I have before me three 100-ruble notes, issued in 1910. Each is imprinted with an identical portrait of Catherine the Great, who’s got a healthy head of hair, a tiara, and a rather Nixonian hint of five o’clock shadow. The Empress is not smiling. The bills are crisp, as if freshly ironed, and the ink — green, black, rose — has lost none of its intensity.
Why, nearly a century after they rolled off the press, do these notes look so new? Well, my ancestors sewed entire bundles of them into the lining of their clothes when they departed Russia, one step ahead of the Cossacks. These closely held assets rustled in their suits, their vests, their topcoats. Shielded from the elements, the bills made their way from Odessa to Bucharest, then to Belgium — where they were becalmed for some months in Antwerp while passage was arranged — and then to England. From there they traversed the ocean to New York in style, on the Cunard Line’s RMS Berengaria. Having miraculously evaded thieves and sticky-fingered immigration officials, they were cut loose from their swaddling and spilled onto a table in Queens. They were bright, uncreased, and consecutively numbered. They were also worthless.
There’s no use blaming it on my ancestors. As they studied the sizzling wake behind the ship, or waited patiently on line at Ellis Island to have their names anglicized, they probably didn’t know that the October Revolution had wiped out their savings. They must have felt prosperous as they walked down the gangplank. And why not? They were wearing the fiscal equivalent of Kevlar next to their skin. History, alas, has certain armor-piercing qualities — and it was history, not greed or sloppiness or bullish optimism, that pulled the rug out from under them. They didn’t deserve to be paupers.
Still, their dalliance with paper wealth can’t help but remind me of my own. I’m going to shed my chronological straitjacket for a moment, the better to recount how the Internet boom took me from rags to riches to, well, nicer rags. As I’ve noted before, I received 1,000 stock options when I was hired by Amazon, with a strike price of $1 per share. Observing some personal difficulties I was having during my first few months on the job — and, quite frankly, out of the goodness of their hearts — my bosses gave me an additional grant in December. Meanwhile, the stock split twice before the company even went public. In retrospect, I assume that Jeff’s silver-tongued testimony on behalf of his brainchild had been almost too effective: with the IPO oversubscribed, he now needed to increase the size of the float and create more shares. At the time, though, I had no idea why such an event would happen. All I knew was that you got a little slip of paper via interoffice mail, and suddenly you had more options. It struck me as a natural process, like the propagation of salt crystals.
Now I had my little heap of options: a few thousand of them. Needless to say there was no physical evidence, not even an engraved certificate of the kind Daddy Warbucks used to pull out of the safe. Yet they existed. They represented my miniscule share of ownership in the company. And on May 15, when Amazon went public, I suddenly gained several hundred thousand dollars in paper wealth.
Some of these shares I owned: in the weeks leading up to the IPO, the company had allowed employees to make advance purchases of stock. Since none of these shares had yet vested, nobody could sell them. Still, it was supposed to be advantageous to snap up at least part of your grant — for tax-related reasons I couldn’t quite fathom — so my parents loaned me a couple thousand dollars and I became an honest-to-god stakeholder. Most of my hoard, however, remained in the form of options. I could watch their value rise and fall, teeter-totter style, on the nifty Internet streaming thing Rebecca had showed me. I could make furtive, embarrassing calculations on a piece of scrap paper, then cover up the figures with a drawing of the little old man I always drew when I was nervous. At this stage, though, there was something fabulously theoretical about the whole business. You had potential riches, Platonic riches, but no cash.
If I had been more flush, perhaps I wouldn’t have felt the contradiction so keenly. But my finances had gotten even shakier during the winter. Persistent illness sent my wife to the hospital on two different occasions, and Amazon’s rather skimpy insurance package covered only a fraction of the costs. Each time, I found myself in the business office at the hospital, cobbling together installment agreements that could easily take me years to pay off. The account managers, young guys who positively radiated good health, were so reasonable that I felt like crying. I kept shaking their hands. I couldn’t stop thanking them.
