The Wolf of Wall Street

by Jordan Belfort

  But at Stratton Oakmont, where our business was microcap investment banking—or, as the press liked to refer to it, penny stocks—we had no such protection. In reality, though, all the new issues were priced between four and ten dollars and weren’t actually penny stocks. It was a distinction that was entirely lost on the regulators, much to their own chagrin. It was for this reason that the bozos at the SEC—especially the two who were now camped out in my conference room—were unable to make heads or tails out of a $22 million lawsuit they’d filed against me. In essence, the SEC had engineered their lawsuit as if Stratton were a penny-stock firm, but the simple fact was that Stratton Oakmont bore no resemblance to such.

  Penny-stock firms were notoriously decentralized, having dozens of small offices spread throughout the country. Yet, Stratton had only one office, which made it easier to control the negativity that would spread throughout a sales force after the SEC filed a lawsuit. Usually that alone was enough to force a penny-stock firm out of business. And penny-stock firms would target unsophisticated investors, who had little or no net worth, and convince them to speculate with a couple of thousand dollars, at most. Stratton, on the other hand, targeted the wealthiest investors in America, convincing them to speculate with millions. In consequence, the SEC couldn’t make their usual claim that Stratton’s clients weren’t suitable to risk their money in speculative stocks.

  But none of this had occurred to the SEC before they filed their lawsuit. Instead, they mistakenly assumed that the bad press would be enough to drive Stratton out of business. But with only one office to manage, it had been easy to keep the troops motivated, and not a soul left. And it was only after the SEC had already filed their lawsuit that they finally got around to reviewing Stratton’s new-account forms and it dawned on them that all Stratton’s clients were millionaires.

  What I had done was uncover a murky middle ground—namely, the organized selling of five-dollar stocks to the wealthiest one percent of Americans, as opposed to selling penny stocks (priced under a dollar) to the other ninety-nine percent, who had little or no net worth. There was a firm on Wall Street, DH Blair, that had danced around the idea for more than twenty years but had never actually hit the nail on the head. In spite of that, the firm’s owner, J. Morton Davis, a savage Jew, had still made a bloody fortune in the process and was a Wall Street legend.

  But I had hit the nail on the head, and by sheer luck I’d hit it at exactly the right moment. The stock market was just beginning to recover from the Great October Crash, and chaos capitalism still reigned supreme. The NASDAQ was coming of age and was no longer considered the redheaded stepchild of the New York Stock Exchange. Lightning-fast computers were appearing on every desk—sending ones and zeroes whizzing from coast to coast—eliminating the need to be physically located on Wall Street. It was a time of change, a time of upheaval. And as volume on the NASDAQ soared, I, coincidentally, was embarking on an intensive three-hour-a-day training program with my young Strattonites. From out of the smoldering ashes of the Great Crash, the investment-banking firm of Stratton Oakmont was born. And before any regulator knew what hit, it had ripped through America with the force of an atomic bomb.

  Just then an interesting thought occurred to me, and I said to Danny, “What are those two idiots from the SEC saying today?”

  “Nothing really,” he replied. “They’ve been pretty quiet, talking mostly about the cars in the parking lot, the usual shit.” He shrugged. “I’ll tell you, these guys are totally fucking clueless! It’s like they don’t even know we’re doing a deal today. They’re still looking at trading records from 1991.”

  “Hmmm,” I said, rubbing my chin thoughtfully. I wasn’t all that surprised at Danny’s response. After all, I’d been bugging the conference room for over a month now and was gathering counter-intelligence against the SEC on a daily basis. And one of the first things I’d learned about securities regulators (besides them being completely devoid of personality) was that one hand had no idea what the other hand was doing. While the SEC bozos in Washington, D.C., were signing off on the Steve Madden IPO, the SEC bozos in New York were sitting in my conference room, entirely unaware of what was about to transpire.

  “What’s the temperature in there?” I asked with great interest.

  Danny shrugged. “High fifties, I think. They’ve got their coats on.”

  “For Chrissake, Danny! Why is it so fucking warm in there? I told you—I want to freeze those bastards right back to Manhattan! What do I have to do, call a fucking refrigeration guy in here to get the job done? I mean, really, Danny, I want icicles coming out of their fucking noses! What about this don’t you understand?”

