The New York Times Book of New York

by The New York Times

  Mr. Morgan did not have the incentive of poverty to spur him on.

  “I am not concerned with the stock market conditions of the Steel stocks,” was the gruff reply, “but I can tell you that the possibilities of the steel business are just as great as they ever were.”

  At the Touch of A Finger, Edwin Shaw Shut the Door Nightly on Wall Street’s Billions

  By MEYER BERGER | July 2, 1958

  NINE YEARS AGO, J. P. MORGAN & CO., INC., needed a new head of security; someone to guard the great vaults and supervise the inward and outward flow of billions of dollars in negotiable paper—someone who would be keenly aware of the job’s responsibilities but not so awed by it that he could not keep the traffic moving smoothly and flawlessly.

  Edwin Shaw drew the assignment. He had worked on coupons. He had been a signer of the corporation’s most confidential messages and documents and no secret had passed from his lips. Yet the boy from Bay Ridge was no scrooge.

  Last Monday was Edwin Shaw’s last day on the job. At 9 a.m. he came in with a vice president of the bank and stood by as the 53-ton steel vault door swung open. The vice president withdrew. Mr. Shaw nodded to his seven vault assistants and they moved through the opening.

  At noon, Ed Shaw was summoned to the old partners’ dining room. Junius S. Morgan was there, and Henry C. Alexander, chairman; H. P. Davison, president; and others. They dined and they reminisced.

  When it was over, they shook hands with Ed Shaw. They gave him a handsome silver cigarette case with his initials engraved in it and with the years of his long service marked. Then he went down to the great vault, and the floodgate of memories opened.

  Funny the things that come to mind—that day a few years ago when one $15 coupon could not be found. It never turned up, somehow. That was the only loss from the vault in his period of stewardship. Not bad when you handle billions every day.

  Chase Is Reported On Verge Of Deal To Obtain Morgan

  By PATRICK MCGEEHAN and ANDREW ROSS SORKIN | September 13, 2000

  JP Morgan Chase Bank acquired failing investment bank Bear Stearns in 2008 for $236 million.

  THE CHASE MANHATTAN CORPORATION, THE third-biggest banking company in the United States, is expected to announce today that it has agreed to acquire J. P. Morgan & Company, one of the most storied banks, for $30.9 billion in stock, executives close to the talks said.

  Chase has been striving to transform itself into a global financial powerhouse, and acquiring Morgan could sharply accelerate the process. Since the early 1980’s, Morgan has changed from a commercial bank with a blue-chip list of clients into a firm focused on investment banking.

  Buying Morgan could catapult Chase into the big leagues of investment banking, the business of raising money for large corporations and advising them on mergers and acquisitions. It would also continue the consolidation among the nation’s largest banks, leaving only a handful of huge institutions at the top of the industry.

  Together, Chase and Morgan would have more than $650 billion in assets, ranking second to Citigroup’s $800 billion.

  Most of Chase’s banking customers would probably not notice much immediate change as a result of the combination. Most of the overlap between the two companies would be in investment banking functions, like underwriting stocks and bonds and trading currencies.

  “The resulting organization would clearly be powerful because both firms are both bank and investment bank,” said Robert Albertson, president of Pilot Financial, an investment firm in New York. “The old Chase and the old Morgan a decade ago would have been oil and water, but now they’re made of the same liquid. They’ve grown closer rather than further apart.” The new firm will be called J. P. Morgan Chase.

  First Woman to Join the Big Board Finds “Grand” Reception

  By VARTANIG G. VARTAN | January 1, 1968

  Muriel Siebert founded her own firm, Muriel Siebert & Co., Inc., in 1967.

  “MURIEL SIEBERT IS PLEASED TO ANNOUNCE her admission,” the announcement card says, “as a member of the New York Stock Exchange.”

  This discreet wording is apt to rank as one of the great understatements on Wall Street for the simple reason that “Mickie” Siebert at the age of 38 has become the first woman in history to own a seat on the Big Board. For 175 august years, the nation’s leading stock exchange had been the private preserve of men.

