Moral Hazard: Kate Jennings

Australian author Kate Jennings sets her short novel, Moral Hazard, in New York. My Text Classics edition states that Jennings moved to New York in 1979, married an artist and designer in 1987, but when he was diagnosed with Alzheimer’s in 1994, Jennings gave up her freelance work and began working as a corporate speechwriter. I didn’t read these details until after finishing the book, but this certainly explains why the novel feels like a memoir of a short period of the main character’s life.

This is 93-94, New York’s Wall Street before 9-11, before the dot-com bust, before the Madoff investment scandal, before the real estate madness that gripped America for the first part of the oughts. I’d like to think that we’ve all learned something about money and finances, but I know that we haven’t. As long as there is money, people will take risks, riding that theoretical elevator to wealth and success.

In Moral Hazard, Cath, our narrator, gives up her freelance writing job and takes a job as a speechwriter for the investment bank, Neidecker Benecke, “whose ethic was borrowed in equal parts from the Marines, the CIA, and Las Vegas.”  It’s an unlikely job for someone who “disapproved of bankers on principle,” and who’d much rather be reading Sylvia Townsend Warner or Muriel Spark. But Cath needs money, so like many other people, she packs away her principles from 9-5 in exchange for a paycheck. Her husband, designer and collagist, Bailey, twenty-five years her senior, has been diagnosed with Alzheimer’s and so this leaves Cath as the sole breadwinner, paying rent on an Upper East Side apartment, working and returning home to her rapidly disintegrating husband.

The plot follows two different paths–Cath’s care for her husband as his disease progresses and her job at Neidecker Benecke (“in the modern day equivalent of the court of Louis XVI,”) where she befriends Mike, the head of the risk-management unit, a man who’s fond of Frank O’Hara. This is a casual friendship with moments shared over cigarettes, and Cath asking questions, at first so that she better understand her job, and then, later, so that she can better understand Mike. Mike is a very intelligent man who understands the central paradox to the financial markets, and it’s driving him crazy.

Mike, though, was like a married man who falls in love with another woman and plots to kill his wife to gain freedom, when the obvious solution is to drive off down the road to another life.

There are two distinct worlds here: Cath’s dreary, surreal life in the corporate world, and her life with her husband. You come away from this book wondering how Cath kept her sanity. There’s a very definite corporate speak at Neidecker Benecke with exchanges that could very well be delivered by a dead pan Bill Murray as evidenced in a scene between Cath and her boss, Hanny:

“You can write, but you can’t handle complex arguments.”

Generous of him.

“Absolutely. You’re so right. Thank you for sharing that with me. My reasoning powers definitely need developing. I’ll work on it. I’ll work on it very hard,” I replied. Mike had taught me this trick. When someone says something preposterous, agree with them, even heighten the idiocy.

Cath initially tries to keep her husband at home, but as his disease progresses to diapers, temper tantrums and violence, she’s forced to place him in a home, and it’s here that her private misery becomes a matter for the American health system. Both Cath’s job at Neidecker Benecke and her husband’s continuing decline are madness in different forms. The madness of derivatives and the madness of Alzheimer’s–the corporate disease and the human decay.

“Once upon a time, it was commodities, then futures, now derivatives,” he’d opined, delicately shooting his cuffs. “It’s all structured finance. It’s all aimed at neutralizing risk by parceling it up, selling it to someone else.”

While this may sound all very depressing, author Kate Jennings manages to step outside her subject, looking with a wry, unsentimental eye at corporate eye and even Cath’s husband’s last months of life. Faced with corporate malfeasance and assisted suicide, Cath, who’s long since fallen down the rabbit hole, faces ‘moral hazard’ on both professional and personal fronts. Moral Hazard, by the way, has a very specific meaning in the world of finance (a rather ironic one, I’ll add) but the term has multiple instances of significance in the novel.

That first summer, after work, I took to wandering the aisles of Century 21, not shopping, only relieved to be where nothing was demanded of me. I was commuting, it seemed, between two forms of dementia, two circles of hell. Neither point nor meaning to Alzheimer’s, nor to corporate life, unless you counted the creation of shareholder’s value.

This is a lean, finely sculptured novel, crafted with twin strains of the surreal feeling of corporate life and the overwhelming melancholy of watching Bailey’s inevitable decline. Various corporate employees spring to life with venomous alacrity: “enthusiastic bigot,” Hanny and Horace, the unpopular yet powerful cipher “wreathed with gossip.” And on the other end of the spectrum, there’s the employees at the care home, hard-working caretakers with dreams of becoming middle class.

Review copy.

The Fall of Princes: Robert Goolrick

I couldn’t pass up Robert Goolrick’s The Fall of Princes, the story of a former BSD (“big, swinging dick“) trader from Wall Street who soared the heights in the 80s only to plummet to the lows of working in Barnes and Noble. This is his story, and this long, detailed mea culpa AA/NA style confession of a louse’s fall from the pinnacle of success, a story of excess, sex, and drugs, is morbidly fascinating. And I’ll note here that Goolrick, to his credit, approaches his material with restraint, not crudity, unlike The Wolf of Wall Street, so while we read about lines of cocaine and hordes of bedmates, throughout the tale there’s the sense that these young traders, running out of speed, are damaging themselves more than anyone else. The mayhem carries a heavy cost from the outset and doesn’t look like a great deal of decadent fun.