  Danny smiled. “Listen, JB: We can freeze ’em out or we can burn ’em out. I can probably get one of those little kerosene heaters installed right in the ceiling, and we can make the room so hot they’ll need salt pills to stay alive. But if we make the place too uncomfortable, they might leave, and then we won’t be able to listen to them anymore.”

  I took a deep breath and let it out slow. Danny was right, I thought. I smiled and said, “All right, fuck it! We’ll let the bastards die of old age. But here’s what I want to do with Madden: I want him to sign a paper saying that the stock is still ours, regardless of how high the price goes and regardless what it says in the prospectus. Also, I want Steve to put the stock certificate in escrow, so we have control over it. We’ll let Wigwam be the escrow agent. And no one has to know about this. It’ll all be among friends; omerta, buddy. So unless Steve tries to screw us, it’s all good.”

  Danny nodded. “I’ll take care of it, but I don’t see how it’s gonna help us. If we ever try to break the agreement we’ll be in as much trouble as him. I mean, there’s like seventeen thousand different”—in spite of the office just being swept for bugs, Danny mouthed the words laws we’re breaking—“if Steve ratholes that much stock.”

  I held up my hand and smiled warmly. “Whoa—whoa—whoa! Settle down! First of all, I had the office swept for bugs thirty minutes ago, so if it’s already bugged again they deserve to catch us. And it’s not seventeen thousand laws we’re breaking; it’s maybe three or four, or five, tops. But either way, no one ever has to know.” I shrugged and then changed my tone to one of shock. “Anyway, I’m surprised at you, Dan! Having a signed agreement helps us a lot—even if we can’t actually use it. It’s a powerful deterrent to stop him from trying to fuck us over.”

  Just then Janet’s voice came over the intercom: “Your father’s heading this way.”

  A snap response: “Tell him I’m in a meeting, God damn it!”

  Janet snapping right back: “Fuck you! You tell him! I’m not telling him!”

  Why, the insolence! The sheer audacity! A few seconds of silence passed. Then I whined, “Oh, come on, Janet! Can’t you just tell him I’m in an important meeting or on a conference call or something, please?”

  “No and no,” she replied tonelessly.

  “Thanks, you’re a real gem of an assistant, let me fucking tell you! Remind me of this day two weeks from now, when it’s time for your Christmas bonus, okay?”

  I paused and waited for Janet’s response. Nothing. Dead fucking silence. Unbelievable! I soldiered on. “How far away is he?”

  “About fifty yards, and closing awfully fast. I can see the veins popping out of his head from here, and he’s smoking at least one…or maybe two cigarettes at the same time. He looks like a fire-breathing dragon, I swear to God.”

  “Thanks for the encouragement, Janet. Can’t you at least create some sort of diversion? Maybe pull a fire alarm or something? I—” Just then Danny began rising out of his chair, as if he was attempting to leave my office. I held up my hand and said in a loud, forthright voice, “Where the fuck do you think you’re going, pal, huh?” I started jabbing my index finger in the direction of his club chair. “Now, sit the fuck back down and relax for a while.” I turned my head in the direction of the black speakerphone. “One second, Janet, don�
�t go anywhere.” Then I turned back to Danny. “Let me tell you something, buddy: At least fifty or sixty thousand of that Am Ex bill is yours, so you gotta put up with the abuse too. Besides, there’s strength in numbers.” I turned my head back in the direction of the speakerphone. “Janet, tell Kenny to get his ass in my office right this second. He’s gotta deal with this shit too. And come open my door. I need some noise in here.”

  Kenny Greene, my other partner, was a breed apart from Danny. In fact, no two people could be more different. Danny was the smarter of the two, and, as improbable as it might seem, he was definitely the more refined. But Kenny was more driven, blessed with an insatiable appetite for knowledge and wisdom—two attributes he lacked entirely. Yes, Kenny was a dimwit. It was sad but true. And he had an incredible talent for saying the most asinine things during business meetings, especially key ones, which I no longer allowed him to attend. It was a fact that Danny relished beyond belief, and seldom did he pass up an opportunity to remind me of Kenny’s many shortfalls. So I had Kenny Greene and Andy Greene, no relation—I seemed to be surrounded by Greenes.

