valuestockplayers.com Book ReviewsBlood on the Street: The Sensational Inside Story of How Wall Street Analysts Duped a Generation of Investors
by Charles Gasparino
A VIVID, FASCINATING Look at Wall Street's REAL GAME!!!, March 3, 2007
This book is a PAGE TURNER
If you love Wall Street and what really goes on in the trenches, there may not be a better read than what Charles Gasparino has put together in Blood on the Street. The author takes on the big names of Wall Street during the late 1990's, the so-called Internet Bubble years.
You get vivid portraits of the players, and you either love them or hate them. The one thing this author promises you, is that you won't be sitting on the fence as you read through every chapter. The characters are brought to life. You feel as though you are in the room with them while the stories are playing themselves out.
You realize how gullible investors can be, and how some of the smartest people in the world are just as subject to crowd psychology as everybody else. This is the world of big money, of the movers and the shakers. By the time Gasparino is done putting together his portraits of these people, your understanding of Wall Street will never be the same. You will also realize that a million dollar a year paycheck just ranks as a beginner.
These are just some of the characters you will meet, and come to admire or hate:
What a breath of fresh air, the New York State attorney general became during the entire Internet debacle. The first man to take on the system on its own turf, using laws drafted 80 years ago, that were never employed before. Spitzer displayed extraordinary courage, and legal skills in waging legal war against individuals with unlimited financial resources at their disposal, plus the clout to make phone calls to the right people. Spitzer just wouldn't let go, and ultimately exacted huge, monster size settlements from the perpetrators who thought they were above the law.
This was the Salomon Smith Barney technology analyst who thought he was smart, when he was simply riding a tidal wave, and taking credit for it too. Paine Webber's Joe Grano, a very astute former Green Beret, had Grubman pegged when the analyst tried to use a Salomon competing job offer to hold up Paine Webber for an increase in salary to $3 million plus.
Grano essentially told Grubman "Not to let the door kick him in the a-- on the way out." Grubman went on to make $15 and $20 million annual paychecks at Salomon by bringing investment banking deals through the door, and then getting paid on them as well as writing up stock research. This was the biggest conflict Attorney General Spitzer had ever seen, and he put Grubman through the ringer for it.
You'll love the story of how Grubman traded a favorable write-up on a very famous company that he had been knocking for years and years, until Grubman needed to get his child into a very famous Eastside kiddy school. Grubman leans all over the Chairman of his company to get him to write a letter, make a phone call, just do anything you can to get my kid into that school. In essence what Grubman does is trade his soul for a slot at the school. Ultimately with the ensuing scandal, the poor child never did get to go to the school.
What a guy Blodget was. This the Yale graduate who without an analytical bone in his body or mind, went to the top of the Internet Analyst ranks by becoming the number one player in the game at Merrill Lynch. I equate him to the character in the movie, "Being There", Chance the Gardener. He simply played off the needs of a sales force of 12,000 professionals to believe in someone, because they could not believe in themselves. Blodget had every top executive at Merrill Lynch fooled into thinking he was a genius; the reality is he was an incompetent, highly lucky guy for a while.
Meeker was the Queen of the Internet. Hired away from SG Cowen by Morgan Stanley in the early 1990's, she to her credit was one of the truly early people to recognize the power of the new technology that the Internet was bringing into fashion. She rocked Wall Street by bringing the Netscape Communications initial public offering to Morgan Stanley in 1995.
Spitzer drilled her for hours, but in the end decided not to CRUSH her. The press on the other hand destroyed her reputation on a daily basis after the Internet Bubble burst. Her employer Morgan Stanley was not left untainted by the scandal even if legally Meeker was. The investment banking firm had to contribute a fortune to a global settlement engineered by Attorney General Spitzer. Today Meeker remains head of the global technology research team at Morgan Stanley.
There are other players in this book, which includes long pieces on Sandy Weill, the magical corporate engineer who capped his career with recreating Citigroup. Sandy Weill managed to escaped this volatile period unscathed, another tribute to his massive ability to survive and weather any storm. His reputation was tarnished by the experience, but still there is still some difference between being tarnished, and dragged into a court of law like some of these other characters that author Charles Gasparino is writing about.
In conclusion, if you want a book that you can't put down, written in a way that is just down out fascinating to read about how everybody got wrapped up in the Internet Bubble, than you don't have look any further. This book tells it all. In a weekend, you will knock out this book and love every minute of it. You will also count your blessings if you survived the financial destruction that this period is about. Good luck.
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