The lede alone hit home for me:
To this day, the willingness of a Wall Street investment bank to pay me hundreds of thousands of dollars to dispense investment advice to grownups remains a mystery to me. I was 24 years old, with no experience of, or particular interest in, guessing which stocks and bonds would rise and which would fall. The essential function of Wall Street is to allocate capital—to decide who should get it and who should not. Believe me when I tell you that I hadn’t the first clue.
Sadly (for myself), I was not getting paid hundreds of thousands of dollars, but at 25 I was appearing frequently on cable business news shows as an "expert" on the Netscape-fueled IPO boom that was going on at the time, my qualification being that I was editing an IPO newsletter in New York. Six months off the turnip truck from the Johnson County (Ind.) Daily Journal, I had Wall Street veterans asking me on the air, as if I knew, how they could get into this boom. People nationwide called me from across the nation to ask how they could get in on the first day. My mom, for god's sake, wanted to know how to flip Yahoo. One reporter, I think from CNN, sat in my crappy cubicle to interview me to ask why these IPOs were popping. I gave her my standard, BS answer: "Because people think they're worth it." No, no, no, she said, there's got to be some technical, analytical reason for it. I was in a bit of a cold sweat, thinking maybe she was right, and I repeated: "Because people think they're worth it."
I didn't really know what I was talking about, but I did. The mid-90s IPO boom really fed the casino mentality on Wall Street. The underlying fundamentals didn't matter anymore. But eventually, they do. Heck, Netscape collapsed once people realized there was no way on this Earth it could financially be justified to have a higher market cap than American Airlines (even now). So it goes with the mortgage market (subject of another sleepy newsletter our group had at a time when MBS was new). Unfortunately, that has graver consequences because while we don't all have Netscape stock, the greater economy is fueled by credit and home-buying, especially the last few years.
The circle will probably continue. After all this ****pile gets cleaned up, everyone on Wall Street will talk soberly about underlying fundamentals, until the next out-of-nowhere fad comes up. Then, suddenly, coked-up 40-year-old managers will scream at 24-year-old coked-up analysts and traders to get their ****ing **** moving before someone else takes off with all the money, and then here we go again.