  Just then the door swung open and the mighty roar came pouring in. It was a fucking greed storm out there, and I loved every last ounce of it. The mighty roar—yes, it was the most powerful drug of all. It was stronger than the wrath of my wife; it was stronger than my back pain; and it was stronger than those bozo regulators shivering in my conference room.

  And it was even stronger than the insanity of my own father, who at this particular moment was getting ready to release a mighty roar of his own.

  CHAPTER 7

  SWEATING THE SMALL STUFF

  In ominous tones, and with his brilliant blue eyes bulging so far out of his head that he looked like a cartoon character about to pop, Mad Max said, “If you three bastards don’t wipe those smug fucking looks off your faces, I swear to fucking God I’m gonna wipe them off for you!”

  With that, he started pacing…slowly, deliberately…with his face contorted into a mask of unadulterated fury. In his right hand was a lit cigarette, probably his twentieth of the day; in his left hand was a white Styrofoam cup filled with Stolichnaya vodka, hopefully his first of the day but probably his second.

  All at once he stopped pacing, and he turned on his heel like a prosecuting attorney and looked at Danny. “So what do you have to say for yourself, Porush? You know, you’re even more of a fucking retard than I thought you were—eating a goldfish in the middle of the boardroom! What the fuck is wrong with you?”

  Danny stood up and smiled, and said, “Come on, Max! It wasn’t as bad as it seems. The kid deserved—”

  “Sit down and shut up, Porush! You’re a fucking disgrace, not just to yourself but to your whole fucking family, may God save them!” Mad Max paused for a brief instant, then added, “And stop smiling, God damn it! Those boiling teeth of yours are hurting my eyes! I need a pair of sunglasses to shield myself, for Chrissake!”

  Danny sat down and closed his mouth nice and tight. We exchanged glances, and I found myself fighting a morbid urge to smile. But I resisted it—knowing it would only make matters worse. I glanced over at Kenny. He was sitting across from me, in the same chair Wigwam had sat in, but I failed to make eye contact with him. He was too busy staring at his own shoes, which, as usual, were in desperate need of a shine. In typical Wall Street fashion, he had his shirtsleeves rolled up, exposing a thick gold Rolex. It was the Presidential model—my old watch, in fact, the one the Duchess had made me discard because of its gaucheness. Nevertheless, Kenny didn’t look gauche or, for that matter, sharp. And that new military-style haircut of his made his blockhead look that much blockier. My junior partner, I thought: the Blockhead.

  Meanwhile, a poisonous silence now filled the room, which meant it was time for me to put an end to this very madness, once and for all. So I leaned forward in my chair and dug deep into my fabulous vocabulary—extracting the sort of words I knew my father would respect most—and I said in a commanding voice, “All right, Dad, enough of this shit! Why don’t you calm the fuck down for a second! This is my fucking company, and if I have legitimate fucking business expenses, then I’m—”

  But Mad Max cut me off before I could make my point. “You want me to calm down while you three retards act like kids in a candy store? You don’t think there’s any end in sight, do you? It’s all one giant fucking party to you three schmendricks; no rainy days on the horizon, right? Well, I’ll fucking tell you something—all this cock-and-bull horseshit of yours, the way you charge your personal expenses to this fucking company—I’m sick and tired of it!”

  Then he paused and stared the three of us down—starting with me, his own son. At this particular moment he had to be wondering whether or not I was actually delivered by a stork. As he turned away from me I happened to catch a terrific look at him from just the right angle, and I found myself marveling at how dapper he looked today! Oh, yes, in spite of it all, Mad Max was very snazzy—favoring navy-blue blazers, spread British collars, solid navy neckties, and tan gabardine trousers, all custom-made and all starched and pressed to near perfection by the same Chinese laundry service he’d used for the last thirty years. He was a creature of habit, my father.

  So there we sat, like good little schoolchildren, waiting patiently for his next verbal assault, which I knew wouldn’t come until he did one thing first: smoked. Finally, after a good ten seconds, he took an enormous pull from his Merit Ultra low-tar cigarette and expanded his mighty chest to twice its normal size, like a puffer fish trying to ward off a predator. Then he slowly exhaled and deflated himself back to normal size. His shoulders were still enormous, though, and his forward-leaning posture and thin layer of salt-and-pepper hair gave him the appearance of a five-foot-six-inch raging bull.

