December 9, 2008 (LPAC)–“It’s all gone ‘poof’,” one Goldman Sachs banker told today’s Wall Street Journal. Bankers who once wrecked companies and looted pension funds are now finding themselves reduced to irrelevance. Once Masters of the Universe, they are now lucky to have a job. “Investment banking has become a phantom realm,” the Wall Street Urinal said “where everyone is busy but no one is doing anything,” where “status is conferred by a quality meeting, not a completed transaction.” The “basic reality” of their profession, the paper said, is an “excess of bankers.” If you feel tears swelling in your eyes at the plight of these poor souls, who are now faced with selling their yachts and their country homes, and cutting back in other ways, perhaps the knowledge that Wall Street played a major role in destroying the productive power of the U.S. economy, laying waste to countless American businesses and families, will help. This is a classic case of “they did it to themselves.” And, of course, to the rest of us.
Then there’s the spectacle of hyena versus hyena, which we see breaking out as the members of the pack turn on each other in self-preservation. Take the case of Carl Icahn, the notorious corporate raider, and Leon Black, head of private equity giant Apollo Management. Former allies (both got rich from the Drexel Burnham Lambert junk-bond machine, Black as a Drexel banker and Icahn as his client), they are now fighting over money. Apollo needs to reduce its debt by getting its holders to cash it in at as little as 36-cents on the dollar, while Icahn, who owns a bunch of it, calls that fraud and has filed suit.
Hyena versus hyena. Maybe they should have a quality meeting.