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Is widening income disparity the real economic crisis we're facing? Weigh in on rich and poor in Table Talk's Business and Personal Finance area

R E C E N T L Y

My guilty secret
By Heather Chaplin
Some people buy porn; I like to buy make-up -- in private
(11/20/98)
Halloween's hollow spree
By Heather Chaplin
How the season of candy-eating kiddies has become monstrously lucrative
(11/06/98)
The greatest gambling hall on earth
By Heather Chaplin
A view of the floor of the New York Stock Exchange
(10/23/98)
The geology of investing
By Dave Zgodzinski
What investors can learn from sedimentary rock
(10/16/98)
Hedging their butts
By Heather Chaplin
While the world's mega-players bail out a wrecked hedge fund, one befuddled reporter tries to figure out just what these arcane vehicles actually are
(10/09/98)
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THE LAST HURRAH FOR WEST COAST FINANCE | PAGE 1, 2
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Even before I stepped inside the big white tent on the second of three planned nights of entertainment, the bleached R&B strains of Huey Lewis reached out to me, a warning that something bizarre lay ahead. The tent was generic enough, but its sheer size lent it a fantastic look that it was clearly striving to avoid. It took up a good chunk of Pier 32 -- a piece of Gatsby's candy Manhattan broken off and shipped to San Francisco.
Inside, it was plenty weird: a Bacchanalian feast in a sports bar. Four open bars, each with two bartenders, offered a complete spectrum of booze. Waiters shuttled bottles of Johnny Walker Black to any table clamoring for one. Aspiring actors sliced up flat-iron steaks, others dished up prosciutto, clams on the half shell or tubs of french fries. On each table, a 40-page wine list boasted that "Many of the wines have been served in the White House and at State Dinners." Among the tables were scattered pinball machines, PacMan games, basketball hoops, football tables, neon beer signs, jerseys autographed by Jerry Rice and baseball cards autographed by Sammy Sosa and Roger Maris. Closed-circuit TVs flashed with baseball, boxing, basketball and football.
At center stage, a Huey Lewis more ruddy, wrinkled and bloated than the one enshrined on VH1 reruns ambled through his golden oldies while a crowd of some of the most influential and wealthy people in our supposedly sober business world boogied in their Slates and penny loafers, punching the air and hooting with drunken pleasure.
It was the frat party that time forgot.
The moorings of this grand spectacle started to snap at the end of the evening, however. As the last number ended, Huey thanked the crowd and bolted with his band offstage. The lights came up to illuminate a littered dance floor and a crowd of haggard, inebriated revelers still anxious to party on. They stomped for an encore that didn't come. Eerily, it was as if the party was over not only for Weisel and the old Montgomery Securities, but, to hear many conference attendees tell it, for the 7-year-old bull market that had propelled them to the big time. Outside the tent, of course, the stock market was in the midst of a bearish plunge that would eventually strip a quarter of their overall value before recovering. Even now, with the Dow again at a record high, many experienced investors point to signs that the bull rally can't last much longer: Declining earnings, cuts in corporate spending, reduced hiring, the Fed cutting rates out of fears of a recession all presage serious trouble ahead.
And as I made my way to the exit, I stopped to join a crowd watching one of the TV sets, playing a boxing match, with Mike Tyson in the ring. Trying to remember whether Tyson had been reinstated, I looked at other sets. One showed Mark McGwire at bat wearing an Oakland uniform. Another showed the 49ers playing the Cowboys, which broke to a commercial touting a brand new TV show called "The X-Files." Like the music, I suddenly realized, the televised entertainment was all about yesterday's greatest hits.
The reruns of sports highlights from the early '90s was fitting. Those were the yesteryears when Weisel and his guests made their money. Throughout the '80s and '90s, Weisel emerged from each slump in Silicon Valley with a stronger firm than ever. He lived down criticisms from cross-town rivals and local papers that Montgomery's initial public offerings were time bombs in the making. He matured from a banker with a volatile temper to the mellower role of elder statesman of Silicon Valley finance. And his annual Growth Conference became the largest investment conference in the world.
The idea for lavish evening entertainment struck Weisel one night in the early '80s, when the CEO of Coors took the microphone at a dinner and spent the next couple of hours trashing other brewers. In Weisel's version, the evening fetes served as an obstacle for rival firms trying to schmooze the fund managers Weisel had invited to town. They'd also become the conference's most memorable feature, an oasis in a desert of dry earnings discussions that draws comparisons to the obscenely lavish Predator Balls that Michael Milken staged in the bubblicious '80s.
This year's shows had an extra layer of drama because the rumors were already swirling that Weisel would soon resign. His last act, though, faced a snafu -- a kind of gremlin ex machina. The last evening's event was turning into a bit too much of a success. By Thursday afternoon, tickets had become scarce. Guests were being asked not to invite their spouses. And when the tour buses started pulling up to the grand white tent on Pier 32 on Thursday, the fund managers were surprised to learn the gates to the pier were closed to them. The San Francisco fire marshal had shut down further access to the party because there were already too many people inside.