  “It was last Thursday,” she said. “The board of governors approved my membership. I went to the exchange and handed over a check covering the balance of the $445,000 seat purchase, plus the $7,515 initiation fee. I walked outside and bought three bottles of French champagne for the people in my office. I still couldn’t believe it was me. I was walking on cloud nine.”

  A few of the more conservative members in the financial community had hinted to the personable Ms. Siebert that perhaps she ought to let a man buy the seat.

  “But the people at the exchange were grand,” she exclaimed.

  The reaction of one brokerage-house partner was typical. “I couldn’t care less if a woman bought a seat,” he said. “God bless America. I think it’s great.”

  She arrived on Wall Street in 1954 and went to work for Bache & Co. as a research trainee at $65 a week. In 1958, when she was an analyst at Shields & Co., she received her first commission order from an investment company, as a reward for a research idea.

  That opened her eyes to the wider and more profitable vistas of selling and led, in time, to partnerships at two other firms. Last week, she said good-bye to a partnership at Brimberg & Co., another member firm of the Big Board, after three years.

  Ms. Siebert starts out this week on her own with offices at 120 Broadway. “There will be just myself and a secretary,” she said. “I hope to hire a trader.”

  No Longer the 1980’s

  By MICHAEL S. SCHMIDT | November 3, 2006

  WHEN KAREN L. FINERMAN GRADUATED from the Wharton School at the University of Pennsylvania in 1987, she and many of her classmates—both men and women—headed directly to Wall Street.

  When she returned to campus for her 15-year reunion, she said she was amazed at how few of her women classmates were still working on the street.

  Ms. Finerman, who runs her own hedge fund, Metropolitan Capital, started her career working as a trader, which, she said, seemed the most intellectually challenging. Now, she says, it allows her to balance work with family. (She has two sets of twins.) “The hours for trading are pretty set and they are not long.”

  While women traders may still be a rare sight at Wall Street trading desks and in trading pits on exchange floors, dozens of them gathered at a party at Le Cirque in Manhattan given by Trader Monthly, whose current issue features women traders. Industry estimates say that about one in 10 traders is a woman.

  “I have never thought of it as a men’s industry,” said Lisa M. Utasi, who started as a retail broker at E. F. Hutton two decades ago and is now an equities trader at ClearBridge Advisers specializing in mutual funds. “I have never been inhibited by being a woman.” And, as trading has become more electronic, it has put men and women on a more level playing field, because everyone has access to the same quotes in real time, she said.

  Gender Bias on Wall Street? The Numbers Tell the Story

  By PATRICK MCGEEHAN | July 14, 2004

  DURING SEVERAL YEARS OF DRAWN-OUT litigation over how they treat the women they employ, Wall Street firms have adamantly disputed all contentions that they discriminate—until the time has come to do the math.

  In a sex discrimination lawsuit that Morgan Stanley has just settled, as in those that Merrill Lynch and Smith Barney settled in the late 1990’s, executives decided not to go public with their track records of hiring, paying and promoting women. In each case, labor lawyers said, the numbers painted a picture that would have been hard to defend.

  They show that a few years into the 21st century, Wall Street is still dominated by the white men who fill the bulk of the most powerful and highest-paying jobs in th
e industry. Data from the Equal Employment Opportunity Commission show that men made up more than two-thirds of the officials and managers in the securities industry in 2002, even higher than the ratio in other industries.

  Supported by figures like those, Elizabeth Grossman, who was the commission’s lead trial lawyer in the Morgan Stanley case, was comfortable predicting that more complaints of sexual and racial discrimination on Wall Street will surface now that Morgan Stanley has agreed to pay $54 million to settle the commission’s suit.

  That case stemmed from a 1998 complaint by a bond saleswoman, Allison K. Schieffelin, who contended that she was denied a promotion because of her sex. The firm countered that Ms. Schieffelin, who will receive at least $12 million of the payout, was disappointed about her inability to rise higher and was later fired for being insubordinate.