The chapters alternate between the narrator, using the collective ‘we,’ who tells the story of the aggressive, young bull trader lifestyle and the first person narrator who recalls specific incidents.  The narrator lands a job at ‘the Firm,’ where clients “had to have $20 million” in their accounts “at all times. That’s a lot of toys to play with,” and these young traders repeat the words “forty or forty.”

That’s when you retire, they reply with that bland smile. When you reach the age of forty, or your portfolio reaches forty million. That’s when you can get away clean and get your life back. What’s left of it

It’s an adrenaline-fueled life where sleep is a low priority, and rowdy nights are spent drinking, taking drugs, and bedding nameless women. Then when the narrator runs out of steam, he periodically boomerangs to rehab. There’s also a brutal competitiveness amongst the traders which begins with the bodies most of them develop.

Thousands of hours in the world’s most expensive gym, with the world’s most skilled trainers, had brought my body to such a state of perfection that the women who rushed to take off their clothes in my bedroom could only gasp at the luck that had put them into my line of sight, that had made them, even for one night, the most beautiful creatures on earth, with their lithe arms and their skin like chamois and their scents.

The narrator, occasionally referred to by the name Rooney, started out his trader life after various failures as a bad artist and a bad writer, but then turns to trading when he decides that he does not want to end up as one of the “gray masses.”

the place they would end up, neither richer or wiser, filled only with regret and second-tier liquor and the shreds of the dreams they no longer remembered, surprised to wake up one day and be shown the door with a tepid handshake and a future on the edge of old age and death that held only pictures of the kids and grandkids, a cruise to some out-of-season destination every three years, and the notion, which they somehow managed to believe, that this was comfort, that this was all the splendor they got for forty years of relentless drudgery and obsequiousness.

And to all this we said fuck you, we want it all, we want it now, you can drain us of our blood for all we care, but we want impossible things of impossible vintage and provenance. We want salaries equivalent to our ages multiplied by 100,000. We want to live life in a rush of fury and light, to rampage, to pillage our neighbourhoods and rape and demolish our best and closest friends

The collective ‘we’ sections, which at times felt like a Greek chorus describing the ebb and flow of money easily gained and easily lost, are not as powerful as the details of Rooney’s golden life before he ran out of steam just as AIDS swept through his world. There’s a no expense spared summer in the Hamptons … $200,000, a weekend in L.A. … $50,000, and, of course, a bachelor weekend in Vegas. While Rooney bedded and dumped countless women, he finally marries one very high-maintenance woman named Carmela, and he describes their turbulent, short relationship not “so much a marriage as it was like a long, drunken date.”

At times Rooney apologizes for the person he used to be. Sometimes the apology sounds sincere and sometimes it doesn’t. It’s impossible to tell where the remorse ends and the self-pity begins;

Forgive me for thinking that I was better than you will ever be. Forgive me for thinking that money equaled a kind of moral superiority

Rooney picks at the most shameful moments in his life–scabs that won’t heal. There’s one moment when he recalls a game he used to play with his hard-drinking workmates called “To Have and To have Not.”

The idea was you had to think of something you had done that nobody else at the table had done, or something you had never done that everybody else had done.

As the evenings wear on, “the vagaries of human behaviour” are revealed and then Rooney reveals that a girl killed herself when he dumped her. While he mulls over how heartlessly he treated her, a great deal of the regret seems to dwell in the self-pity Rooney wallows in. There’s also the sense that he’d be the same person again in a heartbeat if he got the chance, and we see that aspect of his character in the way Rooney, now in his 50s, dresses in the last of his expensive clothing and spends his days off using  a false name and address and masquerading as a high-flying apartment seeker.

People’s relationship with money is fascinating. Note the films stars who’ve earned millions only to declare bankruptcy, lose homes, or commit suicide when faced with financial disaster and a late life lack of earning power. Money works most of us, not the other way around, and people go the grave never understanding just how finances, and such tedious but necessary things as budgets, work. Of course I was fascinated to read this ‘rise and fall’ tale of a trader–surely, you’d think, someone who would understand money but who ultimately didn’t. All those millions that passed through his hands must have given him some sort of contact high. No authors handle the subject of excess better than Americans, IMO, and it shows here. Yet Goolrick takes the high road when describing the high roller lifestyle rather than sinking to titillation.

(Finally,  I couldn’t help wondering if anyone could survive in NY on Barnes and Nobles wages and save for a foreign trip every year.)

