-hour weeks, which meant that Friday nights, Saturday nights, and Sunday nights found us sitting in the office more often than not. We didn’t have enough time on the weekends to go out on dates, meet women, and establish relationships. When we got the rare night off we wanted a guarantee that we could make the most of it. The only way we knew of to guarantee something was to keep throwing money at it until it happened. The night of the holiday party, that meant that there was no way we were going to waste time working on a 50 percent chance of getting one of the BAs to come home with us when we knew we could hit the peep shows, lay down some cash, and have a 100 percent chance of at least seeing some poontang. In our minds, there was no comparison.

  Troobie and I put our heads together. The way we saw it, there were two alternatives. We could go to one of the usual upscale places like Scores, Tens, or the VIP Lounge or we could be more debaucherous, roll the dice, and go to the Vault—a sex club down in the meatpacking district. The Vault offered up the not so standard S&M fare: men with minor self-esteem problems lying in the piss trough, dominatrixes leading their subservient partners around the room on leashes, spankings, hot wax, and cat-o’-nine-tails. It was the Betty Crocker’s kitchen of sadomasochism.

  We decided to split the difference and go to the Harmony Theater. The Harmony was filthier than the strip clubs but not as low as the Vault. It was a Shenanigan’s meets Peepland—a full-contact booby bar where a single dollar could buy you a grope up on the main stage. When we got there, Troob and I parted ways for a while to find the women of our dreams. I saw Troobie getting a lap dance at one point while the stripper used his Hermès tie like a big piece of dental floss between her legs. Troob told me later that he had to barter the tie away for another lap dance after he ran out of money. As it turned out, Troob and I weren’t alone in our desires. After about an hour our colleagues Tubby, Slick, and the Big Man all walked in. I guess that they were looking for a sure thing, too.

  From my perspective, the only repercussion to come from our night of holiday bacchanal was a burgeoning realization that our lives were pathetic. For Troob, though, the effect of our night out was more profound. I walked into his office the following day with a huge smile on my face, despite a wicked hangover. I’d come to recount the previous evening with him, and revel in our naughtiness. What I found, though, was a chastened Peter Troob.

  “Troobie, man, that was GREAT last night! We gotta do it again soon. I gotta get back down there to the Harmony. I love chasing the ladies with you.”

  “I don’t know, man. I don’t feel so good about it.”

  “You don’t feel good about it? What the fuck is that supposed to mean?”

  “It’s Marjorie, man. Don’t tell anybody I said this, but I feel guilty about last night.”

  Marjorie was the girl from Chicago that Troob had been dating. He had met her over a year before, and their relationship had seemed to stick. She knew he worked hard, and he had been forced to bail on her before, but since she lived in Chicago she didn’t really know just how bad his work hours actually were. That was good. I knew that Troob liked her, but that hadn’t ever stopped our debaucherous pursuits before. I could see that Troob was starting to get that look in his eye that you see in your friends right before they leave the bachelor brotherhood. That look scared me. He was my comrade-in-arms, my partner. Troob was already getting up the curve on developing a conscience. That was troubling.

  Drafting

  Sometimes I get the feeling that the two biggest problems in America today are making ends meet—and making meetings end.

  —Robert Orben

  Rolfe and I knew that meetings would be a major part of our existence as bankers. We never imagined, though, just how absurd the meetings could get. Banker meetings are a lot like the Ebola virus. They start out small, but they grow quickly. And they don’t stop growing until they’ve consumed everything around them. At times, when it came to meetings, Rolfe and I felt like we were trying to play two-on-two basketball with twenty-five people on each team. We never really nailed down why banking meetings always seem to end up out of control, but we think it has something to do with how the new generation of bankers was hatched.

  In the early days of banking, bankers were a lot like drug dealers. They told the potential customers, “My shit’s the best, man, it’ll really do the job for you.” The customers told themselves, “This guy’s dressed nicely, he’s smooth, he must have the goods.” They bought some of his shit and they took it home. They smoked it down, they shot it up, or they put it into their portfolio, and then they waited. Nothing happened. They weren’t getting high. They weren’t getting rich. Sometimes they even got a headache or, if they were really unlucky, they got some really bad shit that killed them. That was the nature of the beast.