All that gratitude had a sedating effect on me. For the next few months I did my best never to think about money. I paid my bills, the ones I could, and ignored the rest. I charged everything on my last remaining credit card. I borrowed more money from my friends, promising to repay them out of the proceeds of my chimerical stock sales — which is to say, I not only built castles on air but then erected a penthouse and solarium on top of the castle.
In this fashion 1997 dribbled away. Then something amazing happened. In November I picked up the telephone and told my broker (I had a broker!) to sell a block of shares for me. A few days later, $53,913.20 materialized in my checking account.
For better or worse, this phone call permanently changed my relationship to money. True, much of that cash vaporized within the next week, as I wrote checks to friends, doctors, hospitals, banks, and babysitters. Yet in some subtle way, which I was reluctant to admit even to myself, that call had screwed up my basic conception of getting and spending. Beforehand, I did a job and was paid for it: a simple equation, a zero-sum game. Sometimes I earned more, sometimes less, but the sums always seemed vaguely proportionate. Now that sense of proportion was gone. Don’t get me wrong: I was delighted — glad, as Emerson would say, to the brink of fear — to have these arbitrary riches dumped in my lap. I loved my newfound pot of gold. The fact that it had issued forth from a career as a nickel-and-dime journalist made it all the more precious and paradoxical. Still, there was something freaky about the whole train of events.
And over the next two years, it was going to get a lot freakier. Why? Because we were now smack in the middle of the dot-com boom, partaking of (in a memorable phrase coined by Kleiner Perkins honcho John Doerr) “the greatest legal creation of wealth in the history of the planet.” Amazon’s share price kept climbing. Less than a year after converting my first batch of options into cash, I had another transubstantiation on my hands: I turned into a millionaire. Sure, it was all, or mostly, on paper. So what? The stock split three times between June 1998 and September 1999, and after each split the price continued to levitate. There seemed to be no end to it. When CIBC Oppenheimer analyst Henry Blodget set his celebrated target of $400 per share on December 15, 1998, the price jumped more than $46 that very day, and hit the stratospheric bull’s-eye just a few weeks later. There was no end to it. Doerr’s phrase had begun to look like an understatement.
At the peak of the frenzy, my remaining options were worth nine million dollars. I can hardly type such a sentence without a preemptive shudder: I can feel a towering wave, a regular tsunami of irony, about to break over my shoulders. The bubble, as we all know, eventually went bust. What had resembled a cosmic joke — striking it rich as a book reviewer — turned out to be a cosmic joke, as the price of Amazon stock collapsed. Locked up in the form of unvested options, which I couldn’t sell, most of my fortune disappeared. Hold on, though. For the moment, I’m going to look resolutely backward, and ignore the tear-stained, wallet-busting denouement. That will make it easier to convey what it felt like to be among (as Tod put it one day) “the best paid editorial staff since the invention of moveable type.”
Every happy family is alike, Tolstoy observed — but what about every rich one? As it turns out, there are numerous ways to react when you stumble into a major fortune. Some Amazonians went on buying binges: cars, boats, clothes, art, fine wines, real estate, jewelry, first editions, more real estate. One programmer (and Harley Davidson enthusiast) strolled into a taco joint near the office and loudly announced that he had hit his lifetime trifecta: “I’ve got a hog, a house, and a hot tub!”
Others preferred to plough their gains back into a new, diversified portfolio. You had your hedge funds and T-bills, your bond ladders and blue chips. If you felt even more irrationally exuberant than usual, you could sink some spare change into the latest IPO-telecom, B2B, optical fiber — and keep your fingers crossed. Whatever you did, the market kept behaving like a Roman candle, so it made no sense to park your cash in some chicken-feed bank account: that was the equivalent of losing money, throwing it out the window. You had to keep it circulating. Without a little bounce, a touch of Brownian motion, the dollars would go dead on you. They were always the means to some taxable, teleological end, which is to say, more dollars.