  “That settlement sends a big statement that maybe she was a troublemaker, but her claim must have had merit or they wouldn’t have paid so much,” said Hydie Sumner, a broker who knows how hard big firms will fight to avoid paying out discrimination claims.

  The numbers painted a picture that would have been hard to defend.

  Ms. Sumner, who worked for Merrill Lynch in San Antonio until 1997, received an award of $2.2 million from a panel of arbitrators this spring after she complained about harassment and discrimination. In ruling, the arbitrators decided that the statistical evidence proved that there had been a pattern and practice of discrimination against women in Merrill’s brokerage operation—the first such finding against a Wall Street firm.

  Milken Gets 10 Years For Wall Street Crimes

  By KURT EICHENWALD | November 22, 1990

  MICHAEL R. MILKEN, THE ONCE-POWERFUL financier who came to symbolize a decade of excess, was sentenced to 10 years in prison for violating federal securities laws and committing other crimes.

  “What I did violated not just the law but all of my principles and values.”

  The sentence, handed down by Federal District Judge Kimba M. Wood in Manhattan, was the longest received by any executive caught up in the Wall Street scandals that began to unfold in 1986, and many legal experts and people on Wall Street expressed surprise at its severity.

  After Mr. Milken serves his term he faces a three-year period of probation. Mr. Milken, who paid $600 million in fines and restitution when he pleaded guilty to the violations, will also be required to perform 1,800 hours of community service during each of three years of probation, or a total of 5,400 hours.

  Judge Wood said the former financier had to be sentenced to a long jail term to send a message to the financial community. “When a man of your power in the financial world, at the head of the most important department of one of the most important investment banking houses in this country, repeatedly conspires to violate, and violates, securities and tax laws in order to achieve more power and wealth for himself and his wealthy clients, and commits financial crimes that are particularly hard to detect, a significant prison term is required,” she said.

  As head of the “junk bond” operations of Drexel Burnham Lambert Inc., which collapsed earlier this year, Mr. Milken financed some of the largest corporate takeovers in the 1980’s. He pioneered the use of high-yield, high-risk junk bonds as instruments for corporate warfare, successfully convincing investors that the bonds’ high returns more than compensated for the risk that the issuers would default.

  The sentence came at the end of a highly emotional hearing, in which Mr. Milken frequently broke into tears as he listened to one of his lawyers plead for leniency. He made only one comment during the proceeding, tearfully telling Judge Wood: “What I did violated not just the law but all of my principles and values. I deeply regret it, and will for the rest of my life. I am truly sorry.”

  Richard Whitney, 86, Dies; Leader In Stopping ’29 Panic Was Jailed in ’38 as Embezzler

  By ALBIN KREBS | December 6, 1974

  RICHARD WHITNEY, THE ONE-TIME PRESIDENT of the New York Stock Exchange who was credited with halting the Wall Street panic of 1929 but later went to prison for embezzlement, died yesterday at the home of a daughter in Far Hills, N.J. He was 86 years old.

  A descendant of the Pilgrim Fathers and son of a Boston bank president, Mr. Whitney bought a seat on the New York Stock Exchange at the age of 23, and soon became principal broker for J. P. Morgan & Co. Cast as the public hero in the halt of the stock panic of 1929, he then served four terms as president of the stock exchange.

  But Mr. Whitney, unknown to all his admirers, was a miserably poor manager of his own financial affairs, and as he fell deeper and deeper into debt, he descended into thievery to cover himself.

  In 1938, exposed as the embezzler of funds entrusted to him by the stock exchange and the New York Yacht Club, of which he was treasurer, as well as for misappropriating funds from his father-in-law’s estate, the one-time hero of Wall Street was sent to Sing Sing Prison.

  Mr. Whitney’s downfall was one of the most sensational scandals ever to hit Wall Street. It hastened the adoption of drastic reforms governing stock market dealings, long pressed by the Securities and Exchange Commission and resisted by an old-guard clique on the Street whose powerful leader had been Mr. Whitney himself.