  Then he tilted his head back and took an enormous pull from his Styrofoam cup and downed its fiery contents, as if it were no stronger than chilled Evian. He started shaking his head. “All this money being made and you three imbeciles blowing it like there’s no tomorrow. It’s a fucking travesty to watch. What do you three think, that I’m some sort of yes-man who’s just gonna roll over and play dead while you guys destroy this fucking company? Do you three have any idea of how many people count on this place for their fucking livelihood? Do you have any idea of the risk and exposure that…”

  Mad Max went on and on in typical Mad Max fashion, but I tuned out. In fact, I found myself mesmerized by this wonderful ability he had to tie so many curses together with such little forethought and still make each sentence sound so very fucking poetic. It was truly beautiful the way he cursed—like Shakespeare with an attitude! And at Stratton Oakmont, where cursing was considered a high art form, to say that someone knew how to tie their curses together was a compliment of the highest order. But Mad Max took things to an entirely different level, and when he really got himself on a roll, like now, it gave his verbal tirades an almost pleasant ring to the ear.

  Now Mad Max was shaking his head in disgust—or was it incredulity? Well, it was probably a bit of both. Whatever it was, he was shaking his head and explaining to us three retarded schmendricks that November’s American Express bill was $470,000, and only $20,000 of it, by his calculations, were legitimate business expenses; the rest were of a personal nature, or personal bullshit, as he put it. Then, in a most ominous tone, he said, “Let me tell you something right now—you three maniacs are gonna get your tits caught right in a wringer! You mark my fucking words—sooner or later those bastards from the IRS are gonna come marching down here and do a complete fucking audit, and you three retards are gonna be in deep shit unless someone puts a stop to all this madness. That’s why I’m hitting each of you personally for this bill.” He nodded in agreement with his own statement. “I’m not running it through the business—not one fucking penny of it—and that’s fucking final! I’m taking four hundred fifty thousand right out of your inflated fucking paychecks, and don’t even try to stop me!”

  Why—the
fucking nerve! I had to say something to him in his own language. “Hold your fucking horses right there, Dad! That’s a complete load of crap, what you’re saying! A lot of that shit is legitimate business expenses, whether you believe it or not. If you just stop fucking screaming for a second I’ll tell you what’s what and—”

  But again he cut me right off, now turning his attack directly toward me: “And you, the so-called Wolf of Wall Street—the demented young Wolf. My own son! From my very fucking loins! How could it be? You’re the worst of the lot! Why the hell would you go out and buy two of the same fur coat, for eighty thousand dollars apiece? That’s right—I called that place, Allessandro’s House of Fucking Furs, because I thought it must be some sort of a mistake! But, no—you know what that Greek bastard down there told me?”

  I humored him with a response: “No, Dad, what did he fucking tell you?”

  “He told me you bought two of the same mink coat—the same color and style and everything!” With that, Mad Max cocked his head to one side and tucked his chin between his collarbones. He looked up at me with those bulging blue eyes of his, and he said, “What, one coat’s not enough for your wife? Or wait—let me guess—you bought the second mink for a prostitute, right?” He paused and took another deep pull from his cigarette. “I’ve had it up to here with all this cockamamie bullshit. You don’t think I know what EJ Entertainment is?” He narrowed his eyes accusingly. “You three maniacs are charging hookers to the corporate credit card! What kind of hookers take credit cards, anyway?”

  The three of us exchanged glances but said nothing. After all, what was there to say? The truth was that hookers did take credit cards—or at least ours did! In fact, hookers were so much a part of the Stratton subculture that we classified them like publicly traded stocks: Blue Chips were considered the top-of-the-line hooker, zee crème de la crème. They were usually struggling young models or exceptionally beautiful college girls in desperate need of tuition or designer clothing, and for a few thousand dollars they would do almost anything imaginable, either to you or to each other. Next came the NASDAQs, who were one step down from the Blue Chips. They were priced between three and five hundred dollars and made you wear a condom unless you gave them a hefty tip, which I always did. Then came the Pink Sheet hookers, who were the lowest form of all, usually a streetwalker or the sort of low-class hooker who showed up in response to a desperate late-night phone call to a number in Screw magazine or the yellow pages. They usually cost a hundred dollars or less, and if you didn’t wear a condom, you’d get a penicillin shot the next day and then pray that your dick didn’t fall off.