Then there were the people like me, who essentially behaved as though nothing had happened. Oh, it was a wonderful feeling to be relieved of all those financial pressures. Yet most of my old, neurotic inhibitions about money remained intact. We replaced none of our dilapidated furniture: when the cheapo particle-board table from IKEA finally busted, we threw it away and left a vacancy, like a bald spot, in the living room. I still found it difficult to buy a shirt, a watch, a compact disc. And every time I pondered a big-ticket purchase, I heard Chris’s voice in my ear, urging me to avoid his dumb (and dumber) mistakes. This went beyond indifference: I was seeking protective camouflage. The idea wasn’t to look poor, only invisible. Once in a long while, I took a hedonistic plunge: I bought an Ermenegildo Zegna tuxedo for my sister’s wedding, whose upswept lapels seemed designed to accommodate a bigger wallet, and a beautiful Steven Andersen archtop guitar. Mostly, though, I continued to wear my underwear with the holes in it, not wanting to identify with the ruling class even on my way to the shower.
No doubt this reluctance on my part had less to do with thrift than with pathology. My father, a research scientist, always taught me to value creativity (which he had) over cash (which he didn’t). He was right, of course. Still, there may be nothing in this world more crushing than a good lesson taken to heart. It made me suspicious of my own luck. This proved to be prescient in the long run — as it so often does — but it also made my lucre seem filthier than it really was. No wonder I kept my distance from it. In any case, I had found the ideal setting for operating as a stealth plutocrat. Seattle had a long custom of quiet wealth, invisible wealth. Even Bill Gates, the richest man on the planet and the jewel in the crown of the city’s entrepreneurial mythology, followed suit. If he built himself a house as big as the local Sheraton, he had the good taste to bury much of it in a hillside.
I seldom discussed these matters, and never in any detailed way. Early on, a couple of months after the company went public, my sister asked me: “Are you a millionaire now?” I told her, honestly, that I wasn’t. But once I was, I never mentioned the fact to her, nor to my oldest friends, who worked as hard as I did but weren’t being rewarded with such insane sums, who simply weren’t dwelling in the same Cloud Cuckoo Land as I was. An exception: at a certain point, I shared a few figures with my parents. In part this was to reassure them that they would no longer have to prop me up financially, as they had done for so many years. Yet I also wanted to prove that I had made good, that I had hit the jackpot, a childish impulse that I feared would fly right in the face of my father’s ambivalence about material success. I needn’t have worried. He embraced my riches with real gusto, and felt that I deserved much, much more. During his toast to the happy couple at my sister’s wedding, he digressed for a moment to inform the audience that his son had virtually created the Internet’s flagship retailer, and then implored Jeff to ante up: “Mister Bezos, surely James should be given a billion dollars.” My brother, a bass player with a predictably erratic income, glanced down at the table. Thrilled and mortified, I perspired like mad into my fancy tuxedo.
In fact, my father was more in touch with the spirit of the age than I was. To get to the heart of an epoch, you can safely ignore its statements of purpose, its fiery declarations. Listen instead to the questions it asks. In 1863, surveying the panoramic misery of pre-industrial Russia, Nikolai Chernyshevsky asked: What Is To Be Done? In 1997, at which point the United States was supposed to be gliding into a radiant, post-industrial future, the question of the moment was: Who Wants To Be A Millionaire? The answer, needless to say, was everybody. But what made the Lost World of the Late Nineties so extraordinary was that such wealth seemed feasible, not merely to robber barons but to college students and taxi drivers, waitresses and pharmacists and postal carriers. Plenty of people — most people — were still scraping to pay their bills. The rich were undeniably getting richer. Yet the arbitrary nature of the boom, and the way it plucked its beneficiaries from all corners of the economic map, did suggest a certain leveling of the field. Egged on by Regis Philbin, every American could now dwell in Possibility.
Until, that is, March 10 of 2000. On that date the NASDAQ hit its all-time high, closing out the day at 5,048.62, and then commenced a long, ruinous slide, which would eventually siphon $3.8 trillion from our collective pockets. Most Amazonians were slow to panic. We had already seen the stock take a beating on several earlier occasions, then stage a miraculous recovery. And despite the sputtering economy, all the signs pointed to a blowout holiday season, in the course of which Amazon was primed to move more than a billion dollars worth of merchandise. Surely we would ride out the storm. In fact, the company might even benefit from a little culling, and enter the next year as the ultimate dot-com survivor.