  Before the Great Crash of 1929, bankers were selling all kinds of bad shit to the public. They called the bad shit “securities.” It was like the bankers were packaging up little dime bags of flour and telling the customers that it was high-grade cocaine. The customers didn’t care, because they never tried it and didn’t know what it was. There was always some bigger fool that was willing to pay them even more for their little bags of flour than they’d paid themselves. And then, one day, some random guy tried snorting up some of the flour and he realized that it wasn’t cocaine at all. He realized it was crap. He sold his little bags of flour and told two friends what he’d figured out. Each of them, in turn, called their brokers, sold their bags of flour, and told two more friends about what was going on. Before long, everybody was trying to sell their flour, nobody wanted to buy it anymore, and the Great Crash had arrived. The game was up.

  In the wake of this scandal, the federal government decided that somebody had to reign in the freewheeling bankers and their errant sales forces, who’d foisted the little flour bag scam upon the unsuspecting public. With this goal in mind, President Roosevelt’s regulators jammed reforms through the legislative branch under the guise of the Securities Act of 1933 and the Securities Exchange Act of 1934. Among other things, these Acts created the Securities and Exchange Commission, or SEC, which is now responsible for the monitoring and administration of most aspects of securities issuance in the United States.

  The SEC is pure government bureaucracy. Its policy is never to approve any aspect of a new securities issuance; its only “approval” of a given deal comes in the form of a “failure to disapprove.” In other words, when a c
ompany and their investment bank come to market with a deal, the SEC doesn’t give a seal of approval that the deal’s OK, it merely states, “We’re not saying that this deal’s not OK.” It’s one of those double negatives that guys use to fool their girlfriends after they’ve done something wrong.

  One of the requirements for securities issuers is that they make a filing with the SEC every time they intend to sell new securities to investors. The filings contain very specific information about the company issuing the securities and the nature of the securities themselves. These filings, which generally have to be made available to the investing public, go by a number of different names: S-1, S-3, S-4, the list goes on and on. The type of filing depends on what kind of securities are being issued. The important thing to remember is that the filings are required by law, which means that the bankers don’t have any choice but to put these documents together before they can go out, sell the securities, and earn their fees. They can no longer just tell the buyers that their shit is the best and the companies they are representing are high fliers, now they have to put it in writing. That presents a problem for the bankers, because it creates a paper trail. When things go awry, the buyers know where to point the finger and where to go looking for payback.

  For the ever optimistic bankers, the filing requirements have created an opportunity. The bankers have decided that if they’re going to be forced to create this public filing, then they’re going to do it on their own terms. They’re going to turn it into a sales brochure, complete with color pictures and promotional material about what a fantastic, once-in-a-lifetime investment opportunity the securities being sold represent. They’re going to take that filing, print it up in a neat little package, and mail it out to all the potential buyers. Once it’s in the buyers’ hands, the bankers will take the smoothest, best-looking, most presentable members of company management, trot them out to all the big potential buyers, and put on a show. It’s called a road show, and it’s in the best tradition of the traveling medicine shows. Instead of traveling around and putting on the show off the back of a covered wagon, though, the bankers and the members of management use private jets. They stay in the best hotels, and put the show on in fancy restaurants, so that the buyers can have a nice meal while they hear about how wealthy they’re going to get by purchasing the company’s securities. It’s critical to maintain the image of big money. The buyers have to believe that the management team knows how to make coin. They have to believe that this is the team that’s going to make everybody rich.

  Before the show can begin, the bankers and the company have to give birth to that sales brochure. It’s called the prospectus. It’s a tricky job, because at the same time that the prospectus tells the buyers what a great opportunity exists, it also has to cover everybody’s ass and meet the letter of the law on SEC filing requirements.

  A long time ago, somebody figured out that if he came up with an important-sounding name for these meetings where the prospectus is created, people wouldn’t focus so much on what a waste of time they were. They decided to call them “drafting sessions.” All associates experience their fair share of drafting sessions. Rolfe and I were no exceptions.

  Drafting sessions involve a big cast of characters. Everybody gets together in a room. They spend long days disagreeing with each other on what should be in the prospectus.

  The bankers are always there. They only want to say good things. The better they can make the company sound, the easier it will be for them to sell the securities. The easier it is for them to sell the securities, the more certain they’ll be that the clients will be happy. That means fees. Fees are important.

  The bankers have their lawyers there—the underwriters’ counsel. The job of an underwriters’ counsel is to make sure that the bankers don’t put any lies into the prospectus that are going to get them into trouble later. They have to twist the language in the document around so that if the prospectus ever gets brought up as evidence in a court of law the judge and jury will be so confused that they won’t have any idea what the language is claiming, or trying to claim, or maybe not even claiming at all. They have to be crafty.

