Megalomaniacal Blackstone Group C.E.O. Stephen Schwarzman didn’t show up for his buyout firm’s big debut at the New York Stock Exchange on Friday.
So TV crews covering Blackstone’s highly ballyhooed initial public offering of $4 billion in stock had to point their cameras at someone else.
Hey, you in the white suit!
Strolling the trading floor that fateful morning, the writer Tom Wolfe, author of such dense economic texts as A Man in Full and I Am Charlotte Simmons, happily responded to a CNBC reporter’s query.
So, Mr. Electric Kool-Aid Acid Test, what do you think of the Blackstone I.P.O.?
“We may be witnessing the end of capitalism as we know it,” Mr. Wolfe reportedly said.
The bold remark, aimed at the biggest U.S. I.P.O. since 2002, seemed poignant enough to be reprinted in such esteemed publications as Business Week and London’s Financial Times.
Yet no one, it seemed, bothered to ask the 76-year-old novelist why he felt that Blackstone’s crafty fund-raising strategy had suddenly put the nation’s entire economic system in peril. Challenged on Monday by The Observer to back up his now-famous remark, the widely quoted economist quickly back-pedaled.
“I was just saying something off the cuff,” Mr. Wolfe said. “I didn’t think he’d ever take me seriously.”
The reluctant doomsayer denied even paying much attention to the Blackstone matter. “I’ve vaguely followed the Blackstone I.P.O.,” he said.
So what was Mr. Wolfe doing at the NYSE?
“All the years I’ve been in New York, I’ve never been on the floor of the Stock Exchange,” the author of The Bonfire of the Vanities explained. “So, a friend of mine, who knows a member, got me invited. I’m walking around and I see these television cameras. Somebody in the television crew spots me. I don’t even know where he was from. So, he says to me, ‘What do you think of this Blackstone I.P.O.?’ I’m joking, I say, ‘I think it’s the end of capitalism as we know it.’
“But now that I’ve said it,” Mr. Wolfe continued, “I’ve come up with an ex post facto rationalization.
“Joseph Schumpeter, the economist, once said that stocks and bonds are evaporated property, meaning you’re pretty soon going to lose sight of the underlying assets. You’re dealing in pieces of paper. Now, these people are selling shares in evaporated evaporation to millions of people. And this is now evaporation cubed. And nobody knows what they’re investing in. It’s E to the third power equals … insanity?”
He added, “God! I’m a quoted economist!”