At first, the crowd of Burburys at the gate stood there in a collective denial. Everyone seemed to be fighting off the inevitable analogy of the spectacle they made to the turmoil in the financial markets they worked in. With global markets toppling and U.S. stocks acting like a recession was near, it seemed there wasn't enough room in the stock market for all the dreamers anymore. But, the thinking went, that was OK. Weisel was in charge and he knew how to get his way. It would be fixed any minute.
This complacent sentiment among the fund managers at the gate started to decay as the minutes passed and the crowd swelled under the autumn sky. It wouldn't be long before tempers started to flare. Angry outbursts of the "do you know who I am" variety. Threats of reprisals. Failed attempts to sneak past the handful of police present ("That's my boat there," a fund manager said, pointing to a moored yacht). The police responded to each effort with the kind of strained patience that spoiled brats draw from their baby sitters.
After a while, a couple of Montgomery minions appeared and put a nice spin on things. It's really not so pleasant inside, they said, rather hot and crowded. The food and drinks and entertainment were all on hold until they could get the guest count down. Plus, Montgomery was telling any of its employees who rank below vice president to get the hell out of the big tent and make room for more fund managers.
This did not soothe many tempers. After all, sensitive egos had been bruised. The rights of individuals -- rich individuals! -- to have a good time had been thwarted. Perhaps it was starting to dawn on them: This is what happens to the little people.
The crowd could withstand no more; they called for the man of the hour himself.
"Tell Thom Weisel to come out here and explain this to us," a stout fund manager with a trophy date on his arm yelled at the fire marshal. He pronounced the name "Weasel" -- a slip that has been known to set off the famous temper of the Montgomery chief.
"It's Why-zell," another in the crowd corrected him.
"No, he's a weasel!" the fund manager insisted.
As the evening grew darker and foggier, the chill set in and with it a realization that the host wasn't going to show. The police stayed stubbornly impassive and the crowd started to ebb. More outside guests would be allowed in as more inside guests departed, but the notion of standing in line was distasteful to most. I joined a group of other journalists who did the only sensible thing under such conditions: retire to a bar.
Walking down the Embarcadero, I couldn't resist a last look over my shoulder. Weisel and the others who had built this big dream of Silicon Valley finance might well be back someday. But for now, the spectacle of their era was clearly receding into the evening fog.
SALON | Nov. 27, 1998
Kevin Kelleher is a senior editor at theStreet.com in San Francisco.




T A B L E__T A L K Is widening income disparity the real economic crisis we're facing? Weigh in on rich and poor in Table Talk's Business and Personal Finance area R E C E N T L Y My guilty secret By Heather Chaplin Some people buy porn; I like to buy make-up -- in private (11/20/98) Halloween's hollow spree By Heather Chaplin How the season of candy-eating kiddies has become monstrously lucrative (11/06/98) The greatest gambling hall on earth By Heather Chaplin A view of the floor of the New York Stock Exchange (10/23/98) The geology of investing By Dave Zgodzinski What investors can learn from sedimentary rock (10/16/98) Hedging their butts By Heather Chaplin While the world's mega-players bail out a wrecked hedge fund, one befuddled reporter tries to figure out just what these arcane vehicles actually are (10/09/98) - - - - - - - - - - - - - - - - Browse the Money feature archives S A L O N E M P O R I U M FREE! 12-ounce bag of Salon Blend with a purchase of $30 or more. While supplies last.		THE LAST HURRAH FOR WEST COAST FINANCE \| PAGE 1, 2 - - - - - - - - - - Even before I stepped inside the big white tent on the second of three planned nights of entertainment, the bleached R&B strains of Huey Lewis reached out to me, a warning that something bizarre lay ahead. The tent was generic enough, but its sheer size lent it a fantastic look that it was clearly striving to avoid. It took up a good chunk of Pier 32 -- a piece of Gatsby's candy Manhattan broken off and shipped to San Francisco. Inside, it was plenty weird: a Bacchanalian feast in a sports bar. Four open bars, each with two bartenders, offered a complete spectrum of booze. Waiters shuttled bottles of Johnny Walker Black to any table clamoring for one. Aspiring actors sliced up flat-iron steaks, others dished up prosciutto, clams on the half shell or tubs of french fries. On each table, a 40-page wine list boasted that "Many of the wines have been served in the White House and at State Dinners." Among the tables were scattered pinball machines, PacMan games, basketball hoops, football tables, neon beer signs, jerseys autographed by Jerry Rice and baseball cards autographed by Sammy Sosa and Roger Maris. Closed-circuit TVs flashed with baseball, boxing, basketball and football. At center stage, a Huey Lewis more ruddy, wrinkled and bloated than the one enshrined on VH1 reruns ambled through his golden oldies while a crowd of some of the most influential and wealthy people in our supposedly sober business world boogied in their Slates and penny loafers, punching the air and hooting with drunken pleasure. It was the frat party that time forgot. The moorings of this grand spectacle started to snap at the end of the evening, however. As the last number ended, Huey thanked the crowd and bolted with his band offstage. The lights came up to illuminate a littered dance floor and a crowd of haggard, inebriated revelers still anxious to party on. They stomped for an encore that didn't