No matter. Over the next eighteen months, Amazon shares went into a swoon. They never descended into penny-stock hell, where quite a few heavy hitters of the Internet revolution struggled to warm themselves around the fire. Still, my options lost more than 95 percent of their value before they stabilized and began to claw their way back upward. In the interim, I sold several blocks of stock at what I once would have regarded as absurdly low prices: hadn’t I already lost enough money due to my touching, complacent, loyal, greedy, quasi-religious faith that the company would always bounce back? Would I ever learn? I had been foolish, but now I would be a realist. (In fact, I was being foolish again — as I write these words, the value of the shares has now multiplied tenfold since they touched bottom — but this extra, ironic rotation of the wheel of fortune is more than I can deal with at the moment.) In any case, by the time I returned to Manhattan from Seattle in September 2001, my sister was no longer asking me if I was millionaire. But if she had, I could have told her, honestly, that I wasn’t.
It’s not, as they say, a tragedy. My fortune materialized ex nihilo, without any special effort or ingenuity on my part, and vanished in no less capricious a manner. I made out okay, more than okay: the money I squeezed out of the stock on the way up allowed me to move back East, buy an apartment, and prepare some sort of launching pad for the next stage of my life. From time to time I have these twinges of regret. I find myself staring at those very items I was too superior to covet back when I could afford them: a silver Mercedes-Benz, a black leather chaise lounge, a Rodin — his famous bust of Gustav Mahler — that I saw in a shop window near my dentist. I also dream of a little bungalow I thought of buying during my next-to-last summer in Seattle. The entrance took you through a gate and down the steep western slope of Queen Anne Hill, with fir trees and bright green underbrush on both sides of the path. During the dry months, anyway, it felt like an enchanted forest, and at the bottom of this charming declivity was the house itself, compact and cozy. The price of this picturesque dwelling was $500,000: a ridiculous sum, I thought. Yet now that I’m back in Manhattan, where that kind of money gets you an outhouse with cooking privileges, the bungalow seems more and more something out of a fairy tale, one I actually participated in. What, I ask myself, is the moral of the story? Am I overlooking some basic lesson about money and corruption and mild-mannered hubris? I’m not sure. What I have decided is to stop thinking about the golden age — which turned out to be largely a matter of iron pyrites — and move on.
Here, too, there are certain lessons to be drawn from my family history, with its patterns of Yiddish-accented peripeteia. What, for example, became of my great-grandfather Abraham Felder, who sewed all that Czarist currency into his clothing? At once he hooked up with his brother-in-law, who had emigrated some years before and set up as a diamond merchant. Together they founded what was then a cutting-edge business, the Roaring Twenties equivalent of online commerce: selling jewelry by mail order. They made pots of money, more than enough to compensate for Abraham’s defunct rubles. True, they were living in the midst of a major boom — President Coolidge himself anointed it a “new era of prosperity” — when it was supposedly impossible not to make money. So they went with the flow, and became rich men.
By 1925 it was time to move to a tonier neighborhood. They left Queens for Brooklyn: for Flatbush, more precisely, which was then an upper-middle-class citadel instead of an urban eyesore. They bought a mansion on Bedford Avenue, cheek-by-jowl with the country club, and there my father spent much of his childhood. Each morning a chauffeured Packard conveyed them to their offices on Bleecker Street. The driver — to whom my ancestors, early practitioners of trickle-down economics, gave a motorcycle — sat in the car all day, wrapping himself in a blanket when the temperature dropped. Then he drove them home again at the end of the day.