  Representatives from the company are there. The CFO almost always shows up; he’s usually in charge from the company’s side. Sometimes, depending on how important the transaction is to the company, the CEO may show up as well. If it’s the company’s first trip to the public markets for money the CEO usually comes in for lunch one day during drafting. There’s almost always somebody more junior from the company there also, usually somebody from the investor relations department. The CFO needs to have somebody to pin the blame on in case things get fucked up.

  The company has its lawyers there also. Similar to the underwriters’ counsel’s role, it’s the company counsel’s job to make sure that any half-truths that go into the prospectus aren’t going to get the company into trouble. Sometimes company counsel is on the same side of the fence as underwriters’ counsel; more often than not they’re arguing with one another. If there’s ever going to be trouble, the company and the underwriters both want the other guy to take the fall. That’s usually why their lawyers end up arguing with each other.

  The company’s accountants are there. Their job is to provide a fair and impartial rendering of the company’s financial health. The prospectus contains a lot of detail on the company’s historical financial performance, and it’s the accountants’ job to make sure it’s accurate. Before the prospectus gets finalized, the accountants have to provide “comfort” on the numbers. They usually spend a lot of time arguing with the company about what the right numbers should be, so their provision of professional comfort is generally accompanied by acute feelings of personal discomfort. At the end of the day, the company can fire the accountants if it doesn’t like the position they’re taking. This means that the accountants tend to come around to the company’s point of view if they want to keep the business. Usually, they want to keep the business.

  If there were only one representative from each participating organization at the drafting sessions, things would probably go pretty smoothly. Five or six people could get together in a room and hammer out the prospectus in a couple of days. The problem is that each organization sends its own small army. An army girded for war.

  The lawyers show up with the managing partner on the account, an associate, and a paralegal. The managing partner’s job is to argue, the associate’s job is to make a lot of pencil marks on the master draft of the document, and the paralegal’s job is to make copies and faxes. As junior bankers, whenever we were feeling low, we’d watch the junior lawyers and start feeling better. They worked just as many hours as we did, they made a lot less money, and their work was even more boring than ours. Three strikes, they were out.

  The bankers show up with a managing director, a vice president, an associate, and, sometimes, an analyst. Having lots of bankers at the drafting sessions conveys strength and power. The clients are supposed to believe that with such an impressive array of financial talent, there’s no way the deal can fail. If there is more than one investment bank underwriting the deal, which there usually is, each of the banks will send its own representatives. Only the lead manager will send the full array of bankers. The co-managers figure that they’re not getting paid enough to have the whole cast show up. Sometimes the co-managers will each send only an associate, but usually they will send at least a couple of bankers.

  There has to be at least one banker from each underwriter. There are two reasons for this. First, each underwriter wants to be absolutely positive that their firm’s name is printed correctly on the prospectus cover. This is a major concern for all associates. The junior banker’s most important job is to make sure that the firm’s name is spelled and displayed correctly on the prospectus cover and that the colors on the cover and inside the cover are accurate and vibrant. Second, a co-manager has to send at least one banker to the drafting session just in case the other underwriters decide that they’re goi
ng to try to get that co-manager evicted from the deal. Allowing a drafting session to pass without at least one banker from your bank being present is more dangerous than letting a hungry weasel into a nudist farm hot tub.

  On the first day of drafting, everybody meets at the company counsel’s office. The company counsel keeps control of the document. Everybody meets up in a conference room that has a big table in the middle of it. Usually, there are twenty to thirty people there. Everybody stands around drinking coffee, adjusting themselves, and billing their clients.

  As associates, our first order of business on the opening day of drafting was to seek out the associates from the other investment banks. We’d find them, introduce ourselves, and size each other up. It was like two dogs meeting in the park and sniffing each others’ asses to determine whether they were compatible. All the associates fell into one of two camps; those who got it, and those who didn’t. You could look into any of the other associates’ eyes and determine immediately which of the two species they were a member of. The ones who got it understood the game. They knew that an associate was little more than a yes-man, and that our role was to be as humble and subservient as a geisha girl. They were our allies, and we’d commiserate with each other throughout the deal process. The ones who didn’t get it believed that they were hotshots and deal magicians. They thought they were driving the wagon train when in fact they were being ridden like an inbred pack mule. They didn’t see themselves for what they were—street punks learning the business. They carried Mont Blanc pens in their front pockets so that everybody could see them. They had new Coach briefcases and shiny leather shoes. They shook everybody’s hand in the entire room and told them how glad they were to make their acquaintance. It was embarrassing to watch. In our minds, they were there to be tormented and, if the right opportunity presented itself, terminated. They were the enemy.