Review copy

The Darlings by Cristina Alger

An alternate title for Cristina Alger’s novel, The Darlings could be How the Other Half Lives, but of course, we’d scale down the word ‘half’ to the term ‘top 1%.’ Yes, this novel is a look at how the top 1% of America’s elite class live and the lives they ruin in order to bank the big bucks in their fraudulent Wall Street shenanigans. The Darlings could only have been written post-boom, post-Madoff debacle, and so that gives you more than a hint as to the book’s content. First time author Cristina Alger worked as an analyst at Goldman Sachs and she is also an attorney. All that behind-the-scenes experience pays off when it comes to setting the backdrop to the story of the Darlings, one of New York’s most prestigious families. 

The novel begins the night before Thanksgiving with an event that opens up the possibility of an investigation into the business practices of Carter Darling, the CEO of the Delphic hedge fund, and in a while-Rome-burns fashion in New York high society, his wife, chairperson and press-hungry philanthropist Ines Darling is busy hosting the fantastically ostentatious New Yorkers for Animals Gala at the Waldorf Astoria. Also attending the event is attorney Paul who is married to the eldest Darling daughter, Merrill. Paul reluctantly started working for his father-in-law when the law firm he worked for folded (another story of financial misdoings there). There’s a strange atmosphere at the Gala event–almost a determined defiance of the economic realities:

The mood was slightly more somber than it had been the previous year, but not by much. The women had turned out in couture. Maybe it was last season, but Paul couldn’t tell the difference. Necks still dripped with jewelry, the kind that spent the rest of the year locked away in a safe. Town cars and chauffeured Escalades idled their engines out front. Of course, it was all an illusion. It had to be. This was a finance-heavy crowd in a finance-heavy town. There wasn’t a single person in this room–not a one–who could claim they weren’t worried. They all were, but they were dancing and drinking the night away as they always had. They had to know the end was coming; it was probably already here. It was like the final peaceful moments at the Alamo.

Some of the bigger financial players are noticeably absent thanks to the recent Wall Street debacle and subsequent bankruptcies. When the company Paul worked for folded, he was reluctant to take the job with his father-in-law but saw little alternative. Cutting back on expenses or alternately taking money from Merrill’s trust fund seemed out of the question, so that left employment with Delphic. The Darlings’ other son-in-law, Adrian, married to youngest daughter, Lily also works for Delphic–although his role seems to be professional client smoocher more than anything else. When gross financial thievery at Delphic becomes apparent, Paul must choose between his loyalty to the Darling family or his own skin….

The novel’s plot concerns Paul’s choice, but he’s not the only character here who has to make some extremely difficult decisions. Various characters are introduced into the novel, and before the plot is well advanced, the author lines up her main players like chess pieces. There are 2 SEC employees hot on the trail of the Delphic Fund, and then there’s Carter Darling’s friend and lawyer, Sol who’s ready to conduct damage control and throw a scapegoat or two to the bloodhounds at the SEC. In many ways, the novel unfolds rather like a mystery, and this really is a page turner. The novel’s greatest strength (apart from its pacing) can be found in its lifestyle descriptions. Here’s the Darling family at Thanksgiving spent in their swanky East Hampton home:

The house was, as ever, eerily perfect. The outside had white trimmed gambrels and a porch that caught the breeze just so. The footpaths were constructed out of brick, eaten away at the corners, the colors as varied as the back of a tabby cat and faded by the sun. Inside, the house had all the trappings of a family estate. Ines favored old silver for meals, the kind that was supposed to be passed down, never purchased, and was slightly worn around the handles. A painting of Carter’s grandfather hung on the library wall; across from it was a framed car company’s stock certificate that supposedly bore his signature. Everything that could be personalized or monogrammed or customized was: the crisp white sheets, the soft blue towels, the L.L. Bean canvas bags that were lugged everywhere, from the beach to the golf course to the farmer’s market. Yet there was something manufactured about it, as though Ines had opened the pages of Architectural Digest and said, “Give me this.” 

The author fleshes out her characters with details of their personal lives. Lily Darling, for example, who hasn’t truly worked a day in her life, now has a line of pricey designer dog accessories–her “first and only attempt at gainful employment” funded, naturally, by daddy. Meanwhile Adrian, feeling the pressure to economize, “fired their maid, Marta, as part of an overzealous campaign  to reduce household expenses. Marta had actually seemed grateful for the release.” And by the time we arrive at that section of the novel, we can understand Marta’s relief at her termination. This brings me to my one complaint about the novel.  Unfortunately, the plot also explores the ‘human side’ of all of its characters, so just one example, Ines who is built up as a prize bitch who has taken materialism to the level of fanatical religion has a moment of collapse and humanity. There’s nothing wrong with having a few selfish, greedy villains in a story such as this. Anyone can make mistakes, but that’s not what we’re talking about here, and to explore the vulnerability of some of the nastier characters undermined the book’s message. Still that complaint aside The Darlings is a page turner. Given the subject matter, this could be a dry tale, but instead, Alger gives us a gripping plot with Paul in the centre of a maelstrom of divided loyalties. 

Review copy courtesy of the publisher via netgalley. Read on the kindle.