It’s been a bad week. It feels like things are falling apart.
The whole thing, starting with the subprime, is the fault of the computer. I was just talking to a banker the other day, and not that long ago, 20 years ago, an investment banking house, let’s say, Lehman Brothers, when it got a package of mortgages, they would go through every mortgage, every single one, and they’d throw out the ones that just seemed absurd, they just wouldn’t accept them. Things used to arrive on paper. Today things arrive on a screen, and a screen is back lit, and one of the biggest pains in the neck is trying to read something dully written and complicated on a computer screen. It will drive you nuts—I mean, try it sometime. Now they say, ‘Oh, to hell with it,’ and they just accept the whole package. And if it hadn’t been for that, they’d be going over each loan. What’s happened is the backward march of technology.
The real estate brokers I talk to all still think New York is magically protected from financial crisis.
Well, New York is protected in the sense that this is the capital of the Western world, the way Paris once was, or London once was. And Rome once was. Rome was the first capital of the Western world. So that’s going to bring a lot of people, no matter what the economic conditions are.
But aren’t the days of hyper-expensive real estate, like $40 million apartments at 15 Central Park West, over?
I doubt it. I don’t have that feeling you’re over. I keep reading about that feeling. I don’t run into people who have that feeling. I haven’t been talking to employees of investment banks. Besides, there’s nothing as second-rate as investment banks. Every smart and ambitious young man—and forget young women because they don’t play any role in this—wants to be in a hedge fund. And I’d be surprised if the hedge funds implode, they’re just smarter. … What bright guy wants to be an executive for a firm like Lehman Brothers, where you have to hold the hand of disgruntled employees, you hold the hand of disgruntled directors, you’re constantly nice and wearing the right clothes? That’s for real second-raters. … It’s only the bottom of the barrel that’s left in these companies. I’m trying to think of some analogy! Kind of like the railroad business, investment banking. When I wrote Bonfire of the Vanities, the big thing was investment banking.
Now investment banking isn’t as good?
The new Wall Street is Greenwich, Conn. You don’t need these big glass silos full of people. Look at the number of employees. Lehman? 28,000! And a Greenwich hedge fund can be handling the same amount of money with 20 employees. I’m not saying that either one of them has done any good for the world, but that’s just what I see. Now all that can change, if the bottom drops out.
I hope it doesn’t.
Did I mention to you I’m pimping out my cars?
Don’t think so.
This is my third childhood. I had my second childhood when rock ’n’ roll came along—Martha and the Vandellas. Now this is my third; I pimp up cars. One is a 1993 Cadillac DTS. … The whole interior has been done in white. They took all the stuff out and made it white. I had them paint the rims white. It was kind of like a beige when it arrived, it had a pearly luster to it, it wasn’t bad. But I wanted white. The other is a 1996 Buick station wagon. … It’s all white. My wife likes burgundy, so I left a little burgundy. I’m just a hell of a guy, I try to please people.