Not surprisingly, Abraham and his partner developed a healthy disdain for alarmists, defeatists, the faint of heart. Having escaped catastrophe by the skin of their teeth back in Russia, they now excluded its very possibility. They had traded those rubles — wastepaper, play money, confetti — for solid American currency, hadn’t they? Their future was assured. They weren’t speculators, fooling around with intangibles: they dealt in precious stones, objects you could hold in your hand. (“Were they selling costume jewelry or the real thing?” I asked my father. “Nobody knows,” he told me.) Approached by their own nephew to at least buy some life insurance, they declined. “Insurance policies are for poor people,” they informed him. “We’re set for life.” Pragmatists, they also turned up their noses at various other pie-in-the-sky prospects. An opportunity arose to invest in shares of the nascent Transworld Airlines. The whole concept made them suspicious: no whimsical, Chagall-like dreams of flight for these Jews. “Nobody will ever fly from one coast to another in an airplane,” was their final judgment.
How easy, in retrospect, to see what they did not! That catastrophe was part and parcel of their universe they should have known, and not only because they left Odessa in such a hurry. Catastrophe was in the air, the water. Even the Berengaria — the steel-helmed vehicle of salvation that carried them from the Old World to the New, with its swimming pool, Turkish baths, and, on the promenade deck, an actual brokerage office for stock trades –was itself a kind of dividend paid on a previous disaster. It had been given to Cunard by the Hamburg-American Line after World War I as compensation for the Lusitania, destroyed by a German torpedo on May 7, 1915. With a yawning gash in its starboard hull, the ship sank in a mere twenty minutes. That left little time to deploy the lifeboats, and 1,198 passengers drowned in the Atlantic. The calculus of such a disaster is unbearable, the very arithmetic an insult.
Compared to those unlucky souls, Abraham and his partner lost nothing when the economy collapsed in 1929. As they saw it, though, they lost everything. The business dried up. Their investments went sour. The driver was let go. Somehow they held onto the house on Bedford Avenue, but even that functioned as something of a goad, reminding them that it was better never to have money (as they tirelessly noted) than to have it and lose it. As the Depression deepened and grew more desperate, they took to sitting in the parlor every evening with the lights out, silent and embittered. From time to time they broke the silence in order to blame each other: “It’s your fault I’m poor now!” Mostly, though, they kept quiet. In such a state they refused to think much about the future, which had seemed to issue them certain promises, certain obligations, and had now defaulted on them. My father, then a boy, observed all this: the dark room, the chastened, furious partners. He may have decided then, on instinct, that cash was a dubious foundation for the good life. In any case, he passed that belief on to me, along with those 100-ruble notes. The secret to keeping money fresh, it turns out, is to never spend it.
As for me: I had other catastrophes to reckon with. A week after leaving Amazon and returning to New York, I dropped my son off at school in the morning, walked east along Great Jones Street, and heard, as I approached the intersection of Lafayette, what sounded like a military jet passing directly overhead, going south. There was a loud roar, the kind you could feel in the soles of your feet. Some stunt, I thought. But it was, as we all know, a passenger plane, and thirty seconds later everything changed no less decisively than it had when that torpedo struck the Lusitania. With tears in my eyes, I stood in the midst of a furious, chastened crowd on the corner and watched the towers burn. In the distance I thought I saw tiny pieces of paper floating in the air like confetti, but this was a trick of perspective: these were big sheets of metal or glass or gypsum board, carried aloft by the updraft.
That evening I found myself at an outdoor restaurant on the Upper East Side. The place was jammed, and the funereal hush of the afternoon had been broken. In fact there was a peculiar energy in the air, a sense of expectancy, as if we were all waiting for a verdict to be announced. People joked, argued, struggled to regain their conversational footing. If you squinted, this could almost pass for normal life. A man at the next table sent back his endive salad as a procession of enormous refrigerator trucks dodged potholes on their way downtown. Anybody could figure out what the trucks were for. I did. And my lost riches, which had already ranked pretty low on the scale of terrible events, dwindled to microscopic size, then vanished.
I wish I could say that I never thought of them again. Yet I do. The ordinary heartbreaks, as Nadezhda Mandelstam called them — the non-catastrophic ones — are sometimes trivial, sometimes not. In either case, they’re impressively tenacious. In the evenings, as my ancestors did, I lapse into the occasional reverie about my monetary rise and fall. I’ve made it a habit, however, to always leave the lights on.