come. Eerily, it was as if the party was over not only for Weisel and the old Montgomery Securities, but, to hear many conference attendees tell it, for the 7-year-old bull market that had propelled them to the big time. Outside the tent, of course, the stock market was in the midst of a bearish plunge that would eventually strip a quarter of their overall value before recovering. Even now, with the Dow again at a record high, many experienced investors point to signs that the bull rally can't last much longer: Declining earnings, cuts in corporate spending, reduced hiring, the Fed cutting rates out of fears of a recession all presage serious trouble ahead. And as I made my way to the exit, I stopped to join a crowd watching one of the TV sets, playing a boxing match, with Mike Tyson in the ring. Trying to remember whether Tyson had been reinstated, I looked at other sets. One showed Mark McGwire at bat wearing an Oakland uniform. Another showed the 49ers playing the Cowboys, which broke to a commercial touting a brand new TV show called "The X-Files." Like the music, I suddenly realized, the televised entertainment was all about yesterday's greatest hits. The reruns of sports highlights from the early '90s was fitting. Those were the yesteryears when Weisel and his guests made their money. Throughout the '80s and '90s, Weisel emerged from each slump in Silicon Valley with a stronger firm than ever. He lived down criticisms from cross-town rivals and local papers that Montgomery's initial public offerings were time bombs in the making. He matured from a banker with a volatile temper to the mellower role of elder statesman of Silicon Valley finance. And his annual Growth Conference became the largest investment conference in the world. The idea for lavish evening entertainment struck Weisel one night in the early '80s, when the CEO of Coors took the microphone at a dinner and spent the next couple of hours trashing other brewers. In Weisel's version, the evening fetes served as an obstacle for rival firms trying to schmooze the fund managers Weisel had invited to town. They'd also become the conference's most memorable feature, an oasis in a desert of dry earnings discussions that draws comparisons to the obscenely lavish Predator Balls that Michael Milken staged in the bubblicious '80s. This year's shows had an extra layer of drama because the rumors were already swirling that Weisel would soon resign. His last act, though, faced a snafu -- a kind of gremlin ex machina. The last evening's event was turning into a bit too much of a success. By Thursday afternoon, tickets had become scarce. Guests were being asked not to invite their spouses. And when the tour buses started pulling up to the grand white tent on Pier 32 on Thursday, the fund managers were surprised to learn the gates to the pier were closed to them. The San Francisco fire marshal had shut down further access to the party because there were already too many people inside. At first, the crowd of Burburys at the gate stood there in a collective denial. Everyone seemed to be fighting off the inevitable analogy of the spectacle they made to the turmoil in the financial markets they worked in. With global markets toppling and U.S. stocks acting like a recession was near, it seemed there wasn't enough room in the stock market for all the dreamers anymore. But, the thinking went, that was OK. Weisel was in charge and he knew how to get his way. It would be fixed any minute. This complacent sentiment among the fund managers at the gate started to decay as the minutes passed and the crowd swelled under the autumn sky. It wouldn't be long before tempers started to flare. Angry outbursts of the "do you know who I am" variety. Threats of reprisals. Failed attempts to sneak past the handful of police present ("That's my boat there," a fund manager said, pointing to a moored yacht). The police responded to each effort with the kind of strained patience that spoiled brats draw from their baby sitters. After a while, a couple of Montgomery minions appeared and put a nice spin on things. It's really not so pleasant inside, they said, rather hot and crowded. The food and drinks and entertainment were all on hold until they could get the guest count down. Plus, Montgomery was telling any of its employees who rank below vice president to get the hell out of the big tent and make room for more fund managers. This did not soothe many tempers. After all, sensitive egos had been bruised. The rights of individuals -- rich individuals! -- to have a good time had been thwarted. Perhaps it was starting to dawn on them: This is what happens to the little people. The crowd could withstand no more; they called for the man of the hour himself. "Tell Thom Weisel to come out here and explain this to us," a stout fund manager with a trophy date on his arm yelled at the fire marshal. He pronounced the name "Weasel" -- a slip that has been known to set off the famous temper of the Montgomery chief. "It's Why-zell," another in the crowd corrected him. "No, he's a weasel!" the fund manager insisted. As the evening grew darker and foggier, the chill set in and with it a realization that the host wasn't going to show. The police stayed stubbornly impassive and the crowd started to ebb. More outside guests would be allowed in as more inside guests departed, but the notion of standing in line was distasteful to most. I joined a group of other journalists who did the only sensible thing under such conditions: retire to a bar. Walking down the Embarcadero, I couldn't resist a last look over my shoulder. Weisel and the others who had built this big dream of Silicon Valley finance might well be back someday. But for now, the spectacle of their era was clearly receding into the evening fog. SALON \| Nov. 27, 1998 Kevin Kelleher is a senior editor at theStreet.com in San Francisco.