  Victims Seek a Glimpse Of the Schemer

  By SUSAN DOMINUS | March 13, 2009

  Bernard Madoff pleaded guilty in federal court to all the charges against him on March 12, 2009.

  DEBRA SCHWARTZ, 67, MAY BE THE ONE woman in New York City who feels compassion for Bernard L. Madoff. “I just pity him,” she said Thursday morning, while waiting in the line outside the courthouse where he later pleaded guilty to bilking investors. “I feel bad for this man who lost all sense of reality.”

  By 7 a.m., a bustling line was indeed crowding Worth Street outside the courthouse, but it consisted mostly of bleary-eyed journalists hoping to identify, from a telltale cashmere scarf or well-preserved camel hair coat, a Madoff investor who might talk.

  Ms. Schwartz, one of the very few Madoff investors who showed up early—she said she lost two-thirds of her retirement savings—was happy to oblige. Though she felt pity for Mr. Madoff, she clarified, she did not want leniency. “I would love for him to have nothing,” she said. “In jail, he’ll have food, clothing and shelter, and there will be people who are affected who are going to be out on the street.”

  Ms. Schwartz had arranged to meet at the courthouse a new friend, Bennett Goldworth. Mr. Goldworth, a formerly retired real estate broker with a master’s degree in business, said he had lost $2 million in savings, everything he had. Ahead of them in line was Helen Chaitman, a commercial litigator in her 60s who was hoping to retire in 10 years, but now, having lost all her savings with Mr. Madoff, said she was “looking forward to retiring at 95.”

  Revelation about Mr. Madoff’s scheme did not bring down the financial markets, but they did deepen the sense of crisis, financial and moral, citywide. It was not just that billions of dollars vaporized overnight—it was also that a crime so vast could go undetected. It came to symbolize an era of runaway wealth, a time when the golden coffers were so dazzling they apparently all but blinded the regulators supposed to be keeping guard.

  When Bernard Madoff takes up residence behind bars New Yorkers will surely allow themselves another sigh of relief, one step closer to not only law, but also order.

  REAL ESTATE

  Dividing Harry Helmsley’s Empire

  By DAVID W. DUNLAP | November 26, 2000

  IF HARRY B. HELMSLEY’S BUILDINGS WERE his children, as he liked to say, dozens have found more munificent foster parents in the four years since his death.

  The sale of about half the Helmsley properties and leaseholds nationwide has yielded some $2.5 billion. It has also yielded something else: an enormous capital investment in properties that some purchasers say were indifferently managed, if not downright neglected, in the later years of stewardship by Mr. Helmsley and his colleagues Irving Schneider and Alvin Schwartz.

  “I’m
cheap,” Mr. Helmsley allowed in 1982, explaining that he had changed the name of the New York Central Building at 230 Park Avenue to New York General so that he would have to replace only two letters in the facade. (He later rechristened it the Helmsley Building.)

  When he died in January 1997 at the age of 87, Mr. Helmsley owned or held at least a minority interest in an astonishing lot: about 35 office, loft and showroom buildings in Manhattan, four in Newark and six in Chicago; more than 25 apartment buildings, including the seven-tower Park West Village on the Upper West Side and the 3,500-unit Parkmerced complex in San Francisco; and 13 Harley hotels in seven states.

  And, of course, there is Dunnellen Hall in Greenwich, Conn., the house at the heart of the 1988 tax-fraud case that ended with Mr. Helmsley declared mentally unfit to stand trial and Mrs. Helmsley convicted and sentenced to a four-year prison term.

  Larry A. Silverstein, president of Silverstein Properties, is investing more than $60 million in the renovation of one former Helmsley building, at 140 Broadway. By the time Mr. Silverstein bought it in 1998, he said, it “required everything.” Building systems needed modernization, asbestos had to be removed and the porous plaza had to be sealed because it was leaking into a tenant’s basement space.

  “The fact that he retained this huge volume of real estate until his death is nothing short of remarkable,” Mr. Silverstein said. “The fact that it is being sold by his estate to be transformed yet again is something that’s typical of New York.”